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Earnings reports

The Un-Sweet 16

4:15 PM -- It's tough to tell how companies are doing just by looking at a stock screen. But some screens make us wonder: Why is this company so unpopular, even relative to all the carnage on Wall Street this week?

Here's a sampling of the technology sector, with 16 not-so-sweet names I picked out for having two characteristics. First, their book value per share is higher than their current share price. Second, their market capitalization is lower than their current cash and investments.

And, while the S&P 500 is down around 40 percent so far this year, all but one of these companies has suffered a 60-plus percent share price drop.

Hold your nose, here are the Un-Sweet 16:

Table 1: Troubled Companies?
Stock Ticker Company Name Book Value per Share ($) Curr. Price Market Capitalization (mil.) Cash & Cash Equivalents ($ mil.) Price Chg. - YTD (%)
ADCT ADC TELECOMMUNICATIONS INC. 9 4.66 549 656 -70.03
AIRN AIRSPAN NETWORKS INC. 1 0.18 11 26 -89.77
CALL CALLWAVE INC. 2 1.08 23 30 -65.16
CIEN CIENA CORP. 11 7.75 700 873 -77.28
FTWR FIBERTOWER CORP. 2 0.41 62 172 -82.02
WAVE NEXTWAVE WIRELESS INC. 1 0.25 26 41 -95.35
NT NORTEL NETWORKS LTD. 5 1.19 591 3,071 -92.11
OPWV OPENWAVE SYSTEMS INC 2 0.75 62 196 -71.15
PRXM PROXIM WIRELESS CORP. 0 0.19 4 5 -80.81
RDCM RADCOM LTD. 2 0.91 4 5 -68.84
SOAP SOAPSTONE NETWORKS INC. 7 2.71 40 101 -65.83
UTSI UTSTARCOM INC. 5 1.98 249 254 -28
VRAZ VERAZ NETWORKS INC. 1 0.73 31 31 -84.85
VOCL VOCALTEC COMMUNICATIONS LTD. 1 0.24 2 4 -70.73
WSTL WESTELL TECHNOLOGIES INC. 1 0.44 25 60 -69.44
ZHNE ZHONE TECHNOLOGIES INC. 0 0.15 23 44 -87.18


— Phil Harvey, Editor, Light Reading

gbmorrison 12/5/2012 | 3:28:51 PM
re: The Un-Sweet 16 There's actually several things that could be at work here, to different degrees for each one because a few are 1st tier types, a few more like fourth tiers. But there could be many more shares (and warrants for shares) held by insiders, management and institutional investors that are not part of the 'float.' The market I'm sure is pricing in future expectations that revenue and/or the end-market is in decline. OR the market just does not trust the current numbers all that much -- some of these companies have shown lots of revisions and adjustments.
Mark Sebastyn 12/5/2012 | 3:28:40 PM
re: The Un-Sweet 16 1. Book value is meaningless in this sector because of Goodwill, which is basically what a company overpaid when they bough the last 9 companies (see Nortel).

2. MarketCap/Cash is also meaningless unless you look at debt (see Fibertower), and more importantly, debt maturity horizons.

3. Metrics are meaningless when institutional investors have to sell to meet redemptions/margins ratios.
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