The purpose of the class action law suit is to keep management in line by keeping it accountable and truthful. I have no idea if RXSD management mislead us last year when it reported its prediction of earnings for this quarter then revised on Nov 5th. But if it did, we all benefit by the law suit in more important ways then a couple of bucks a share.
Reviewing the insider trading since last year, I do not see any particularly active trading, one way or the other. For this reason, I don't believe that the class can get past a well prepared motion by the management for summary judgment to dismiss. That will probably be in a couple of months.
If you noticed, the price of stock actually rose on the day of the news of the lawsuit, so I don't think there was panic by any major holder, as we saw on Nov 5, hords of sales driving the stock price down 40%.
I'm accumulating as many shares as I can at this price. Even with the revised estimates for the quarter, there will be a spectacular increase in business over last year, enough to support a new high during 1999.
As to the present theory that there is some sort of support at 15, I suggest that you review today's range...there were buyers at almost 16 supporting my view that there are many more like me, just trying to move enough money to get in before the rest of the market does. Sometimes it takes a few days to do so. As we do, there will be a constant buying presure returing the price to 20's before the end of the month.
Look at WFMI as an example.
Joe. |
