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Microcap & Penny Stocks : LEAP - Innovative ad agency a bargain at $3/shr?
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To: Andrew Hunter who wrote ()6/20/1998 4:54:00 PM
From: James Wright  Read Replies (2) of 600
 
On June 2nd, I predicted on this message board: "There may be a short term momentum play on unrealistic expectations of profits leading up to the earnings report, but if you play that game then please be sure to sell the day before the earnings actually come out. You know the saying -- buy on rumor, sell on news!"

Looks like that's exactly what happened -- LEAP had a short run up before earnings to 3 3/8, but now is dropping quickly toward its prior support level of 2 3/8. If LEAP breaks below that support level, it will keep on dropping because there will be no support left. My best guess is that this will happen next week.

Also, it is becoming increasingly clear that LEAP's client base has thinned out to the bear minimum. This draws the company's long term viability into question. I think it will pick up clients, but I'm not willing to bet on LEAP at this time, even at the current price. Until LEAP shows realistic prospects of real, consistent profits from more than cost cutting (brought about last quarter by decimating its staff levels -- how's that for motivating creativity? -- and slashing executive pay), or until LEAP announces significant new clients, I see no prospect of any real rise in the price of LEAP given the weakness of the stock from a technical perspective.

Still waiting for a bottom . . .

-- Jim Wright
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