MGV, stocks like VLNC or CDTS or SCON are not necessarily valued based on actual sales, but on potential sales over the next few years. CDTS, for instance vaulted today because of a relatively small order, that order itself is not going to get them to the promised land of positive cash flow (and valuation yardsticks as you propose), but, such an order validates the belief that much larger orders are in the wings. I think that what ails VLNC right now is the relatively long lapse between the initial orders and other PO from new customers, not so much the fact that currently their sales rate is quite low. Technically speaking, the stock is defending valiantly its support just around $15.5, and even a short excursion to $14.5 (the most recent through) will not violate the basing pattern, IMHO. A "print" above $17.5 or so, may indicate another attempt to rally might be in process, if you are short, that is where you would want to put your stop loss, if you are long, a SL just under $14.5 would probably be called for. I am flat, thus both are irrelevant now.
Zeev |
