Addi, my ideas for the price decline
1. RMII is certainly being punished for association with the ISP market, and being second tier never helps on the downturn.
2. 8/9/99 will certainly report *lack of earnings* for this quarter,
3. Yahoo reports RMII's yearly revenues at $16.8 million, yet $25 million in revenues has been *added via acquisitions* in the past 12 months, so financial information is not up to date.
4. Maybe it's market timing but Wall Street hasn't been impressed with RMII's spending spree. If operating losses continue and the stock used for acquisitions dries up, RMII will need financial backing to continue their growth.
5. with no analyst coverage, who's going to project, when the operating losses will turn into profits.
I called RMII today and they were very tight lipped. I ask about new upcoming technology, earnings, reasons for price decline, new business acquisitions, upcoming analyst coverage, buyout offers , mergers, future target for projected earnings...
RMII's response was always "We can't give out that information wait for the 8/9/99 reporting".
In hopes of a conversation I tried the "Devil's Advocate"
Question: "Let's say the big ISP players, (I used US West /QWEST since they are also HQ in Denver), wanted to low ball ISP monthly fees for a couple of years and put the RMII's out of business or maybe buy RMII, how does RMII see themselves in this market long term."
my recollection of the response: RMII recognizes that customer service is a more important selection criteria than price for new ISP customers. US West is known for terrible customer service. RMII is positioning themselves in the market to be more responsive to customer needs than larger companies. Positioning themselves to offer full service ISP, web hosting and E-business applications to small and medium sized businesses.
Many of the regional ISP companies recently acquired by RMII have loyal customers and also offer good service. The acquistions have brought many new assets to RMII, many new customers, new technology and many talented employees ie. Dave's World has brought some technology gurus into RMII.
RMII is working to overcome the fragmented image casued by all the acquisitions and intergrate all the new services into a new comprehensive business/marketing plan. Wall Street perceives RMII as a Rocky Mountain ISP. RMII's new Oklahoma ISP customers are still loyal to the regional OK ISP.
RMII is currently contacting all customers, residental and business making inquires and offering their new package of web development, webhosting and E-Business services.
Hansen and Vicker have been making presentations to financial institutions and brokerage houses, so RMII expects to show up on more Wall Street radar screens in the future. RMII feels the stock is undervalued and their response to this marketing effort has been good.
personal footnote, somewhere in between the "we can't give out that information, I believe there was a smile and chuckle when ask about *new technology in the works* and *maybe a soon* on the analyst coverage.
Cheers, |
