GEPT was out with news this morning of a negative nature. The company announced it has been unable to come to terms with acquisition target Astrophysics. According to the release, the parties have “ reached an impasse ” in their negotiations.
In my view, the Astrophysics acquisition would have been one of the key drivers in the the future growth of GEPT. I believe this is a major negative event for the company, and will likely lead to erosion in the price of the stock.
This takes GEPT completely out of the rapidly growing baggage and cargo screening market.
If you still own this stock from my June and July editions in the $3 range, and y0u didn’t follow my suggestion of selling some or all of your stock in the $7 range, act before it is too late.
If memory serves, in previous writings I suggested waiting until the stock traded into the $4.50 before buying. I now feel the stock could easily come back and fill the gap created when the company received notoriety from Jim Cramer on his Mad Money show on CNBC.
Those who own this stock from the June and July time frame should send Cramer a thank you note. If you are still holding, you have been warned. Once the big MO players start selling this stock, it will drop as quickly as it rose.
Of course, I could be wrong. It might hang in there. However, the market is overdue for a correction, and so is GEPT.
I still like the company longer term, and will come back with some ideas on a good entry level pending how it trades.
As always, you comment and questions are welcome.
BOUGHT GEPT 4.58 1/05 JUST SAW YOUR BLOG OF 8/4 SHOULD I SELL AT 5.30 ?
Editor: $7 was the ideal sell point. Now, in the $5.50 range- not as much downside- I’m looking to be a buyer at $4 to $4.50. I am short 1,00 shares at $6.45 just for a trade. The loss of the Astrophysics deal was a big negative in my mind. Could go either way, but perhaps I can answer by saying I certainly wouldn’t buy it here.
SECURITY OF OUR COUNTRY AND THE WORLD. WHY WOULDN’T THIS STOCK GO HIGHER. NICE CONTRACTS OUT AND A CONTINUED INCREASE IN THE COMPANY! IIDEAS ASO TO WHEN THE Q2 WIL BE RELEASED. THANK YOU
Editor: Q2 numbers are out now. I love the $18 million back log. I believe the market still wants to go a little lower on this one. The move was too much too soon and for all the wrong reasons. There will be a time to get back in.
I am out of GEPT around $7 and very happy about that, but may go back in. I notice a large short interest. Your thoughts, other than be patient for $4.50?
Editor: I love the $18 million backlog. Numbers about what was expected. I don’t believe the disappointment on the Astrophysics deal is fully priced into the stock yet. When for the stock to trade sideways on light volume before re entering. I still like the $4.50 level. I’ll be keeping an eye on the chart.
What do you think about this stock with the proposed federal requirement for camera surveillance in the airplanes?
Editor: Moderately bullish for GEPT- however, I read it will take two years for the FAA to even decide if they are going to mandate the video surveillance cameras. I still think $4.50 is a good entry level, and I am having a hard time getting past the failed acquisition of Astrophysics. That was the holy grail for this company.