SCO Stock In Danger of Delisting, Again 188
hweimer writes "In 2005, SCO got into delisting trouble because they failed to file their annual 10-K report in a timely manner. SCO seems to be headed the same way again for a different reason: the stock price is too low to meet Nasdaq's requirements. Quoting: '[W]hat can a company do to boost its share price? Besides stopping to burn money and come up with a working business model, I mean.'"
boosting share price (Score:5, Interesting)
Re:boosting share price (Score:5, Funny)
warning: The above content may test positive for sarcasm and/or could be a failed attempt at humor and as such should be taken with a pound of salt.
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So he has a blog, and tries to make some money with it. Then he writes something he think is worth sharing and, not only that, slashdot editors agree it is worth sharing.
Then you add the fact that many of us use Firefox and NoScript and/or Adblock.
What is exactly your problem again ? Do you, per chance, have a blog and no one visits ?
I just visited the link, and saw absolutely no ads of any kind.
Re:boosting share price (Score:5, Informative)
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Because Google pays you only for ads that are clicked as a ratio of those that are displayed, people driving a fuckload of clickless traffic to their sites are just making their possibility of revenue plummet. He'd be better off touting his post to a non-nerd c
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I never claimed the article was unworthy.
And, though offtopic, I know exactly why noone visits my blog - it gets an entry a good two to three times a year.
It's all clear to me now ... (Score:2, Funny)
* Wait for it to go badly
* Post to your blog about them needing a new business model
* Post to
* Profit!
Maybe Señor Blogger needs a new business model too.
warning: The above content may test positive for sarcasm and/or could be a failed attempt at humor and as such should be taken with a pound of salt.
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NEWSFLASH (Score:4, Funny)
Admittedly... (Score:2)
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LinuxWatch has an article by Steven Vaughn-Nichols about the March 2007 SCO conference
Re:boosting share price (Score:4, Insightful)
Almost all anti-delisting reverse splits I have seen back then ended up as suicides... and even today, they still translate into extended near-death experiences often followed by bankruptcy.
Re:boosting share price (Score:5, Interesting)
I think you're confusing the issue a little bit.
The reason reverse splits rarely work is that they don't solve the underlying problem that's causing the dropping stock price to begin with. They treat the symptoms, not the disease. Which means there's nothing "suicidal" about the reverse split, it's just that they don't really accomplish anything other than keeping the company on the market for a bit longer.
It's kind of like taking an aspirin for the pain being caused by a brain tumor. You'll eventually die anyway, but it's not because of the aspirin, it's because of the brain tumor. Taking aspirin isn't "suicidal" and in fact has no bearing whatsoever on your health, it just doesn't solve the real problem.
Lots of people think about stock prices as if they're somehow disconnected from company performance. That's a real dot-com era way of thinking, but we should all be back to reality by now. A reverse split *can* work, but only if it's combined with measures to make the company profitable again. But certainly, if I were a company shareholder, I would want any company that I thought had a good plan for a real turnaround to do a reverse split to keep themselves on the market until their plan started to bear fruit.
Of course, this *is* SCO we're talking about, so I can't imagine a reverse split would do anything but delay the inevitable.
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Examples of successful reverse splits are few and far between and the dot-com era had very few if any of these.
Successful r
Re:boosting share price (Score:5, Insightful)
SCO is not in the position to buy back their shares but they do have a very simple option, a reverse split. Although it isn't common and often has a negative effect on the market capitalization of a firm because it is a sign of weakness in the market it will have the needed results. It is quite simple to do, legal, and only requires the board of directors to execute. Shareholders don't even have to agree, although most would if it means the difference between being listed or going the way of an OTC stock.
Share repurchase programs usually don't have a significant effect on price by themselves. The number of shares needed to repurchase, and the cash needed to execute a significant repurchase program often doesn't make it feasible to significantly fix the stock price. Share repurchase programs are usually designed to server one of two puposes: to signify that management thinks the company is undervalued, or to consolidate ownership. The second option is only used when a company has piles of cash and it accounts for more than 10-15% of the market cap. Smaller programs tend to be used to accumulate treasury stock while the price is low, then re-sell that stock as the price gets at or above where management thinks it should be in order to raise capital without issuing more debt.
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What, one? Any odd number greater than 1 would be foolish investing at best. :P
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Re:boosting share price (Score:5, Informative)
Aside from rules compliance, and paying the annual listing fee, NASDAQ has three basic rules about staying listed:
- Minimum share price of $1
- at least 750k public shares
- at least $5m market value.
If they fall out of compliance for 30 straight days (and they last traded for $1 on March 13), they get a delinquency notice and have 90 days to get it together. Their ticker symbol will probably change from "SCOX" to "SCOXE" while they're under threat of delisting. [Source [investopedia.com]]SCO already did a 1:4 split back in 2002; I'm not sure how the exchange will feel about them doing it again, because had they not done that split, their share price would currently be less than a quarter.
Two more weeks to go (Score:3, Informative)
As of market closing today, they've traded below $1 for 21 consecutive business days. That means they have almost two full weeks before they could hit that 30-day trigger. The stock has been climbing slowly the last few days and there's at least some
Reverse split for sure (Score:2)
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No one to sue (Score:5, Insightful)
very viable business model (Score:5, Funny)
the SCO business model is simply the application of public relations and litigation to a large scale version of the business model employed by that crackhead cousin of yours that shows up at family functions from time to time looking for cash: getting paid to go away.
the sheer number of crackhead cousins in the united states is evidence that this is a viable business model.
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When your business model depends upon litigation, and you have no one else to sue. What do you expect to happen?
Do like the new Coke Zero commercials and sue yourself. I see them suing Canopy and Caldera. Watch the hilarity ensue.
Easy fix? (Score:3, Insightful)
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Re:Easy fix? (Score:5, Informative)
Re:Easy fix? (Score:5, Funny)
SCOXD
for 20 days.
I know I'd smile every time I saw it.
"Hey hey, guy, buy shares of SCO! XD"
A silly answer and a sensible one (Score:2)
I don't see anything explicitly disallowing it, but rule 4310 says:
------------------
2) Sensible answer:
OK, but what will they do next month?
No Easy fix (Score:2)
It still only buys them a short reprieve. There's another limit they are close to hitting -- $20 million total market capitalization. A reverse split can help the price, but does nothing for Market Cap.
It's really just a matter of time. They might as well acept the delisting and not waste any prescious cash on it.
Re:Easy fix? (Score:5, Funny)
You say that like it's a bad thing...
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Daddy Daddy help me (Score:5, Funny)
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Legal fees (Score:2)
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No longer matters (Score:3, Interesting)
SCO isn't long for this world, anyway (Score:2, Insightful)
You're on the Titanic (Score:5, Insightful)
The answer? You don't. It's useless to try to stop the inevitable.
Re:You're on the Titanic (Score:5, Funny)
Re:You're on the Titanic (Score:5, Funny)
Re:You're on the Titanic (Score:5, Funny)
Re:You're on the Titanic (Score:5, Insightful)
That's not entirely true. If a company has revenue, there's a possibility that they can trim back to ONLY that revenue. If the revenue coming in is more than the cost to support that revenue stream, then the company can continue on. The problem comes in when your revenue is smaller than the cost of maintaining that revenue. Then you're screwed.
If I were an SCO investor right now, I'd be getting together with the other investors to stage a coup. Do like Take Two and fire the board and executive staff. Then install someone who will fire SCO's "crack" team of lawyers (drugs aren't good for you anyway) and start sweeping through the company firing anyone who's not related to the few revenue streams that SCO actually has. Normally that would be a sad (and often dangerous) thing for a company, but in SCO's case, I doubt that many tears will be shed.
Once the company is pared down, then the focus should be on two areas:
1. Improve the customer relations that SCO has been driving into the ground for so long.
2. Look for ways to leverage the remaining company to produce new or enhanced products; thus opening up new sources of revenue.
Normally, I'd say that this is a plan put forward by a wannabe-CEO looking for a Golden Parachute job. As scary as it sounds though, I think it might actually work in SCO's case. *IF* (and this is a big "if") the investors get their tails in gear and flip the company upside down NOW. The longer they wait, the less likely they are to succeed.
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And besides, if Darl and company were ousted, it still might not get them off the hook for Lanham Act violations. Realistically though, it probably would. More realistically however, SCO appears
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If you were on it now you'd be dead.
The lawyers now own the company (Score:2, Insightful)
Didn't the law firm that's running the case basically get handed the store as their legal fee? I'm not exactly sure of the details, and I can't do much checking right now since I'm about to run out, but that was my impression.
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Delisting is the beginning. Then SCO goes down, and Darl... I think he has to go to jail.
reverse split? (Score:2, Informative)
Well, how about a reverse stock split [wikipedia.org]?
"Reverse stock split [...] a reduction in number of shares and an accompanying increase in the share price. The ratio is also reversed: 1-for-2, or 1-for-3."
Of course, the company wouldn't become worth any more money, but the share price would go up.
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Quoting from TFA:
Reverse stock split: Instead of ten shares at $0.90, give the investor one share at $9.00. This is allowed under Nasdaq regulations, but has a fishy smell associated with it. There is an interesting article on MSN [msn.com] stating that 75% of stocks trade lower after a reverse split. My favorite quote is "A stock isn't trad
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Re:reverse split? (Score:5, Informative)
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Will Darl get millions? (Score:2)
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He was making a pretty decent buck off his scheduled trades; this profit was described by Redhat in its legal complaints with the very words "pump and dump". That's normally a pretty serious accusation, though I doubt
If SCO goes out of buisness. (Score:3, Interesting)
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SCOX DELENDA EST!!
Re:If SCO goes out of buisness. (Score:5, Funny)
1) Novell gets Unix back.
2) Novell does deal with Microsoft.
3) Novell changes name to SCO.
4) Novell (i.e. SCO) stops SuSE.
5) Novell (SCO) sues IBM.
6) Prifit!
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What can IBM do? (Score:3, Interesting)
Might want to ask on Groklaw (Score:2, Informative)
My guess is that unless they can "pierce the corporate veil" they'll be stuck in line with other unsecured creditors.
If they can pierce it then they can go after executives and maybe even the law firms or the individual lawyers. Even if they don't recover much, if the lawyers wind up holding the bag it will send a message to corporate land sharks everywhere: Don't participate in bogus lawsuits.
If you just want to punish the landshark
not actually delisting... (Score:5, Insightful)
What is *more* troublesome for the SCOundrels is that if they're under $1 on May 15, they're likely to be dropped from the Russell Microcap index, which would likely trigger a selloff from funds referencing it.
As much as this stock is being shorted by people waiting for the death plunge, either case may be enough to finally tip it over. And with the case obviously headed for oblivion, the likelihood of a Black Knight stepping in with bags o' money again is pretty slim.
SCOX DELENDA EST!!
Re:not actually delisting... (Score:4, Informative)
http://www.timeanddate.com/counters/customcounter
gives you a countdown to "Hells Bells" at this point they need to
A get above $1.00 for 10 days
B maintain the other requirements
C fight an Armageddon level filing (the constructive trust filing by Novell)
IF ABC does fails Then TSCOG is D E A D (in full monty python flying circus fashion )
In other news... (Score:5, Funny)
Technology experts Dan Lyons and Maureen O'Gara were also on hand to bolster SCO's claims. "We've seen all the SCO materials and while its far to secret to disclose, there is no doubt in our minds that NASDAQ is actually a front for Groklaw."
Truncated quote (Score:4, Funny)
Who gives a shit? (Score:3, Insightful)
Off the top of my head (Score:2)
What can a company do to boost its share price?
For SCO, off the top of my head I'd say fire Darl and turn over every last bit of his correspondence to the SEC. Then stop pursuing baseless lawsuits as a means of revenue. Shareholders are not interested in companies that play the lawyer lottery as a business plan. Finally, make a fucking product and sell it.
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It's probably a couple of years too late for that anyway. But if SCO-Caldera had continued with their OpenLinux distro (which in its day actually wasn't too bad, it was one of, if not the, first easily-installable distros) they'd be a lot better off. Who knows, Novell might have bought them instead of SuSE.
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Not being snarky, but could you show me a company that relies on litigation as their primary revenue stream that's doing well in the stock market?
As for looking at the bottom line of a company - sure. That's important. But I was always led to believe that investment managers also look at the company as a whole before investing. Profile the company a bit to get a feel for their future worth. The lawyer lottery can be great but it's hardly what you'd call stable. And IIRC, stability is one of the thing
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I know what they can do.... (Score:5, Funny)
Boosting prices (Score:3, Funny)
I suggest sending out 400 million anonymous emails: SCO has announced priority production of devices based on its proprietary technology. Analysts indicate that there is "almost limitless demand for this revolutionary technology". XYZI is rated an immediate and "STRONG BUY".
Re:Boosting prices (Score:5, Informative)
http://it.slashdot.org/article.pl?sid=07/03/09/02
Re:Boosting prices (Score:4, Funny)
Although we'd never consider suggesting loyal Slashdot readers with access to mail servers might do such a thing ...
How to boost share price (Score:2)
This time even without the dreaded pump'n'dump.
Could survive for now on reverse splits (Score:4, Informative)
There are still enough shares outstanding in the public float for a few more reverse splits. 2:1 reverse would take price to $1.88 leaving approximately 7.8 million public shares; 3:1 reverse to $2.82 and 5.6 million pubilc shares; 4:1 reverse to $3.76 and 3.9 million shares. For the requirements listed on page 14 of listing requirements (http://www.nasdaq.com/about/nasdaq_listing_req_fe es.pdf - PDF warning) the first is only being met with stockholder's equity (which is about $8 million). The second and third (publicly-held shares and market value of said shares) are in no danger of dropping below listing requirements. SCOX shouldn't be in danger of being delisted but their only option may be a reverse split since a buyback would not only drain cash reserves but also lower shareholder equity, which must be at a minimum of $2.5 million or else the stock gets a delisting notice yet again.
Reverse split (Score:2)
In a stock split, your 1 share becomes maybe 10 shares. That share which was selling for $100 is now 10 shares each selling for $10 (note: I didn't say worth, when it comes to stocks price and worth are two different things).
In a reverse split, your 10 shares become 1 share. That share which was selling for $1.00 is now 1/10 of a share selling for $10.00.
BTW, given the importance of corporations a
pure speculation (Score:2)
In a way... (Score:2)
I also believe that just crushing SCO the corporation isn't sufficient. There are people who made buckets of money because of the litigation strategy. No one should profit by leading a company down a slimy destructive path. For the sake of stockholders everywhere I hope the people responsible are hel
They're hosed coming & going.... (Score:3)
Losing the Novell case would also make Red Hat
Awesome! Let's celebrate! (Score:2)
Hey everybody, PaRtY at my place!!!!!!!!!1
Oh, wait.. [bbc.co.uk]
McBride (Score:2)
A warning to any company that hires this guy.
I won't buy your products, if a customer of mine is using your products they won't for very long.
McBride=Blacklisted from the computer industry.
If the guy gets a different job in a different industry, more power to him.
-Hack
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Re:potential source of income (Score:4, Insightful)
Otherwise, you're just another SCO troll.
He can't say who he is or he'd be sued (Score:2, Funny)
Agreement between SCO, Inc. and [redacted]:
The party of the second agrees not to disclose any of the lies he hears from the party of the first.
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Some SCO trolls must have mod points.
Re:potential source of income (Score:5, Funny)
Hold him back, he's desperate.
Actually, he's close .... (Score:4, Funny)
He's only out by two letters. It should read: "
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warning: The above content may test positive for sarcasm and/or could be a failed attempt at humor and as such should be taken with a pound of salt.
Re: potential source of income (Score:3, Insightful)
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Yeah, they've got another obsolete piece of software that nobody uses anymore. Because, you know, it's impossible to write an independent implementation of a language with merely a several hundred page ISO standard to work from.
"But someone from SCO claimed that they own C++"; is that not so? It's complete rubbish. -- Bjarne Stroustrup's FAQ
Re:New CEO (Score:5, Funny)
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It already is. Have you priced a package of toilet paper lately?
Poor Choice (Score:2, Funny)
Two reasons not to use SCO stock for TP:
1. Paper cuts.
2. Already full of "stuff".