MGV, first, the NAZ is up less than 20% from bottom and VLNC is up 27% from its bottom (the low was at $11 on the current bear move). Many "good stocks" with positive cash flow had declines exceeding 75%, so even comparatively, VLNC is doing "better". Because VLNC has a beta twice that of of the naz, if this advance continues, I expect VLNC to advance more than the market. If it does not, well that is what stop losses are for. I find that a depressed stock may often give you a 50 % bounce from an oversold condition (yesterday I bought CDTS at $8.75 and sold today at $13-5/8 for a 56% gain, my point is that VLNC could easily achieve a similar short term move (to $21). CDTS, by the way, has similar problems and opportunities to those of VLNC, they are still heavily negative cash flow, but there is an outside chance that they will become positive cash flow within the next four quarters.
Good luck to you.
Zeev |
