Ilike ARBA (and CMRC as well), but I fear this sector of the market is going to suffer. With a market cap of $30 B, if anything goes wrong, the road down for ARBA (and CMRC as well) might be tough. Remember that from here on, getting money through secondaries might be tough. I figure that in this respect ARBA is slightly better off than CMRC (they have a little more cash), but both are burning about $50 MM per quarter, and since they are still in a major growth spurt, they may need even more money. They are not going to generate cash for at least another three quarters (maybe even more), so they may run into cash crunch like AMZN has, and we all know what happened to AMZN.
Having said all that, these two are prime I-net companies which could have revenues in the billions in coming years, still paying $30 B for a company with maybe $1-2 B in sales next year, with the spectre of a bear market coming, is "gutsy".
I'll play CMRC but I think I'll leave ARBA to those having more guts. CMRC's market cap is only 1/3 that of ARBA but sales rate are not far behind ARBA.
Zeev |
