[svlug] RH dependencies, not using up2date

Ian Kluft ikluft at thunder.sbay.org
Sun Jul 28 02:59:44 PDT 2002

>From: "Rafael Skodlar,,," <raffi at linwin.com>
>On Sat, Jul 27, 2002 at 08:37:33PM -0700, Walter Reed wrote:
>> Hey, I can understand RH's desire to make money. That's just fine. RHN is just
>The trouble is that RH is NOT making money with that strategy
>Symbol   Last Trade  Chg   Jul 26
>RHAT      4.71      -0.56

Daily stock price fluctuations are next to meaningless.  Sort of like
"MIPS" (meaningless indication of processor speed), except worse.

They're just what sellers were offering and buyers were bidding for shares
of a company, with sellers and buyers usually having exactly opposite
reasons on the same day for their transactions.  At least right now, most
tech stocks are getting hammered again, this time following the Worldcom
bankruptcy and the ongoing corporate accounting practices witchhunt.  Except
for major news headlines like that, there's usually no sense or meaning to
be made from daily stock price fluctuations.  Every stock that was buoyed
by the dot-com era's high expectations is down.  The companies that are
competently managed will probably be among the first to recover, whenever
the economy turns to the next up-cycle.  Over the long term (years), a stock
can usually be expected to follow the financial condition of the company
on average, but not on any given day.

Red Hat's quarterly statements have shown them to be squeaking in profits
for about a year.  And this past year has been a difficult one for most
businesses so that's nothing to sneeze at.  Even Cisco (with its previous
reputation for visits from business school professors to see how it's done)
has only re-emerged into the black for the past year, not followed there
yet by any of its competitors.  Times are tough.  Even though it says good
things about Linux that Red Hat is able to be any bit profitable in this
business climate, it almost certainly indicates that the company has some
reasonably competent financial management too.

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