My sources indicate that the "1" analyst has it rated as a HOLD. Regardless, this is only one analyst. I wouldn't put too much stock in one person's opinions. It's what's going on behind closed doors that makes the difference. While I have no idea what this is, I would suppose it's increased institutional coverage and inevidable "BUY" ratings when VLNC starts producing batteries. As an R&D company, all they need to do is prove that they can produce a viable product in the short term. When this happens, VLNC will see the mid teens. When they get OEM contracts, the stock will be in the high teens to low 20s. When they ship and batteries are actually used in products, VLNC will be in the high 20s, low 30s. THEN, WE'LL HAVE TI WORRY ABOUT EARNINGS. But, until then, IF VLNC can pull off production and get OEM, this could be a no brainer!
The decline in the price is attributed to a general decline in the tech sector. Also, as I said before, it's on VERY LOW VOLUME, due to panicy short termers not willing to take a risk. Look at the historical chart: every rise is a quick 1 or 2 day up, then offset by a slow 2-3 month decline. However, since last year, the declines haven't taken us back to the original price before the rise. It's like we're taking 2 steps forward and 1 step back. We're in a ever so gentle upward price movement.
Again, by the time you wait around for anlayst coverage and buy recommendations, it'll be too late (at least for a substantial return). Read between the lines. While only one analyst officially covers VLNC, several others on on the sidelines touting the potential of this company (Wollunchuck, Wall St Dart Portfolio dude, CNBC guest...sorry I don't recall their names, but trust me that there has been very favorable comments about this company's potential).
Check out the latest 10-Q (Qtry report). I'll provide the link, but to summarize a couple important things I noticed:
sec.yahoo.com
PROS:
1) R&D increased by $2.2 million during the latest qtr "due to efforts to proceed with production in the first half of 1997!!!!
2) G&A increased by a few hundred thousand due to "higher personnel and professional services (associated with head-hunting firms, IMO).
3) Net cash available INCREASED during the qtr (mostly as a result of financing activities).
CONS:
1) From the 10Q <<During fiscal year 1994, the Company through its Dutch subsidiary, signed an agreement with the Northern Ireland Industrial
Development Board (IDB) to open an automated manufacturing plant in Northern Ireland in exchange for capital and revenue
grants from the IDB. The Company has also received offers from the IDB to receive additional grants. The grants available
under the agreement and offers, for an aggregate of up to 27,555,000, generally become available over a five year period
through October 31, 1998. As of December 29, 1996, the Company had received grants aggregating 3,978,050 reducing
remaining grants available to 23,576,950 (US. $39,885,000 as of December 29, 1996). The Company is in the process of
negotiating an extension to the October 31, 1998 committment date from the IDB.>>
While VLNC has received about 4 million of the 50 million in the grant (due to certian milestones that they have achieved), by asking for an extension, they may be "behind schedule". Again, HOWEVER, the time line comittments were established 3 years ago when VLNC was set to manufacture at that time. Thus, we're on a 3 year lag. What was suppose to happen in 1994 is happening now! (If you look at the price of VLNC then, it was in the mid teens!!!) Therefore, if you follow this, the expected "full realization" of the milestone comittments was for 5 years, which would put us into the infamous year 2000! Therefore, this CON isn't as bad as it looks!
2) The standard disclaimers. I hate these. I know nothing is for sure, so why disclose such! I realize it's an SEC thing, but it's like me putting IMO (in my opinion) after each statement I make. Well, no shit it's in my opinion! Who's else would it be!
Oh well, good luck with VLNC.
ps I also don't understand your link. It had nothing to do with VLNC. |
