JDN, I was at that Westergaard Conference in New York. That's where I first met the principals of ALYD and realized how fervent they were about being the best.
There are four stages, IMO, to this Y2K "madness". Stage 1 was "Show me the Tool", where any company that was purported to have developed a killer app was rewarded with an outrageous share price. Most of these companies were the do-it-yourself tool vendors because they mostly just identified the problems but didn't really fix them. When ZITL made a splash by telling people their tool could fix the problem, they skyrocketed.
Stage 2 is "Show me the Contracts". This phase started at the beginning of this year. ZITL had only one and fell to earth. The companies that first got the contracts were the body shops, like IMR, because they already had a track record as a programming house. Although I could see ALYD had a good thing going for it ever since the $20M SAIC contract and the five Fortune 500 beta test sites, it was not until they announced contracts that the stock took off.
Stage 3 is "Show me the Money". It's hard to tell exactly when this phase will begin, but I have to think it's getting real close. Companies like ALYD are being driven by speculators, like us. Once they show real earnings, the price should stabilize between contracts since the "average" investor is less likely to panic when they see the numbers are in their favor. Nobody expects stellar earnings at this point, only enough that indicates there's meat in the contracts.
Stage 4 is "Show me the Growth". There's plenty of Y2K work for everyone, but at some point investors are going to look at the humongous P/E ratios and start wondering which companies really deserve them.
Conclusion:
Until ALYD gets on the NASDAQ, shows some decent earnings and the funds buy in, the stock will fluctuate wildly. If you're in this or any Y2K stock to make a quick buck-- good luck because you're gonna need it -- but it is my opinion that if you have the stomach to be long ALYD, you will be handsomely rewarded.
I hope people realize what I've just said is a "forward-looking" statement which, simply put, is one person's opinion. Investors should keep in mind that this is, after all, the ALYD thread, so we are not without bias. However, if you read the early posts, you'll see we have a pretty good track record.
There. Every thread needs a disclaimer now and then. Now I can continue to make forward-looking statements with a clear conscience (gg).
- Jeff |
