analysts will start to get tired with the company lowering guidance each and every quarter - why should the company trade at a pe above 30 if earnings growth will be a meager 15% - and I guess the company will have to lower that expectation several times during the year again
Q4 clearly was a good quarter but the outlook is more of the same. There's no reason for the stock to trade above a pe of 15 which would give us a price target of $45
the stock won't go up anytime soon as it finished on the low - there is some heavy hedging activity going on in connection with the giant convert offering which will most likely continue for some more days given the low average daily trading volume of the stock. Moreover investors are scratching their head about one of the most unnecessary capital raises of all time. If you have a longer term horizon this might be the time to get long but if you want quick gains move on. And move fast.
investors are cheering a good quarter but the outlook is abysmal compared to already several times lowered expectations
should face some downgrades tomorrow
what does the lender risk here ? nothing at all - look at OCZ which made a similar loan arrangement with Horizon Technology last year. The company went bankrupt with shareholders losing everything while Horizon got paid back in full plus interest.
Redchip was payed generously for the promition which makes the company looking even more suspicious than before
they could have taken on the debt when finalizing an acquisition but they are actually raising money without any reason. No wonder investors don't understand the move.
actually you have to consider that conventional technology won't stop getting better going forward - so they will have to bring down product costs MUCH more than 30% - which they won't. They stated on the call that they are bringing down their product costs only at a pace of 4-12% annually
what a joke of a company
"InterCloud Systems Inc. (“ICLD”) is a client of RedChip Companies, Inc. ICLD agreed to pay RedChip Companies, Inc., 7,500 shares of common stock under Rule 144, and a monthly cash fee for six (6) months of RedChip investor awareness services. Investor awareness services and programs are designed to help small-cap companies communicate their investment characteristics."
I would love to short the shares but simply there are rarely shares to borrow
I would like to add that this might be a great chance for long term investors to enter the stock at a substantially reduced price tag.
they explicitly stated in the pr that there is no acquisition looming. They just borrowed money at the expense of existing shareholders