Planet Correction- Today’s Edition Inaccurate
February 15, 2007 @ 7:41 am
In today’s edition, I inadvertently published some incorrect information. I mistakenly read the press release to believe the company had issued 3 million new shares to institutional investors, when in fact the fund managers bought those shares from existing shareholders.
As I observed, the company didn’t actually need the money. Therefore, the sale of those shares is actually better as their is no dillution. Net result is the same- the institutions have their position.
As the company grows, the cost basis for early shareholders will continue to go up. That is a logical progression.
While the facts were wrong, the interpretation was essentially unchanged. These events are a mild negative for the stock short term, positive longer term.
Comments and questions are welcome.
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I am wondering why there was about a 20% increase in price when there was no news.
Also, which bulletin boards talk about this stock ?
Editor: There is a 20% increase because there is more buying than selling. I don’t know who is buying, but someone clearly has a big appetite for this company. I believe it is going over $4. I don’t know who talks about it. I generally don’t read message boards.
Comment by Stan — 2/20/2007 @ 1:50 pm
Not quiet sure how you conclude the recent news as a negative, quiet the contrary. These shares aren’t even registered. This is a great event and it took on of the lquidity sources off the market. all in all very good news. stock is going higher…
Editor: Yes, and the stock sold off. I don’t understand why people don’t understand it’s a good thing when founders shares at a zero cost basis jump to a cost basis of $1.90. Now, the institutions care. If the company does well, the stock will trade much better.
Comment by to the moon — 2/15/2007 @ 4:19 pm
I agree it was a great step for this company. Institutional investment is worth a lot to this company, and I am glad they are looking toward the future and not just trying to look shorth term. I was getting ready to pull all of my shares out, but this company’s approach has made me think twice.
Editor: You have to have institutional participation to get this stock to these new levels. It will have a whole new audience. If the company does well, the stock will trade much better. If the company disappoints, it will get killed. I suspect the company will do very well in Q4 ‘06 and Q1 ‘07- look for $4 to $5 in my opinion. And- look for the company to make the jump to the NASDAQ.
Comment by Sean — 2/15/2007 @ 2:27 pm
CPNE was one of your top picks in 2006.
With all the recent activity in terms of PPS moving swiftly from $2-$3 and two recent press releases and the fact that they have scheduled their quarterly report in front of the media on the 22nd of this month ….and yesterday with institutional investors buying into the company…hmm
This picture looks alot different that just a few months ago.
What’s you feeling for CPNE in 2007?
Thanks,
Scott
With institutional investors buying into the company the dynamics change alot.
Editor: I have heard estimates from fund managers who use valuation metrics that this stock could be $10. However, personally I am in the camp that $4 to $5 is a reasonable target- perhaps earlier than later this year. AT $4 to $5 I would offload our whole position, even though the stock might still go to $10. I believe we will see that because I have a high level of confidence in Q4 ‘06 and Q1 ‘07. I’m not sure where we go beyond there.
Comment by Scott — 2/15/2007 @ 11:15 am