My hard-nosed assessment of INTS quarterly results, followed by my expressed concern over the CFO departure, is not a prediction that INTS will fail to succeed. It simply raises flags. If you know more details about INTS business opportunities, and can value them, them you may be absolutely correct in thinking that the stock is oversold.
A close reading of Michael Greene's post #338 should provide you with encouragement. While it does appear that INTS is having to struggle a little in the near-term to get all the new acquisitions integrated into an enterprise-wide product (using CORBA), the result may well be worth the effort. Assuming the 30% CAGR INTS management claims is realistic, you should be able to value the stock with an Intrinsic Value probably in the range of $41. Buying the stock at $26 will give you a decent amount of room for profit, especially if very big deals come along giving a boost to profits and consequently value.
If the market is the neural net I think it is, however, it is getting lots of inputs about INTS lately that are making it nervous. Unless you know better, it is risky in this situation to conclude that the market is wrong about INTS. Remember, neural nets, with lots of inputs, are better assessing these kinds of things than is a person - unless there are salient facts that a knowledgeable person can logically use to out-smart a neural net.
Before you buy, you must make sure that INTS is not suffering greater adjustment problems than currently known by management. They say their technology is great, but they have performed poorly in marketing their products. Is that true? Look for external support for your beliefs. Check out some of INTS new design wins. In other words, find the facts that you can use to beat the neural net. If you can't find sufficient facts to justify buying the stock at these prices, you should wait for more evidence, even though you may have to pay more for the stock at that time.
Allen |
