well well well .. seems as if Mr Hernandez has changed his tune.. OK, I find this debate and this stock extremely interesting. There is no room for false bravado here. It is not for the faint of heart and there is nothing wrong with selling at any time .. whether it be cutting your losses, taking profits, whatever your reasons may be.
I respect everybody on this board and wish you the very best in luck in deciding what to do. My opinions are well-known and I am not going to repeat them. I think it really is a unique situation and an unknown. I can only play the odds.
His point of view is diametrically opposite to what I have posted and where I have been supported by some very knowledgeable people with experience in the software business. In fact, it is almost a reply, and he even uses some phrases from recent postings here. How interesting... he even mentions the recent stock purchasing activity.
These are some undeniable truths/untruths that I think must weight heavily in this "bet". In order to help out those considering this:
- he blames institutional "culprits" for "bailing" in the middle of their "acceleration" as a software vendor. uWink has not left the starting gate yet in terms of being a software vendor. When I see the changes necessary, I will change my observation. Right now, they are not moving in that direction. Now, maybe the Father of Video Gaming can work some Magic. But, that is gambling in my view. There are no guarantees. He may, he may not. He undoubtedly has connections and commands respect. Blaming share dumpers is the oldest form of whining there is. Institutional holders dump for a reason. After all, it is Other People's Money. This time of year and until the year-end, alot of the time it is tax loss selling. Well, you can't blame them. It is their right to so that.
- to change his mind this quickly does not convey a very good message. Serious people do not change their mind too often. They realize the meaning of the phrase: "the trend is your friend". Too much trading is a bad thing. A mere few weeks ago he was saying that you could lose all your money with this stock. What is this? When someone slams the financials like he did, how can he change his position so suddenly when there is no new information that will cause the financials to change? Get real, Chris. Meanwhile, I feel that it will go down one final time, which is a better reentry point.. a far more credible position. All I am saying is let matters come to a head, which they will at the latest with their next qtrly report.
- he again asserts that uWink has 3.2M in the bank. This cannot be possible. His statement is applicable "As at" the end of the last qtr. Sub 600k for MV. Allow for some ST debt, which I believe left Working Capital of 2.2M in the last financials (a more meaningful number). Subtract 1M for further cash burn this qtr. MV will not contribute revenue. HH will and slow the burn, but they will still burn 1M. What can possibly be left? btw, we are halfway through the next next qtr now... Chris?
- he states that "breaking even on the restaurants was all they intended to do". I actually agree! I, in fact, figured out that on my own. Unfortunately, they are now not going to be able to stabilize financially with the 3 restaurants without cost cuts. I believe it to be impossible. They can't leave themselves with .5M in the bank or something. This is just poor execution, nothing else. They did not plan it out properly. I would think that with 3 restaurants successful, they could get debt financing... but they would have to downsize first.
- he makes a further note about the retirement home deal and is portraying it as their first "licensing deal". It is a joint development deal with a customer as a venture partner that will benefit both parties and from which uWink will not make money. I was involved in something like this with Nortel in 1995 (50/50 joint funding). It is a way to develop software with a business' help where both parties win. It is a way of turning vaporware into real software and for the retirement home to get automation cheaply. uWink will in fact lose money on it. Chris shows that he does not know the software business in saying that.
So in considering this; ask yourself a question. What is going to change that will stop uWink from losing money that I can say with certainty? Answer: nothing. After they get MV open, they will break even if they cut cost. Then they must transform to a software vendor.. that will take time and money they don't have, and will accelerate the current trend. The trend is due to their financial condition. Seen it many times.
I think pessimistically in a downward market and optimistically in an upward one. 2006-207 was up, now we are down. Being pessimistic is good in this market. All I am saying is let it fall further.. before you buy. Yes I am a pessimist.. the times call for it, caution and pessimism.
Anyway, having said this.. I wish everybody the best of luck. We all have guts for even considering this stock and chasing our dreams. Good luck everyone.
