First sale fires up USA Video
$100M market cap
By GARRY MARR
The Financial Post
Downloading video from the Internet has never looked so
good to the market.
Shares of USA Video Interactive Corp. almost doubled
this week. The Mystic, Conn.-based firm's market cap
roared through $100-million yesterday as the company
showed its first sign of revenue.
USA Video says its Wavelet technology allows direct
streaming and download of video from the Internet, with
significantly faster images at a higher degree of resolution
than through previously available methods.
Yesterday, the company made its first sale of the new
technology to a consortium of colleges in Puerto Rico and
the United States, as well as to Enersphere.com, an
Ontario-based firm planning to provide community-based
Intranet systems. The contracts are worth just $20,000. (HOLY CHIT!!!!....WOW WEEEEEEEE!!!!....and that makes this company worth $100m ????....)
Still, the news was enough to see USA Video stock
(US/ASE) soar to a 52-week intraday high of $1.83 on the
Alberta Stock Exchange, after beginning the week trading
at less than $1. It ended the session up 36¢ at $1.77.
Almost 10 million shares changed hands on the week. In
New York, the shares (USVO/NASDAQ) also advanced
strongly, climbing 27¢ (US) to $1.22 (US).
However, analysts are a little cautious about the sharp
move. "They've been doing a lot of press and promotion (more like pump and dump)
but I'm not sure how great a story this is," said one Calgary
trader, who requested anonymity.
"I'm not sure I would want to be long on this. I really think
it's just the flavour of the month and I wouldn't be all that
comfortable trading it." He said most of yesterday's trades
were done by retail investors, but noted there were still
many large blocks in the 20,000 share range changing
hands.
"There's a pretty large float out there, so there is potential
to get burned," the trader said. The company has more than
60 million shares issued and outstanding.
However, USA Video would have none of the negative
talk after holding its annual general meeting in Vancouver,
where the firm also has offices.
"I don't talk to brokers and traders much," said Edwin
Molina, company president.
"This [Internet] market is one of the most dynamic in the
world. There are a lot of companies out there that could be
overpriced but the market will catch up to them.
"If you're managing your company right and focusing on
the right sector we could be underpriced. (ROTFLMAO....NOW THAT'S FUNNY!!!!!) It's not for me to
answer, it's the public," he said.
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