Al,
Something very significant has changed. The board (Arnie and others) have been arguing about NXTL's value. Market price, on the other hand, is a different story, determined by demand and supply. In theory, behind the demand and supply are value assessments, but as we all know, the correlation between price and value is not always there.
With the S&P500 addition the demand/supply has changed dramatically. For right or for wrong, yesterday, millions of shares moved, mechanically, into "firm" hands. That is, all the funds that either invest in the S&P500 index, or replicate this index. These shares will stay with these funds under most circumstances. This is what upset the demand/supply situation. Is it worth $3? Why not? Add to that a technically favorable situation and, there you have it. One can argue, that in one big step, value and price converged (or came closer). Arnie would argue that the gap closed a bit.
In the meantime we can debate as to whether NXTL's value has changed until the cows come home.
Tavros |
