STRONG SELL Rec on SRCM, Buyer Beware
Greetings,
For those of you who do not know me, please let me introduce myself. My speciality is research. Here is an article about research I have done on two other companies I really did not like TLTK and PLSIA:
fool.com
I have spent the past few days doing a great deal of DD on SRCM. At first I bought into the AOL/MSFT/YAHOO bidding war "Buyout" rumor that has been circulating. I figured what I **believed** was their internet technology should have great appeal to the rumored Big Boy bidders. SO I went long some warrants and started doing some DD
The first red flag I encountered was this:
biz.yahoo.com
WOW - that is a bunch of selling by some LARGE shareholders. If the technology was valid I thought - why would they be selling? Heck, I figured they would have to be nuts to sell if they believed in the technology and it was as good as the rumors think it is? This alone was enough red flag for me to sell - which I did at a break even.
But it got worse...
One of the sellers was an officer, and one is the ex CFO Mike Pate. No big deal in most cases right? I called a few people who had been with SRCM, they indicated Pate was a real clean cut, "do the right thing" type of guy.
They thought he quit and sold all his stock. They also said he was the "ONLY GUY THEY FELT WAS TRUSTWORTHY WITHIN COMPANY MANAGEMENT". WOW, this was getting interesting. They said him leaving in their opinion was significant, and spoke volumes, as he was the only guy in the company they really trusted.
SO I checked out Mike Pate.... Here's what I found from a October 6, 97 SEC filing:
edgar-online.com
Chief Financial Officer and Treasurer (principal financial Michael G. Pate and accounting officer)
Sure enough, my ex SRCM guy was right he was the ex CFO. So far this source had given me good info for everything I could confirm... And none of what he gave me was good for a long position...
So I did a little more digging... And guess what? SRCM started looking worse and worse....
More to come...
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