I personally don't believe there is any reason based on the company's fundamentals or rumors about that would explain the drop in price on Thursday. Just looks like the shorts took a couple of shots at this issue with moderate success or perhaps market makers know of some excellent pending news and wanted to kick in a few sales orders and get some more shares cheap. Based on the response of the price to these attacks, I feel even more confident in the prospect for this stock. The return from $8- to $9+ midday shows extreme confidence on the part of those buying and I only regret not having cash available or I would have been in there with them.
There was news at CCSI (you might check their thread) on a Buy recommendation from Market Trim Tabs prior to the drop and a 13G filed by Mellon Bank (afterwards, I believe). Unfortunately, with SPRX at an all-time high on Wednesday and the news out of CCSI, along with a stock value for SPRX based on anticipation solely (i.e., no solid earnings to base stock value on), we became a prime target for shorting. This should change quickly with the next earnings report as I believe we will finally see some earnings and a forecast for the coming quarters. If the news is good, and I feel it will be, the price for this stock should start to climb. If not, we just wait another quarter.
Personally, I remain extremely bullish on SPRX. Compare SPRX against CCSI. CCSI has FDA approval for their Colormate in the US while SPRX does not have it for BiliCheck. This, as I see it, is the only positive factor for CCSI!
Meanwhile, SPRX has and continues to develop products in cooperation with major medical companies (more importantly, major medical companies continue to work with SPRX) while CCSI continues to state that private negotiations continue on a distribution deal with undisclosed major medical companies. Neither CCSI or SPRX has the size or the financial resources to efficiently go after this market and a major playing partner is a requirement for success (no doctor or hospital likes to buy clinical equipment from a startup company, they like to buy from the big guys). Working relationships speak for themselves. Talk or rumor of a deal is a crap shoot at best.
Second, I am an engineer, and had interviewed with SPRX back in 92/93. I was extremely impressed with Mr. Samuels and others on the staff and was equally impressed with their projects. Compare that against my instant sense that something was awry with the technology at BioControl Technologies (BICO, non-invasive blood sugar measurement device) when I interviewed there and passed on that opportunity. You can follow the links from the SPRX pages to some of the related diabetes pages for more news on what happened there and elsewhere. There is a lot of money to be made for non/minimally invasive medical technologies and one would expect to encounter 'traveling elixir salesmen' in this environment. This has already been proven in the diabetes market.
Third, SPRX has money in the bank and is building up a manufacturing facility (now running). CCSI appears to have neither.
Personally, I'm looking to hold onto my 500 shares for some time and am waiting for a good exit point on stock options I hold with my present employer in order to get more SPRX and diversify. For those investing in SPRX out there, hang in there. I believe we will all be well rewarded in time, but the next 1-6 months may be a little bumpy (or looking at the positive side, there may be some excellent opportunities to get more at low prices). Whichever company gets these products out successfully first is looking at some major revenue! |
