Adam: Thanks for the succinct and on-the-mark summary of Adaptec's current situation. Regarding your comment on needing a top of the line RAID product, the interim CEO Boucher hinted at that in the September analyst conference call, claiming that the company would very soon make an important announcement with RAID. Words are cheap and obviously even the cheap words did not impress the market. But we will see about his money and his mouth and judge for ourselves.
Until the company can actually SHOW it has turned around, if it does (and I still believe it will), even at this extremely depressed price it is unlikely to attract new investors. Especially as it continues to slide. But the volume is very, very low. Not long ago the average daily volume was in the neighborhood of 2 million shares. On Friday it lost a chunk of percentage points at less than a million shares.
A new product announcement is not likely to make a dent in the share price at this point, unless the product represents the new technology you mention. The company has to come along with a near-revolutionary product/technology to start the stock on an upward trend. An announcement of a marginal improvement in one of the standard adaptors won't cut it with investors. Beyond some revolutionary product, Adaptec at the very least has to demonstrate it can regain its former levels of growth. It is very difficult for me to see how that can come about in less than six months. The extreme changes instituted by Boucher, Adler and the board over the last two months are difficult for me to gauge in terms of the cost savings and future margins. So, who can say when, how, or if there will be a turnaround. Also difficult to gauge are the future benefits Adaptec will/may accrue from its equity holdings in Chaparral Technologies, Jaycor (JNI) and BroadLogic. Many uncertainties, and uncertainties aren't worth anything in the market, where money talks; BS walks.
Starowl |
