GRU enjoyed another big up day with record volume. I am long and have faith in GRU, for the following reasons:
1, Fundamentals: when I look at its past, I will not dare to put money in it. That is the reason why it did not fly at early stage after its IPO. However, investing is not about past, is about future. As CEO admitted that they made mistake to focus on a few customers with paied service in the past, now Answers.com is following succesful YHOO, GOOG, ASKJ, model - free and earning via ads.... In very short period of time after Answers.com lunched in Jan., this looks working very well as supported by several very very important developments: its daily reach increased from <100/million to 1600/million as 1-30-05, both GOOG and AMZN use GRU as part of their service (that is big, man. The fact that these net-kings select GRU already say a lot about its value), their tech is so impressive by mainstream media and importantly patented (a reason why GOOG used it instead of creating by itself),.... When I think about its future, I have very strong faith in GRU to become a very powerful net player and greatly rewarded stock;
2, Valuation. Yes, it did not make money, yes, it lost tons of money. That all in the past without ads rev. As indiacted by YHOO, ASKJ, INSP, earning, internet ads is growing rapidly, with Answers.com is getting more and more popular and more and more hits, its rev will increase with any doubts. As I always said, in forseen future, ASKJ should serve as the bench mark for GRU. ASKJ is but a colon of YHOO and GOOG, it has good earning with 1.6billion market cap. GRU has its patented and very great 1-Click ANswers. Giving GRU some time, it can pass ASKJ. However, GRU is now just 70million market cap, >20x less than ASKJ. I fell very lucky that I, just like those guys who got some IPO shares, bought very good amount of GRU @ <10 price and added more when I saw its big potential.
3, Expectation. Since it had bad performance, a lot of people in Wall Street and Main Street Still have doubt about GRU. That is a very good sign, and means that there are much side money available to get in as far as GRU does well.
4, Momentum. Chart indicates that GRU has enjoyed great momentum even without big PRs from the company. Based on my 15 years' stock investing experience, such big move over past two weeks are very solid. The volume are always every big when it is up and low when down. I suspect that there are big funds behind those moves. Given the fact that its market cap is only 70million and its float only 3.5 million, any good news such as a deal with GOOG, or others, huge daily reach, .... with keep its momentum going.
Everyone has their investing style and strategy. I do weekly trading also; such as bought in SIRI @1.8, 3, 5 and sold @9.15 AH and bought in AEXCA@7, 15, 20 and sold@41, 51, bought in ANTP@6,15,25 and sold it @35, 45. But, for GRU, it is too early for me to think about selling, since GRU still has very very big room to grow - 200million, 1 billion all in forseen future-of course not in one week or one month - I have that patient.
My advice is that: not to time GRU or to sell now to buy when it dips. Sometimes, you will lose very golden opportunity to hold one very rewarding stock (nor too many), since you always fear its price too high and still want to wait for its dip. If I tell you, it will reach 200$ per share, do you care 1 or 2 dollars up and down and extry price?
SYill long and enjoy GRU and answers tool.
Tomorrow, GRU might be up and might be down. Who cares?