For some of us, this may prove to be one of the longer Memorial Day weekends in recent memory. FWIW, here are some assorted thoughts that might help keep those shoulder muscles from tightening up--worrying about WAVX--while flipping burgers and tossing down Buds (the tossing down beers should, of course, eventually kick in and also help relax the upper back and shoulder region as well).
I would suspect that the major concern right now is whether the go2net and Hauppauge announcements are it for now. If so, the stock will likely retreat next week, perhaps considerably. I believe it was Klingerg who posted some revenue figures for these companies, and they just do not justify sustained WAVX trading in the mid-$4.00 range. (It didn't help to see the several typos in the Great Stuff Network blurb on MetaCrawler, or whatever it's called, but whatever.)
Is there more coming? Especially along the lines of OEM/PC-maker deals? I think there has to be, for reasons mentioned previously: WAVX has really played up E3 in its invitations to shareholders by email this past week, by its website "exhibiting in force" comment, and in the recent earnings report where they mention that "content providers, potential customers, media, and the financial community" will have a chance to see what WAVX is all about, and see how to derive additional revenues for themselves as well.
WAVX is simply crazy to pitch E3 this way if all they're going to say is, "We're talking with several OEMs, and we're hopeful we'll soon have a deal that will lead to mass deployment of WaveMeters in the near future." Given the foreshadowing of the event, THAT JUST IS NOT GOING TO BE A GOOD ENOUGH PAYOFF (IMHO). WAVX knows that; its IR and PR people know that. They've been saying that much for years now, and this time they simply will need to have OEM deals in place, ready to roll. Therefore, it stands to reason, the probabilities are very much in favor of those agreements being in place as we speak.
Okay. Maybe they will play up this internet marketing exclusive deal with go2net and the WinTV deal with Hauppauge Digital. The market apparently liked that news the last several days. (My theory, BTW, is that the market this week reflected not only those two announcements, but also the sentiment of a number of investors who already have knowledge of various components of next week's news, not just the news that is already out. Indeed, without that segment of the market, I would have expected WAVX to sell off soon after Wednesday's news. Something else is providing technical support in the $4.00 range.)
Back to the train of thought: If anyone still thinks all WAVX's self-generated hoopla about E3 is solely to pitch the go2net and Hauppauge deals, then consider that as of May 22 neither one of those two companies is even registered to be at E3! I think those stories were released this week as a favor to those companies, so they would not be buried and forgotten in the context of WAVX's real news.
24601 and Andrew Peterson had questions about the number of shares of common and the role of the Reg D converters. Wahoograd has also commented on this issue, apparently having heard from the IR folks that Combination, Inc. has no interest in sticking around. I don't know the answer. However, I question whether the increase in outstanding common for Q1 year-over-year to 27,359,000 would include Combination, Inc. (the March, 1998 Reg D investor). The Q1 1998 figure is a weighted average through March 31, 1998. The process for registering Combination Inc.'s shares did not even begin until mid- April and, I am told by investment bankers, generally takes 30 days to get through the SEC. Also, the recent S-1 will likely only result in conversion of 4.5M shares, 2.7M of which would belong to Combination, Inc. (given the recent price activity in the stock). So the sequential quarter increase from about 20M to 27M also does not correspond with the most recent 4.5M shares, which assumes those shares are even registered and converted.
As an aside, under the Stock Purchase Agreement, Combination, Inc. cannot convert to common if it will result in having greater than a 4.9% interest in the outstanding common. This dampens the rate of conversions somewhat, I would imagine. 4.9% of 27M is about 1.32M. Ironically, this contract term tends to encourage the converting shareholder to sell the shares quickly so as to stay under the 4.9% ownership ceiling if his agenda is to convert, sell, and move on.
After reading that post, everyone should now be sound asleep, ready for the weekend, even my fellow Californians. (Now there's also a new remedy for sleep disorders, right, DocStone?)
Pure Folder
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