ALL I DID WAS ASK DEFINE LARGE?
AND WHAT HAPPENS IF I LOSE MY PHONE AND SOMEONE MAKES UNAUTHORIZED TRANSACTIONS WITH MY PHONE< HE SAID ID BE RESPONSIBLE, THAT DOESNT SOUNFD VERY GOOD TO ME.
Someone Oughta Call Security
If there was ever a reason not to buy a stock based on technicals, it is the tiny Toronto-based Internet stock Diversinet (DVNT:Nasdaq). The chart of this stock, which has risen to 11 from 3 this year, is a thing of beauty. But a testy presentation filled with ravenous short-sellers was downright ugly.
Diversinet offers digital certificates for the hottest area of e-commerce -- no, not Pokemon auctions, but wireless Internet. The presentations here at AEA were crowded with investors hoping for another four-bagger. But although CEO Nagy Moustafa kept displaying slides with Palm Pilots, Nokia (NOK:NYSE ADR) phones, Motorola (MOT:NYSE) pagers and logos from BellSouth (BLS:NYSE), he offered little evidence that the company is closing deals with those companies. More egregious was a remarkable dearth of numbers. As Moustafa dragged on, investors began to get up and walk out of the room.
"Our applications," he said, "will work with Palm to develop authentication over the BellSouth network..." One testy fund manager interrupted. "But I already have a Palm VII and can trade my DLJ account without your product," he said. "Do you actually have a deal with Palm?"
"We have a relationship with BellSouth," Moustafa said. "They are looking at Palm."
It got worse from there. Another slide highlighted research and development. Said Moustafa: "There is a large investment in R&D..."
"Define large," a money manager interrupted.
"Large? It's very big," Moustafa said.
"Define large," the manager persisted.
"How about $10 to $15 million?" Moustafa said.
On further review (as they say in the NFL) it came out that a guy who used to run Diversinet (back when it was called Instant Publisher) bought the central technology in 1996 for $10 million. Where is that guy now? "He's gone," Moustafa said without further explanation.
Another short-seller asked about a former associate of the company named Bobby Genovese.
"Who is Bobby Genovese?" Moustafa asked.
"Wasn't he in company management?" the money manager asked.
"Bobby Genovese is a former investor relations person who is no longer affiliated with the company," Moustafa said tersely, his memory suddenly on the mend.
Amazingly, Moustafa concluded his presentation without any slides addressing past revenue, earnings, margins or any other basic financial information. Investors left the room shaking their heads. |
