Re: turnaround?
Yes. 2 perspectives from someone who has only the vaguest notion about the underlying business or technology of either the telecom industry in general or BBTK in particular.
First, a view from 50,000 feet. A company is in the tank, has technology but its products stymied, debt mounting, revenues dropping. Major industry player arrives on scene; recognizes value; puts together a partnership/licensing agreement with financing sufficient to eradicate the prevailing threat of dissolution. This scenario, in pure business terms, is a WATERSHED EVENT (if it is for real once you get under the covers); the direction for the future has been set and it is positive.
Second, on the technicals: if you look at the chart since the LU announcement, you'll see bubbles of sudden interest followed by skepticism. In light of the above scenario, the bubbles are what's important, because they represent sudden realizations by investors that the LU deal IS real - i.e., that it has not only truly bailed out the company but also has permitted it to start growing again, both in LU and in non-LU areas. The periods of skepticism represent the normal human behavior of 'getting-out-because-I've-made-SOME-of-my-money-back', and should be looked at as possible buying opportunities. This week's rapid-fire drop and subsequent very strong recovery (highest close since mid-October) lends credence, in my view, to the notion that the overriding direction of the stock is Up. As postulated before, a close over 8 3/8 could easily generate a run, probably choppy, to high 11's.
Incidentally, lending support to the possibility you raised of an imminent news announcement: over 80% of Friday's volume occurred in the last 1 1/2 hours of trading.
Mike Harvey |
