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Strategies & Market Trends : Dave Gore's Trades That Make Sense -- Ignore unavailable to you. Want to Upgrade?

To: id who wrote (5929)	4/19/2002 12:51:13 PM
From: Dave Gore	Read Replies (2) \| Respond to of 16631

id/All: Some are asking: "Why isn't HQNT moving up"? Here's my take and why it may be happening and why the patient should be nicely rewarded. HQNT has had record volume (buy volume and overall) this month, I am told, so the float is slowly drying up as few are selling. With the addition of Larry Burden, former Senior VP of Freddie Mac, and distinguished scientist, Dr. Laipply, who himself has accumulated over 1M shares of HQNT in the open market, things looks promising. (see recent PR's) The only reasons I can think of for its tame performance today is the following: (1) Not sure there are many shares to be had. The true float now is reportedly very low and there are some major investor positions (i.e. Dr. Laipply over 1M and others). The MM's are probably short and trying to get shares from somewhere. They've called the Company before for shares. They may want to see if they can withstand raising the bid and ask for now. With so little selling, not sure this will work much longer. (2) Some are waiting for it to close above its 52 week high of 74 cents. It's been basing and not dipping more than a few cents. BTW-- Basing is actually a good thing and telling everyone that the base is getting more and more solid. (3) The MM's are not filling orders or delaying the fill to try and make it look like there is little interest. I've seen this trick before many times. Many shareholders from this thread have reported slow fills on HQNT over the last 2-3 weeks. (4) Others may want to see the audited financials when they come out in the next week or so. However, they rarely change much from the unaudited data, in my experience. So we'll see. I believe the patient will be rewarded. A company just doesn't stay below a buck or two for that long, imho, if they are profitable and have a relatively low market cap. I hope most will give this company a chance to reach the $4-5 level or higher in a year or two, which it easily could, if it earns 20-25 cents a share or more next year. Everybody likes to be on the winning side of a hot momo, but slower and more solid success is not a bad thing, either, whether we are talking about SMID (PE of 3.3) or HQNT.

To: id who wrote (5929)	4/20/2002 3:04:47 PM
From: augieboo	Read Replies (1) \| Respond to of 16631

HQNT--given the action in other pennies over the past few days, especially the pennies with news, i am perplexed by the markets yawn at HQNT's announcement of profitability. I was curious about this too, so I poked around in their SEC filings a little bit. There is no 10K (annual report) available because this co seems to find it nearly impossible to file anything on time, so I had to work with last quarter's 10Q. Anyhow, maybe the stock isn't rocketing to the moon because: 1. The majority of their net revenues seems to come from gains on investments they hold in other companies... Operating income 376,918 Gain on securities 440,079 Interest expense (21,853) ==================================== Net 795,144 2. Their operations are still hugely cash-flow-negative: Net cash used in operating activities $(1,092,768) 3. The IRS has a tax lien against them, in the amount of $386,235, for unpaid payroll taxes of a wholly owned subsidiary. 4. From April through June 2001, they issued 2,183,700 shares of common stock -- restricted under Rule 144 of the Securities Act of 1933, but issued nonetheless. Hey, don't get me wrong, this may be a great investment over five or ten years, but, IMHO, from a trading point of view it looks to me like just another penny stock POS. If a few people wake up one morning and decide to buy it, the price pops through the roof. If a few people decide to sell, it'll drop through the floor. Just be sure you're not late to unload. All of the above is just my opinion, of course. augieboo Disclaimer: I do not trade, either long or short, in this or any other OTC-BB POS.