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No. of Recommendations: 9
hi all.

here are my reasons why the stocks declined.

1) it had run up qute a bit in the last 3 weeks, probably on expectations of a super quarter. well, the quarter was great, but some traders tot it was not super. note that their revenue increased while marketing cost decreased. this bodes well.

2) CNS will earn 0 to 3c per share in the 4th quarter. this is compared to 4c in the year ago period. this lowered figure is enough to give people the jitters. but the reason for that is increased marketing. this makes sense to me as there are only 2 quarters in a year when their pdts are truly in demand, and the 4th quarter is the peak. so spending to gain awareness is a good move.

3) the revenue from international shipments will be 'moved' to the 4th quarter to coincide with the japanese peak season. this shows that they have inventory under control. remember that they ship to retailers who sell to consumers, so again, it make sense to ship only when their pdts are in high demand. not having proper inventory control and overshipping , resulting in a backlog, was a main reason for their losses a few years back.

people who only look at the result without understanding the reasons are missing a buying opportunity here. all in all, the company is laser focused. they are executing well, margins are up and sustainable, and they are not breaking the bank for growth and profits. how i wish i could find 5 more companies like CNS!

there is absolutely no reason at all to doubt they are losing traction. the cashflow statements are not out yet though.

alex.
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