< Why are you in this stock? I've read your previous posts---you don't like the management, you think they cannot stand alone, and you're uncertain that there will be buyout. Could it be that your short this stock. <
1)I'm not short the stock, acquisition candidates are poor short plays, IMO. I hold a modest number of shares and quite a boatload of May17.5C's, so I really do hope they get acquired and/or the price keeps going up for some other reason. I've also got a partial straddle with some May17.5P's, because I am afraid that the management of FORE is not firmly grounded in reality, regarding its long term ability to prosper among the tall trees. My logic is that if they are acquired it will more than compensate for the loss on the puts. If they are not acquired in the next month or so the price will start to drop and I'll recover some of my long position.
2)The management's business acumen has yet to be really demonstrated. FORE was the pioneer and clear leader in ATM, yet, they managed to never really exploit that position. Dubious acquisitions, poor costs controls, fantasy revenue projections...
3)Why am I in this stock? Well, its not because I have some sort of FORE religion, that's for sure(you sound like you do). Its basically because I think there is some money to be made. Back in October I started to increase my XYLN position dramatically because I was very convinced they would be acquired. At the same time, because I believed there would be an accelerating consolidation in the industry I made a few other bets, in case my XYLN hopes were not fulfilled. I figured that if it wasn't XYLN then for sure FORE or maybe, even NN would be acquired.
This chart says it all, as far as I'm concerned, when it comes to FORE management. If not for the recent 50% rise on acquisition speculation the 50 month return on FORE stock would be -35%. That's a hell of a job!!! As I said before, some decent products, good technology, reasonable technological vision...truly crappy execution.
techstocks.com |
