Sent, correct. PPS moves due to shareholder interest and not necessarily due to the current bottom line results.
You can say all you want about the tech bubble, but much of that movement was coming in anticipation of future earnings...in fact the entire dot com phenomenon was due to the forecasting of future earnings for all things internet related. The PROBLEM was that future earnings did not materialize, as many dot coms had no business plan. And those that did met with an economic downturn not seen in decades.
While earnings to the bottom line need to follow to sustain the move up, evidence of a growing line of products in multiple markets is what the market is looking for, IMO...real deals, real products and the confidence that it will continue to grow.
Should EDIG nail down the ECLIPSE opportunity this March when ECLIPSE enters The Good Guys, and there is evidence of success there, followed by talks of incorporation into production line autos down the road, the market will likely trade in anticipation of that opportunity.
The same holds for the WIRELESS PLATFORM and the possibility that it will be part of an entire generation of devices via brand labeling. AND should the IFE product reach its audience simultaneously, EDIG looks like an entirely different company, IMO.
In other words, it's FUTURE EARNINGS, followed by a reasonable expectation that these earnings will materialize, that will drive a stock's price. Of course there must be evidence that this is occurring.
At today's PPS, few would consider this a pricey range for a company making waves in so many industries. Most of the investors who helped drive this stock to $24.50 were very excited about the prospects at that moment in time. In the ensuing years, with the realities of the world markets, some have left, some have turned to try their hands at day trading while others have held and added... but the fact is that interest has waned while we live through these tough economic times. In the mean time, EDIG has not sat on its hands, but has learned some harsh lessons and has adapted its technology into new and old markets.
It will be NEWS of real deals and evidence of these deals reaching fruition that will once again add value to this company and create the perception of the stock being undervalued vs overvalued.
TODAY we are faced with weak financials sitting on a powder keg of potential. And, all of these budding markets, IFE, auto infotainment, MP3 jukebox, and wireless platforms appear to be evolving simultaneously.
The current weak financials will become meaningless should one or several of these ventures become a market reality. At that time, the market will once again view EDIG in a positive light.
AI
