If an investor bought Divx (DIVX) three months ago at the peak of the buying frenzy in the company’s stock, he would only be down about 32% now.
What happened?
Wall St. is concerned that the company is not growing very fast anymore. Revenue in the fourth quarter of 2006 was $16.7 million. The first quarter is being forecast at $17.3 to $19.3 million. At the lower end that is only 3.5%.
For the nine months ending September 30, 2006, revenue rose 93%. But, for the three month period ending September 30, revenue was up only 77%. In 2004 and 2005 revenue roughly doubled over the previous year.
It’s easy to see Wall St.’s concern. The company still trades for 11.6x sales.
Douglas A. McIntyre
Take Charge of Your Retirement In Just A Few Minutes (Sponsor)
Retirement planning doesn’t have to feel overwhelming. The key is finding expert guidance—and SmartAsset’s simple quiz makes it easier than ever for you to connect with a vetted financial advisor.
Here’s how it works:
- Answer a Few Simple Questions. Tell us a bit about your goals and preferences—it only takes a few minutes!
- Get Matched with Vetted Advisors Our smart tool matches you with up to three pre-screened, vetted advisors who serve your area and are held to a fiduciary standard to act in your best interests. Click here to begin
- Choose Your Fit Review their profiles, schedule an introductory call (or meet in person), and select the advisor who feel is right for you.
Why wait? Start building the retirement you’ve always dreamed of. Click here to get started today!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
Our expert who first called NVIDIA in 2009 is predicting 2025 will see a historic AI breakthrough.
You can follow him investing $500,000 of his own money on our top AI stocks for free.