Board With The Truth

[Archive]

Posted By: bruce dorskind

We begin this post by stating that we have no tolerance for any collector,
dealer or auctioneer that alters a card, knowingly sells an item that is not
as advertised and/or allows or encourages shill bidding in his/her auction.

These actions represent both ethical and legal violations, and should be
severely punished to the full extent the law allows.

However, we also find it remarkable that Board Members who are
suppose to be so knowledgeable about the Hobby and the industry,
make comments and draw conclusions about a company, or a person
which has little basis in fact. Whilst one can understand the emotional
disapppointment and economic consequences of discovering one
paid for something other than what one expected, we are talking
about cardboard. Errors occur in every business.

The point is that this is a business, not a hobby, and everyone makes
mistakes. How many of you have a business where your "error rate"
runs less than 2%? Now let's look at the facts about PSA.


About PSA

PSA is one of the brands owned by Collectors Universe, a publicly traded
company. Collectors Universe is a small compay with revenues of
less than $35 million. Its largest individual shareholder is its CEO, David Hall.

In the latest year for which data is available, Collectors Universe
graded 2.86 million items. 58% of these items were coins and
38% were sports cards.

However if one looks at the value of items graded, coins
represented $1.2 billion in value and sports cards representd
only $66 million in value.

In terms of revenue for Collectors Universe coins represent 69%
of revenue and sports cards represent 24% of revenue.

Given these facts, a small dealer who runs three 1000 lot auctions a year
(assume 50% of the lots were graded by PSA) means said dealer's
business with Collector's Universe represents less than a fraction of
1% of their total business.

Therefore it is doubtful that PSA and Memory Lane, for example,
have economic ties which could influence Collector's Universe'
share price.

On the Collectors Universe web site (www.collectors.com), one can
find a complete list of their experts. They list over 50 such experts
across all their brands. None appear to be significant shareholders
in the company.

Finally, for those who want to gain deeper insight into Collectors
Universe and their future business directions, there is a publicly
available web cast which will take place on Tuesday January 9
which is tomorrow.

The link to said web cast can be found at

http://phx.corporate-ir.net/phoenix.zhtml?p=irol-eventDetails&c=80247&eventID=1420139

Thanks for your time. Your comments are welcomed.

Bruce Dorskind
America's Toughest Want List