Keep in mind four things:
1. TT backout reduces revenue, true, but it also reduced the NUMBER of SHARES in half. So, EPS are not as impacted as one would think.
2. The core business of SETO, outside of TT, has expanded.
3. SETO has made NEW acquisitions that are highly accretive. The battery company for example.
And if these three aren't sufficient, remember that the price of the stock has already pulled back over 60% as a result of the TT interest cost problem.
In my opinion, no matter how highly TT was valued, this level of hammering is a bit overdone.
Certainly, this stock ain't gonna pop immediately. The 3rd quarter, if negative TT impacts cover even but one month, will see a decline in quarterly EPS. But forward looking, the other events surrounding SETO should more than compensate.
If the street wants to bring this stock back down to the low 20s again, I will stick to it like a cheap suit, white on rice, flies to manure, whatever...and so will quite a few others.
SETO is one of the five pillars in my retirement account. The other four? MSFT, CSCO, DELL, and YHOO.
Bottom line Chalu...SETO is still a BB. But unlike 95% of the rest of the BB sector, it reports and has demonstrated its ability to generate earnings, notwithstanding this recent burp with TT's financing problems.
TG
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