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Strategies & Market Trends : Range Bound & Undervalued Quality Stocks
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To: Jane4IceCream who wrote (1661)3/31/2000 11:36:00 AM
From: BWAC  Read Replies (2) of 5499
 
So what is it about these online brokers? I am becoming more and more confident that there will soon be some very hung short positions. Especially at AMTD. Look at today's volume. Very low. Everytime the volume gets low on a selloff the price seems to move up soon after.

Record volume, record account growth, 100% revenue growth, but the focus is on earnings (Why?, It's not the foucs anywhere else?). In fact, the focus is so much on lack of earnings that they can't see the incredible amount of "earnings" being reinvested into advertising.

AMTD spent around $60 Million on ads, with revenue of only 110,000 Million last quarter. Hell that's a 50% plus ad budget. Cut ads to 40 Million and they are breakeven. Cut ads to 20 Million and they are profitable. Raise revenues by greatly gaining customers from the 60 Million ads and they may just soon be very profitable. This is easy stuff. It's not rocket science. It's the simplest of all income statements to estimate.

And just when did it become "smart" for a growing business to show a profit and pay 35% of that profit to Uncle Sam, at the expense of the growth plan and rate of growth? The advertising may be a bit extreme, but I personally would rather they spend the profits on advertising and growing the customer base than showing a profit and paying income tax. Because the income tax paid of 35% + is money that COULD have been better used to grow the business.

I just don't understand?
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