Is Zanett's (ZANE) 600%+ Move Today Justified?
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Shares of Zanett (Nasdaq: ZANE) are going ballistic today after the company announced record bookings of $12 million for January and February. At last check, shares were up a whopping 650%!
So how big is this news?
Well it appears the results are strong, but may not be strong enough to justify a 650% move.
You see in the fourth quarter, a three month period, the company reported signed contracts of $13.7 million. If you take the current rate of bookings for the first two months of Q1 and extrapolate out the same pace of bookings for March, you will get to a figure of $18 million for the quarter. That represents sequential bookings growth of $4.3 million, or 31%.
Good, or even great perhaps - but not maybe not 600%+ good.
Also, earlier in the week Zanett received a Nasdaq delisting determination letter due to Zanett's failure to regain compliance with the Nasdaq Capital Market's minimum bid price. If the stock maintains its level above $1 this may alleviate this concern, but nonetheless it reminds investors that this stock was just 30 cents yesterday.
Another concern for Zanett is that it appears low on cash. At September 30, 2009 the company had just $87.6K in cash, down from $450.3K at December 31, 2008. Receivables are $6,568,531.
For the three months ended September 30, 2009 Zanett had revenues of $9,903,120, down significantly from $12,622,529 in the same quarter in 2008. For the Nine Months Ended September 30, 2009 revenues were $31,795,705, versus $36,860,354 for the Nine Months Ended September 30, 2008.
For the three months ended September 30, 2009 Zanett reported a loss of $0.09 per share, down from a profit of $0.02 in the same quarter in 2008. For the Nine Months Ended September 30, 2009, EPS was $0.09, down from $0.19 for the Nine Months Ended September 30, 2008.
Cash flow for the nine Months Ended September 30, 2009 was a negative $734,945.
So while today has been a fun run-up in the shares, traders may want to take a look under the hood. What they find may not be all that pretty.
So how big is this news?
Well it appears the results are strong, but may not be strong enough to justify a 650% move.
You see in the fourth quarter, a three month period, the company reported signed contracts of $13.7 million. If you take the current rate of bookings for the first two months of Q1 and extrapolate out the same pace of bookings for March, you will get to a figure of $18 million for the quarter. That represents sequential bookings growth of $4.3 million, or 31%.
Good, or even great perhaps - but not maybe not 600%+ good.
Also, earlier in the week Zanett received a Nasdaq delisting determination letter due to Zanett's failure to regain compliance with the Nasdaq Capital Market's minimum bid price. If the stock maintains its level above $1 this may alleviate this concern, but nonetheless it reminds investors that this stock was just 30 cents yesterday.
Another concern for Zanett is that it appears low on cash. At September 30, 2009 the company had just $87.6K in cash, down from $450.3K at December 31, 2008. Receivables are $6,568,531.
For the three months ended September 30, 2009 Zanett had revenues of $9,903,120, down significantly from $12,622,529 in the same quarter in 2008. For the Nine Months Ended September 30, 2009 revenues were $31,795,705, versus $36,860,354 for the Nine Months Ended September 30, 2008.
For the three months ended September 30, 2009 Zanett reported a loss of $0.09 per share, down from a profit of $0.02 in the same quarter in 2008. For the Nine Months Ended September 30, 2009, EPS was $0.09, down from $0.19 for the Nine Months Ended September 30, 2008.
Cash flow for the nine Months Ended September 30, 2009 was a negative $734,945.
So while today has been a fun run-up in the shares, traders may want to take a look under the hood. What they find may not be all that pretty.
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