A couple of points many of you seem to overlook:
1) This huge loss will chew up substantial cash. Many posters keep pointing to BORL's vaunted $2/share or whatever. Well, they ain't gonna have no $2/share after this quarter! That will affect the stock, and will affect their ability to build a marketing program going forward. I bet they'll have 1/2 the cash, maybe less, at the end of this quarter that they had at the end of last quarter.
2)The law suit will have some affect - will chew up still more cash (lawyers, settlement), and chew up a substantial amount of management time. That's time that should be spent running the company and turning it around. Maybe chews away another 5-10% of the company.
3) Institutional investors and less sophisticated investors will see law suit and see cash flowing away and run from the stock. What mutual fund manager in his right mind would take a chance on BORL? It's just too out of favor.
4) Corporate decision-makers will also run away. Big companies don't like to buy products from controversial vendors. They see a company losing money, involved in lawsuits, and they think, "Why risk the political heat if something goes wrong?" Now, not everyone thinks that way, but enough do to have a further impact on sales.
The whole situation is a slippery slope, feeding on itself.
I think we'll see 4 long before we see 8. If high techs go out of favor for a few weeks, we could see 3, but that's a long shot, but maybe not with tax selling. |
