I go away for a week or so, and the children totally go nuts. Geez. Whether you are long or short, here is what is going on with the stock, (in my opinion).
It has been reported in the media that ex-portfolio manager Schoenberg at Dreyfus has been put in a corner, hands, mouth, and feet bound with duct tape. (kinda' sounds neat, huh?). Regardless, the new guy there has stated that the market cap of the ex-Schoenberg funds is moving up, more towards a mid cap style. Midcap starts at around $1.5 billion. That means that a lot of stocks that were owned have to be sold, unless they go up dramatically to qualify for midcap. In addition, the performance of those Dreyfus funds has been Ka-Ka this year - that's Oklahoma for stinky. Poor fund performance plus the publicity of the wacko stocks Schoenberg bought via a very bizarre relationship with an investment bank most people never heard of Jansen-Meyers likely made many investors pull money out of the fund. Therefore, CCSI which was over 10% of the fund before the Schoenberg stuff hit the fan, could have gone up to nearly 20% of the fund when it went to $17. A 20% weighting in any stock for a mutual fund borders on insanity. I therefore submit, that much of the selling since it hit $17 is Dreyfus.
One of the oldest cons on the streets of NY is to place a ball under a cup and have someone guess which cup the ball is under as the cups are moved around. Such sleight of hand requires the con artist to cause the viewer to misdirect attention - to look the wrong way as the ball is moved in a counterintuitive manner. That is what is happening with this stock. My original thesis of overvaluation was fundamentally based. I do not believe in overstating either a long or short case. I do not believe this company is a fraud, and encourage everyone to attempt to be more civil in their discussion. This company has an FDA approved product that could be very useful in hospitals, maternity wards, etc. My original thesis of overvaluation was based on extensive work into the potential market for the product and the competitive landscape. Product line extensions into nonmedical markets also went into the mix. The conclusion was one of overvaluation. Bulls on the stock have said that nothing is changed from a week or 2 weeks ago. To me, that is precisely the point. Still, no deal, no sales, etc. CCSI right now needs to start selling their product and to complete their LED version of their product. Bulls on the stock are just as guilty as some short sellers in overstating the bullish case. The diversion of attention attempt of the bulls on the stock has to do with overlooking the massive amount of stock that Dreyfus has likely unloaded as the primary reason for the decline. For all we know, Dreyfus may have even had people post bullish comments in order to prop the stock up so they could sell without taking a huge hit. That would clearly be bizarre, but in all my life, I have never seen any funds as bizarre as those 2 Dreyfus funds, and it amazes me that this guy still has a key to the men's room at Dreyfus. I am not suggesting that Dreyfus would or did do this, but anything is possible. As Tabadodah really Schoenberg? Is Bruce Lee living with Elvis? Who really knows? I don't, Skip, Darby, Jane, nobody knows. It is possible that Dreyfus could be totally out of their position. If you are long the stock, that would be positive for you. Over the past few months, I have come to realize that most of the stuff on SI is pretty useless noise. - on all stocks, not just this one. For all the knowledge and new insights I've gotten on stocks, I might as well have watched a 24-hr Twilight Zone Marathon on the Sci-Fi Channel. On thing is for certain, blaming ANY individual for the stock going down is totally missing the point. It ignores the Dreyfus situation (they were also big holders of Macrochem & look what that's done lately - crash & burn.) It also ignores the fact that target dates for distribution deal(s) have not been met, and those dates had been posted by bulls on the stock - so isn't the finger pointing going the wrong way? There is also a publicly traded competitor who, in their news releases state a market size for bilirubin monitoring that is a small fraction of what bulls on this stock have claimed. They have scientific advisors, but who doesn't? They did not hire Lehman as an advisor, but some people believe they did. They hired a Lehman employee. Is there a significant difference? That's for you to decide but tells me that some of you don't read very carefully. All this leaves plenty of room for controversy, so to feel aghast if someone doesn't believe the bullish argument is na‹ve. And of course, bullish or bearish depends on stock prices, and the price is a lot less than it was 2 weeks ago. There is no need for me to state where I think the stock is heading at this point - I might as well be lecturing to 3 year olds. I find it amusing that likely some people sold or shorted today based on the idea that Asensio was going to publish a short sale recommendation. The point is, if you really know your stuff - you should not care who Asensio is or isn't or what their opinion is, long or short. You should know the story better than they do. Goodnight Chet. Janybird, send me that air conditioner. PS - Buy IOCX, it's gonna fly. |
