Steve: I am sure one can call up DCHT and get that particular answer, but one can call up BB companies and get all kinds of answers, many of which are not true.
There is no penalty for lying to people who call up and ask things. There IS a penalty for submitting false documents to the SEC, so until I see a 10-K with audited numbers and the signatures of the Board at the end, I have to be agnostic about the truth of anything a BB company says.
This is especially true in DCHT's case, since the preliminary numbers that it put on its website about its 1998 results indicated so little understanding of accounting, as I discussed in my note of several months ago analyzing those numbers. The company wasn't counting the right things in calculating its gross margin and other items, so I wouldn't be so sure it is counting the right things relative to options, unregistered shares, etc., in telling people how many shares it has outstanding.
Plus, if it is on the edge of going under, then it is worth almost nothing and is actually wildly overvalued, not grossly undervalued as you suggest. I'm not saying that that is the case, but it did lose a huge amount of money in 1998 relative to what appears to have been its net worth, so that is not a far fetched concern.
In addition, there are all kinds of other things in SEC filings that are necessary for deciding whether or not a stock is worth buying, such as the verbiage relative to its products, competitive situation, patent position, etc., so until that is available, I don't see how anyone can form any opinion, other than from a technical trading point of view. |
