>>>What's going on here?<<<
First, you have to remember that even at $21, this stock has almost TRIPLED since February, when it came public at $8. How many stocks do you know that have increased in value by 162% in the last 10 months? I love it when guys like phbolton and Don Kelly pop onto a thread like this and ridicule the performance of a stock that has increased by 162% over ten months, based solely on its movement the last 30 days. Attention deficit disorder, I guess.
Now back to your question. Here's what's going on:
1. Seec is a highly speculative issue. It could go to $100, or it could go back to $8. That uncertainty weighs on the stock price.
2. The stock ran up to 37 after first quarter earnings, when Seec reported 13 cents a share. I think lots of investors jumped on board when they saw that humongo number (see the quotes from The Street.com in my previous post), without realizing that it was mainly the result of a one-time gain on a royalty payment from Viasoft.
3. Because of #2, investors weren't impressed with the 4 cents that were reported in Q2, even though it handily beat estimates.
4. When you look up Seec on the charts, it says PE = 683 (not sure where phbolton gets "40+"). Needless to say, that tends to scare off investors who are risk-averse.
5. Last week, Seec announced a secondary offering, which will be dilutive. That didn't help the stock price.
I don't think anyone has a clue where this thing is going, but my guess is that you won't see a lot of upwards movement until the company begins to deliver on its potential, which will hopefully begin with next quarter's earnings. However, from what I've read, the big time Y2K revenues -- if they are ever to materialize -- won't hit until 1998, which would put Seec's day of reckoning somewhere in the company's FY '98 fourth quarter.
On the other hand, it feels like Seec is forming a bottom in the $20-21 range, which is probably the result of the fact that most of the shares are now in the strong hands of insiders and the clients of companies that brought it public -- H.C. Wainright and ... I can't remember the other one.
Regarding the Viasoft agreement -- I don't think there is one. My understanding is that the Q1 royalty was a one-time event.
However, I don't think phbolton knows what he's talking about when he says that Seec "is fighting" with Viasoft. Otherwise, he would have answered my post or the e-mail message that I sent him. |
