Good idea to change the thread Skye. I have a few points to make at the moment. There are negatives here associated with management, and we have heard these, but there are also many positives IF things works out. The idea of dropping Java is just plain ridiculous. Cowpland has been a visionary at least a couple of times, it COULD be third time lucky.
Anyway, what I wanted to point out is the fact that in terms of giving the co. better focus and more credibility with the investment community, this company has in fact LISTENED and REACTED on several counts this year. On this thread, and more to the point, various analysts (eg. Marleau Lemire has their review of Canadian tech companies on the Ottawa Business Journal home page), several suggestions have been made to increase focus, enhance credibility, and boost shareholder value. The company has ACTED on these.
1. Spinoffs. There have been two major ones. Corel Computer Corp, a new subsidiary, will focus on hardware and videoconferencing. It will probably get its own financing, and its early losses will not be reflected in Corel's bottom line. The second is the decision to farm out the educational software business. Corel gets a bit of cash up front, an equity stake in Hoffmann and associates, and future royalties. And most of all, it doesn't lose focus.
2. U.S. Accounting Principles. The company will adopt these very soon as requested by shareholders. This will boost the reported EPS numbers so there will no longer be any unfair disadvantage.
3. Niche markets. They know they sell better in some professions, so they have developed specialized suites.
4. Advertising. Costs are being cut back. The company gets a lot of publicity from its various strategic alliances, and is in the news a lot. The early investment in advertising may pay off in terms of EPS if the costs are reined in.
5. Franchise. The company is making sure we hear about the names Wordperfect and Corel Draw as much as possible. This is better than some of the old "Perfectoffice" (cumbersome) and "Office" (MSFT).
The story has not changed, but the stock price has dropped. People always react more loudly when this happens, but as Mike Burry and others have posted, there is no CLEAR reasons for the stock dropping, just a variety of reasons which are pretty evident. Fear of Microsoft and its whopping recent earnings, a NASDAQ bear market, and lack of confidence in management and its credibility especially with regard to earnings, A/R, and so on.
Now Cowpland didn't have to say "We're Finished" if Java doesn't pan out...but he knows his business. The retail market won't get COSFF to $100, ever, but strategic alliances in the corporate arena just might.
I understand most of the criticisms. But just as one shouldn't be burned by investing in a concept, one shouldn't avoid investing based on a concept (in this case, the idea that Microsoft's good results mean death for all concerned).
Agree with Mauro---"the game isn't over". |
