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Microcap & Penny Stocks : DCI Telecommunications - DCTC Today
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To: Parker Benchley who wrote (9127)10/8/1998 9:47:00 PM
From: Jumpin Joe  Read Replies (1) of 19331
 
George,

When a stock takes a dive like DCTC has recently, I think we all begin to wonder about "what bit of information am I missing that everyone else knows about". It's normal human nature. However, I think DCTC has responded publicly to its stock price and has made positive public statements as to its future success. In the Sept. 4 press release DCTC management stated that "they know of no fundamental reason why the stock price has been under pressure other than overall market conditions". Later on Sept. 23 they followed up with a statement which included the following:

- 2nd Q sales 60-70% higher than 1st Q.
- Gross margins up to 16.5% from 14.6%.
- Announced the new $48 million contract for Edge.
- Hinted at buying back shares via a ESOP program.

IMHO, those two press releases clearly define management's opinion of the companies current state of affairs. It is also important to remember that DCTC management holds many more shares than most of us. One has to trust that they want the company to succeed as much or more than we do.

When the stock world seems upside down, I always try to step back and put things into perspective. One example is as follows. DCTC's current market cap is about $14-15 million. It was only a year ago that they sold a small contract to SMTK for about $9 million. One has to ask the question, with all of the new contracts, acquisitions/JVs, increased revenues, improved margins etc... is DCTC worth more than $15 million dollars? Is the stock price out of sync with the fundamental value? How one answers those questions determines whether one stays in or bails out. My gut feeling about the odd nature of the way the stock has been acting negatively to a lot of positive news tells me that "something smells a little fishy here" but I don't believe it is the company that "stinks".

Good luck to all,

JJ
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