Thanks for the insights. I will be judicious about bringing up the r-word.
As far as my complaints toward the Newman's secrecy, in two press releases which were printed probably nine months ago they announced they had signed contracts to purchase a minimum of 25,000 seats of speech-recognition software in 1999. I 'did some math' and bought a few extra warrants, expecting maybe $100,000,000 in sales for the year.
Later, after noticing that things seemed to be going 'slowly', I emailed them and asked about apparent discrepancies in the big numbers and rosy press releases. No reply. I emailed again. No reply. Things were not making sense. I started posting my concerns on S.I. By this time they had been claiming $40,000,000 but it was appearing to be an empty promise in my eyes. It took many months, until just recently, that they started to back away from the $40M claim. To many people this was very tardy, as they had been using intimidation (i.e.: "do the math", etc) on those who dared question the numbers until just recently.
They were keeping the stock price artificially high because they had to know sales were sluggish but were painting a rosy picture to investors. The logic in this action still has me curious. Presently, I suspect it was so they could sell shares into the market to keep business running. In retrospect, those "25,000-seat" press releases were empty of content, except to disseminate the concept of huge sales. If they had any real substance, it would be reasonable to re-release them with corrected numbers. But, lacking substance, there is no reason to offer corrected numbers.
Overly optimistic opinions by management is understandable, but most investors seem to feel they overstepped their bounds and actually may have been deceptive. The only logical alternative is they would be inept, and that's a tougher sell. Hence, I believe the present price and price trend is driven not just by lack of sales, but by lack of confidence. Investors, I suspect, would be more understanding toward start-up delays if we felt we management was feeding us at least a 'foggy' idea of what was going on.
For now I view this stock as promising down the road, but find I am uncomfortable about buying back in right now. I do appreciate that Xybernaut has taught me a lot, and continues to make me wiser, as I no longer take press releases at face value.
Good luck,
Shoe. |
