Katz, the "nifty fifty" list has simply been shrinking of late. The nifty fifty comprised several hundred companies last year, but the steady shrinkage has trimmed the list to even less than fifty so far this year.
Vrio was hanging onto the coat-tails of the nifty fifty through Feb., but now it has fallen away. Sure, they beat estimates, but it just was not good enough. I didn't want to do it, but I bailed from this stock at $69 (day after report) Of course I should not have kept holding when it was plenty of times at $80, but due to the harsh sell-off after "earnings" were reported, I could see that this stock was falling off the list of favored cos.
Unfortunately this co. is lacking in key areas:
The CEO is so dull as to be unknown and unseen by investors. Compare that with Larry Ellison or Michael Dell, etc. The street likes charismatic CEOs.
And of course, this co. lacks earnings. That is forgiven if sales are doubling (at minimum) on annual basis, but that's not the case here. The co is obviously painfully aware of how disappointed this era's investors are with VRIO's sales:
Tuesday March 7, 12:25 pm Eastern Time
Verio CFO sees rev growth rate jumps in 2000, 2001
NEW YORK, March 7 (Reuters) - Verio Inc. (NasdaqNM:VRIO - news) Chief Financial Officer Peter Fritzinger said on Tuesday he sees year-over-year revenue growth increasing
to 60 percent in 2000, up from 40 percent in 1999.
``That's organic growth, not including acquisitions, which we're planning,' he said, speaking to investors at the PaineWebber Internet Conference here.
Verio, which provides web site management to small and medium sized businesses, would have revenue growth of 70 percent in 2001, he said."
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Promises, promises. Besides, there are thousands of cos with that kind of revenue growth.
For myself, I was thinking that sales growth (and maybe the profit side of things) would be not just some better than expected, but a lot better. At any rate, it was a profitable hold for me, and I didn't marry the stock, so I decided to leave for at least the next few months. The stock had obviously ramped up leading into the report, so I will wait and see how low it goes. No hurry here, it's not going to run away from me.
Funny thing, but INTU did the exact same thing to me, in the same week I think. I took the hint on that one also. These are just small signs of underlying weakness, and the narrowing of the nifty fifty list.
Perhaps before the Naz is broken, we'll all be long only RMBS and ARBA. :-) |
