Look, I understand that everyone gets a little crazy from time to time, but the frothy reaction to a $450 million offer for Gateway's (NYSE:GTW) retail PC business is downright loony.

Here's a recap for those who aren't yet up to date. On Monday, hedge fund managers Firebrand Partners and Harbinger Capital Partners filed a 13-D form with the Securities and Exchange Commission (SEC) in which they disclosed a 10% stake in the PC maker.

Within was a letter to interim CEO Rick Snyder explaining the rationale for the purchase:

"The motivation for our investment in Gateway can be distilled to one simple thesis; there is nothing wrong with Gateway that can't be fixed with what's right with Gateway. We believe that the firm's brand equity, heritage of innovation, and retail channel strength, position the firm to be a leader in the evolution toward design-driven, user-friendly, media facile PCs."

See what I mean? Loony!Dell (NASDAQ:DELL) has brand equity; Gateway can't even produce decent returns on equity. It hasn't turned in a year's worth of positive free cash flow this century.

Nevertheless, on Wednesday California entrepreneur Lap Shun Hui, who founded and then sold eMachines to Gateway for $262 million in 2004, made the $450 million offer. And that's when investors started dancing in the streets; the shares are up 16% since.

That may be because Hui's is the only deal that makes even a modicum of sense. According to SEC filings, 66% of Gateway's trailing 12-month revenue has come from its retail operations. And while the business overall recorded a $30 million operating loss, retail generated $125.5 million in operating income. Retail, it seems, is the only thing that Gateway can do right.

But that's no excuse for buying by blindfold, as some investors seem to be doing. Remember: Hui's offer -- at just 16% of the retail group's sales and three times operating profit -- is anything but rich.

Plus, Hui was selling shares of Gateway as recently as last month. Do you really think he's serious about buying? More likely to me is that Gateway will consider his offer briefly, turn it down, and then hope for a bidding war that may never come, leaving mad cow investors with even more red than before. Don't be among the victims.

Related Foolishness soothes the angry bull:

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Fool contributor Tim Beyers never could figure out those old cow commercials. He didn't own shares in any of the companies mentioned in this story at the time of publication. Get the skinny on all of the stocks in Tim's portfolio by checking his Fool profile. The Motley Fool's disclosure policy smells like freshly cut grass on a cool spring day.