Carolyn, re. "Long term prospects?", they appear quite good. These explosive bursts (today's repeated one like it of a week or so ago) are indicative of six factors at play.
First, Interphase is in a very hot sector of companies producing components for systems designed to store and retrieve the enormous amounts of digital data generated by the computer societies growing up about us. Fibre channel technology has caught on as an engine of those systems, as it can propel data far and fast enabling companies to build storage farms several kilometers distant from their offices, if they want. These storage area networks (SAN) promise solutions for our historical propensity for keeping and finding the records of our transactions at a time when those transactions are multiplying like rabbits and deer.
Second, Interphase does not have legions of competitors in its niche of the fibre channel marketplace--Emulex is one; JNI another; Qlogic, among others--making fibre channel host adapters.
Third, Interphase was late to be discovered by larger investors blinded by the IPO stardom of some fibre channel companies like JNI and Brocade (fc switch maker) and the brilliant recent rise of little Ancor Communications (rival and ultimately superior [a little Ancor cheer leading for a shameless Ancor long] switch maker to Brocade).
Fourth, Interphase makes money, unlike some of the fc companies with higher market cap, and more money than some other fc companies with higher market cap. Its latest quarterly performance showed itself as a rising fc player, for the first time generating more (60 percent of total) revenue with its fc products than by its other products. And the fc revenue increased 368 percent year over year.
Fifth, astoundingly for a company founded in 1974, Interphase still has only about 6 million shares, not all of which are floating around for investors to play with. This exacerbates the normal market rising effect on stock price when investors dearly want to own those shares and the falling effect when incredulous investors want to take their profits and swallow the short term tax consequences. That happened to the ?good natured? jeers of those shorting the stock after the last big increase.
Sixth, all the above plus newly announced products, the recent Fibre Channel Developers Conference, and the stage afforded by Comdex have helped focus investor attention on Interphase and propel its stock price to these still wobbly heights.
In my opinion, long term prospects remain quite good, while the short term activity continues to lurch back and forth and steadily upward. That's my perspective, at least.
Starowl |
