The odds of receiving a 500% turnaround are pretty damn small. You think the stock will go to 30? Try Atlantic City or Las Vegas.
I think the clock is against them. Too much competitive pressure, too many investors looking elsewhere, too many customers tired of wiating for product, too many internal problems. The number of companies that have turned around like this is small, very small. It can be done, but it is a long, long, long shot, and I don't think there is enough upside or unique competitive differentiation.
Look at it from a buyer's perspective: for the sake of argument, let's say BORL makes good products. But, if BORL didn't exist, wouldn't you be able to find reasonable alternatives? IF they stopped supporting products, couldn't you still do you job? Wouldn't it be easy enough to pick up a different development tool? That's different from application software, where the switching cost is so high. IT's different from desktop software like office suites, where the cost of retraining the secretaries, execs, etc., is too much of a pain, and they don't want to learn new things.
I would be buyer at 4, because maybe I could get out at 8. |
