The real difference is the taxation of earnings. The year over year comparisons by way of revenue and gross profit remain strong, but the net income comparions remain poor because of the 12% v. 34% tax rate situation. Did the analysts realize that this was coming, and coming so quickly -- probably not since I have little respect for them, particularly someone who downgrades because revenue Q over Q is only 21% increase, and not the 30% increase expected. That little problem would have been solved by closing one or two more deals, and that "analyst" probably would have reiterated strong buy. At least this time around, people other than analysts were allowed on the post-press release conference call to even things out just a bit.
I agree with you that this stock is a broken stock in terms of momentum; however, small caps will have their day shortly, and this is one of those appealing small caps having a growth rate which is 2X the PE. Moreover, while there is discussion by competitors about a slowing market, is that what it is -- or just a market in which Davox is increasing market share? Wasn't it just two weeks ago that a new company in this area came public with announcements of serious growth expectations in this market segment?
In for the long haul because the company is great, product is great, and the company is unafraid to make decisions. |
