Watching Ascend today it like watching paint dry...Thanks Mory
Finder, I agree, it is a boring day for Ascend (so far). The worst part is that Ascend has now filled the recently created gap, and everyone is curious to see which way it goes.
My take on Ascend is still bearish. I am still short but holding protective calls. My reasons for being short are:
1. credibility problem (thanks Mory)
2. earnings shortfall
3. product problems
I know that the earnings shortfall and product problems have been addressed by many on this thread. Earnings problems have been explained by back end loaded quarters and now by deferred earnings. Europe will come off vacation, etc. And the product problems have been fixed. But (IMO), for Ascend to rise in price, they have to start walking the talk. And that's going to take some time.
Ascend's CEO has been caught in some deceptive statements regarding customer base. The credibility problem has to hurt Ascend.
So, what I see here is a triple confirmation for the short seller.
Additionally, Donaldson, Lufkin & Jenrette made the following statements in their 9/30 release:
1. main concern is continued mis-executions on product cycles
2. growing competition from Cisco and 3Com
3. companies revenues are concentrated in several hundred customers
4. Cisco, Bay and Cabletron all have over 10,000 customers
5. All companies mis-execute in some ways, but Ascend's low diversification exagerates the company's mis-steps.
Let's hope for the best, I am still an Ascend fan.
Harry |
