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This is all good:

Revenues and fees for the second quarter were $47.4 million, an increase of 19% over the same period a year earlier. Gross margins were 59%, compared to 50% in the second quarter of 2001. Revenues and fees and gross margins include fees earned from Visteon and expenses that are reimbursable by customers. Operational income for the second quarter (excluding non-cash stock-based expense), was $4.7 million, or $0.10 per diluted share, compared to a $0.17 per share operational loss in the same period last year. The Company generated positive cash flow of $5.8 million in the second quarter, versus negative cash flow of $7.7 million in the second quarter of 2001. Including stock-based expense, net loss for the second quarter was $87,000, or less than one cent per share, compared to a net loss of $240.8 million, or $6.15 per share in the second quarter of 2001.

This is not:

The Company reaffirms its previous full-year operational EPS guidance of $0.25 per share, but is revising its full-year 2002 revenues and fees guidance. Revenues and fees for the full-year 2002 are expected to be between $180 million and $184 million, 10% to 12% lower than previous guidance of $205 million.

Seems a pretty extreme reaction in the stock. So if everyone was believing the previous projection, you would expect a big drop, if they weren't then you would have expected a higher stock price before the announcement.

Has anyone done any detailed anaysis of what these projected numbers mean for valuation ratios? With this kind of drop, on a company about to turn a profit(?) I feel like bargain-hunting. Any reasons given for the reduced projections?

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