David, be careful. This isn't like KTEL, MARG, or SEVL. The news is decidedly mixed, and my guess is the price action is entirely a consequence of day trading. Remember, day traders are fickle. Yes, the company will remain in business, and in a couple of months it may have an unproven product to sell. Of course the market looks ahead, and it's conceivable the price appreciation will hold. But far more important, to my mind, is the share dilution. As the Briefing blurb says, the company is issuing a big wad of stock at $0.60. I can't see how this will help the stock price in the near term. In fact, call me cynical, but I'm inclined to view the market maker opening price, which was around 1 3/4, as a bull trap. The market makers can and very well may short this stock. Think about it: if you were a market maker and could short naked, and you saw a jump in volume because of news (Herring, Wired, and PR) that will cause the supply of shares to increase, what would you do? I'd be likely to short. But this is all a guessing game. The market will do what it wants to do, but Briefing is right to advise speculators on the risk of this stock. Personally, I'd rather wait a few days, at which time I suspect the stock will be back under a dollar, before buying. If I'm wrong, I'll buy in later, at a higher price, but that's how it goes. At present this strikes me as too tricky to play.
Good luck. J |
