Tuesday, July 17, 2012

BOREF Caution

A couple of weeks ago, I passed on a tip for BOREF, which is another undiscovered company with mature, sock-o technology that's remained beneath radar. I bought it at $5 last year, and it shot up to $17 (on news that a number of airlines signed "intents to buy" Wheeltug after a trade show demonstration) before setttling back to $13.10.

The Slog's resident banker-wanker looked into BOREF, and notes that it's not only a parent-of-a-parent company, as I knew, but that its specific structure affords maximal leeway to do as they'd like with wheeltug revenue - e.g. disperse it to the various sub-companies without passing into BOREF itself. Big red flag (and ripe for "pumping and dumping" - which I'd never do, hence this warning).

The current run-up in the price is halo effect, but at some point, there may be a horrendous reckoning if the money goes everywhere but into BOREF.

That said, it may still be a smart investment. If contracts are actually signed, this $65M market cap company will surely go way above $17 on the news, and it will take a while before the fine points of internal corporate accounting are revealed. But we've got to be careful with this one, and get out on the early side, even if potential profit is left on the table.

Thanks, banker/wanker.


Ghalib Suleiman said...

I'm tired of SIGA being down in the dumps.

Jim Leff said...

Patience will be rewarded!

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