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Here's what I posted on the premium board (located here: http://boards.fool.com/4056/stmp-dives-on-quotwish-listquot-...

Shares recently took about a 10% hit based on a purported document from the White House that is said to include a proposal to return the USPS to "a sustainable business model".

Traders sold shares with thoughts that "a sustainable business model" at the USPS would put Stamps.com at risk.

Perhaps so.

I have a couple thoughts on that:

1) The USPS has an arrangement with several companies, including Stamps.com, because it has proven to be a profitable one for the USPS. Would a revamped USPS no longer find this arrangement to be profitable? That is speculative.

2) I chose the subject title of my post deliberately. Many proposals come out from any White House and not all come to actually happen. That is much more the case with the current administration, where proposals and statements sometimes seem to fly out. It has been difficult for the US government to enact ANY changes in recent years. Controversial changes are even harder.

It has ALWAYS been a risk factor with Stamps.com could see substantial changes because much of its business relies on a contract with a US government entity. Occasionally, rumors....or, in this case.... suggestions or wishes.... cause a hit on the stock. Unless we start to see some traction in Congress for a change in the USPS, I don't think there is much to be concerned about (subject to a further comment below). Just look at the messes we've seen in Washington over health care and immigration. Has much happened there? Despite massive noise? Not that I see.

Now, my further comment. :) It's quite possible that the more visible potential for USPS change could put a damper on STMP stock performance for a while. Maybe. Maybe not. I just mention it because perception is a strong driver of short term stock behavior. In the meantime, REAL news in the form of quarterly earnings is expected to arrive around August 1st.

https://www.cnbc.com/2018/06/21/stamps-com-shares-dive-on-wh...

Bottom line: No need for panic.

Rob
Rule Breaker / Market Pass Home Fool & STMP/MTH Maintenance Coverage Fool
He is no fool who gives what he cannot keep to gain what he cannot lose.
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