(Management's Job)
You asked what management's job is in situations like this.
Management's job is to AVOID situations like this by having a sensible and consistent communication strategy with Wall Street and the shareholder community. Running silent is not the answer.
In the past AMTX management has (perhaps unintentionally) communicated informally with shareholders, hinting at current developments, etc.
These "leaks" have set expectations among many of us here, and influenced buying/selling decisions, much to the detriment of many.
Management's job ultimately is to benefit the shareholders by making the stock more valuable, but we all know that.
After watching my own company's stock rise from under $2/share (split adjusted) to about $70 currently, I can tell you that two things Wall Street values are consistency in earnings performance (i.e. predictability of performance), and relative strength (which also is created and increased by predictability, but of stock price, not earnings performance).
Management should be paying attention to at least these two factors if they are appropriately looking after shareholder interests.
Unfortunately, their methods of communicating information to shareholders is so inconsistent that it creates wild swings in the stock's price - which negatively affects the relative strength of the stock and its price predictability.
As well, I think they need to leverage their "partners" - get them to spend some money promoting and publicizing the relationship, and make announcements mentioning Amati by name and not subtle inference. For instance, I think they need to bludgeon NEC into an announcement regarding the VDSL deal in Hong Kong, and Amati's role in the deal.
I also believe enough time has passed and that they owe the shareholders an explanation as to the status (or results) of any deal with Alcatel.
As for what the MMs are doing now - my opinion (pretty much solidly paranoid now) - the MMs are pretty much taking this issue private among themselves. This would allow them to virtually re-IPO this baby when news of a deal really appears. I think they're going to shake the trees real hard for as long as they can to shake out weak hands. We'll know this phase is over when the price stabilizes and volume dries up. I think there may be some of us willing to hold this stock at levels below 9 - but not many. I think the price could go SIGNIFICANTLY lower than 9.
With the new NASDAQ rules on price quotes going into effect this year, this may be one of the few killer opportunities for the MMs to make big numbers.
Just my $.01. Used to be $.02, but my ADSL portfolio is hurting bad right now. |
