WELL we got a Newsletter shorting it now
TheTrutheeker.com Announces Investment Opinion on Perle
Systems
TheTrutheeker.com Announces Investment Opinion on Perle Systems
NEWTON, N.J., Dec 10, 1999 (BUSINESS WIRE) -- The Truthseeker
initiates coverage on Perle Systems (NASDQ: PERL) with a immediate
sell/short sell and a price target of 2.
Perle Systems is being mistaken by daytraders as a "LINUX play" as
though its products have anything to do with the current market
interest in the free LINUX operating system. Nothing could be further
from the truth. Its announced LINUX and Windows drivers for its boards
is a NONEVENT, and adds nothing to the market value of the company.
Perle sells hardware boards which enable serial connections when
plugged into a computer. Its products support dial-up connections via
modem, ISDN, T1 or E1 connections. Its boards are not proprietary --
there are numerous competitors in this market, and Perle's offerings
are basically commodity items, not protected by patent or other barrier
to entry. Named competitors include Shiva, Cisco, Ascend, Digi
International and 3Com, as well as a numerous others.
The company uses the same magical phrase describing its products:
"Remote Access Solutions" as a fluffy synonym for the ho-hum words
"modems" or "serial port communications connection." But the meaning is
the same. Ariel Corp. (ADSP) used exactly the same language last week,
when daytraders pumped a 4 dollar stock as high as 55. It is now
trading at 11 dollars per share.
There is further source of confusion in the name "Perle." PERL is a
computer scripting language used in UNIX, mostly used years ago in
early website construction before more sophisticated development tools
and languages were developed. There is absolutely no connection between
this programming language and Perle Systems.
The company's working capital has fallen 75%, to $3.3M. Net profit was
$1.3M Canadian, or appx. .17 per share. However, applying US GAAP
accounting standards, net loss was $1.1M and loss was .15 cents per
share, due to write-off of in-process research related to an
acquisition.
In summary, Perle Systems is an unremarkable serial card and terminal
connectivity board manufacturer. It sells its products with drivers for
all major operating systems, and does not stand to profit in any
dramatic way by an increase in Linux's market penetration at Windows'
expense.
Current market valuation is based on daytrader speculation only, and
the stock will soon return to its historic levels -- appx. 2 dollars
per share.
Buyer Beware!!
Please visit our site at thetruthseeker.com for full
details.
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