Wall Street is so manic depressive about this stock it is pathetic.
When it first came out, everyone thought Netscape was the greatest thing since sliced bread, and it went to 87. Then Gates did his Pearl Harbor number, started naming software after major battles of World War II (he should have named IE "Dunkirk"), and Netscape went in the toilet.
Then Netscape did its secondary, they did a road show, it revamped its strategy and looked like it might hold Microsoft off a while longer (funny how those browser stats continue to levitate), and Wall Street decided it would stay faithful after all.
Well, here we go again. Gates asks the rhetorical question: "Can you say "Active Desktop?" and Wall Street decides it hates Netscape again and starts thinking of ALL the reasons to dump it into the market. I'll never forget the one day not long ago when the stock dropped 10 points in one day!
Now, we're at the low end of the depressive cycle again. All the analysts who three months ago had Netscape on their "Ten greatest stocks of all time" lists would not touch it now. We have the "product transition woes." Netscape can't keep growing at 100 percent a year forever, the anaysts say, because it needs to spend more money on R&D for new products. Furthermore, everyone is talking about how Netscape needs a partner, Oracle, IBM, ANYBODY to help it hold up in case Gates sneezes in the wrong direction. I guess a walker, crutches and a wheel chair are next on the list of things Wall Street thinks Netscape needs even to get across the street.
I predict that Netscape WILL meet earnings estimates -- and that right now is a good time to buy this stock. If the company does not meet estimates, people are so depressed about the company, and the stock is already so trashed, it will not matter. If, as I predict, it does meet or exceed estimates, that fact will cause a nice, unexpected bump up in the price which will take us once again to the manic phase of Wall Street's bi-polar attitude towards this company.
In any event, Wall Street should just take a valium, lie down, and try to be calm when it comes to this stock. |
