Muenchen, you state some truths
1. Mngt won’t buy shares. I, very seriously, believe that they neither know how nor understand what it means. Listening to their rebuttals during CCs about options dumps clearly indicates a fundamental gap in their knowledge and/or experience. It’s breathtaking. Cats don’t swim, they don’t get swimming, and nothing can or will change that.
2. MSFT won’t bluelight Wave, ever. The world according to MSFT consists of 3 things: MSFT, the hardware MSFT runs on, and “third party developers”. Third party developers are like pigeons to MSFT, they all look the same and they certainly don’t name them.
Okay, enough of that.
Fears. Folks could fear a number of things …
Let’s take the Dell bundling. One could fear that it is going away, going away soon. The data doesn’t support that. The last reported quarter reflects the highest quarterly revenue from Dell ever, some $5.7m. Does that make it impossible? No, but unlikely in the very near term in a manner that could explain near term SP weakness. Another important point about Dell revs, while they swelled in Q3 to their highest level ever, they represent the smallest percentage of Wave revs since inception of the relationship. So while the Dell gross is bigger, the dependency is shrinking.
What could inform other rational fears? DoD? Pipeline? The lawsuit?
On DoD, the Army Sole contract, Safend’s old deal with the Navy, and the scope of the NIST and DoD memorandum indicate to any observer that although the rate and nearer term scale of anything is unknown inroads exist, the big pitcure appears entirely on track, but nothing about rate or size has changed. Unknown going to unknown is not change. FWIW, I would remind folks that the Army’s Sole JA indicated the devices were scheduled to start rolling Feb/Mar. Its Feb/Mar. The engineering team is presumably currently deployed doing their FBCB2 pre-deployment stuff as requested in the award. This is, for all intents and purposes unknown. No PR, no 8k.
On the pipeline, the pipeline is the least illuminated, most without a carrot that it has been for some time. That has been the case since BP (a carrot previously known as BEWML) closed. Perhaps investors have no stomach for Wave for more than a couple of months without a fat carrot. I don’t know. The linkdin sleuthing indicates 18k seats of an 80k seat effort has deployed with the balance to deploy over the standard refresh cycle. That’s the equivalent of 3+ additional BPs in the pipeline. It’s not guaranteed, who knows when, but if GM is anything to go on, once BP has settled in they will be as likely to accelerate IMO. SMB showed real growth Q3, in a couple of weeks some light will be shed on Q4.
On the lawsuit, anything that happens there gets an 8k in 4 days, simple as that.
Everything today is largely as it was yesterday except for an announced AMI relationship, clear demonstration of an active Trusted Logic relationship, and evidence for work with Samsung consistent with the announced relationship.
Finally, while the Dow has been o.k., the Russel 2000 has been having a less than wonderful time, certainly a bad day this Friday. I don’t know about margin thresholds, $2 isn’t a hill of beans at my broker, but that varies.
It’s going to be rocky heading through the 10k, but on balance, it looks pretty good for 2012.
The above content is my opinion.
