Disclaimer: I am a CXTI Shareholder.
I feel sorry to those who bought the CXTI shares around $8 a few month ago, and I am even sorrier if you sold your stock around $3 these days. and here is why.
The sudden resignation of the CFO and its related issue created a situation wall street typically called Sarbanes-Oxley Compliance for CXTI stock. The stock movement shows the public anxiety created by the overwhelming uncertainty of its underlying stock. Stock price drop created by spike in volume of the panic sell, where fundamental has changed little. There are two areas I like to point out. 1. CXTI conduct its bussiness mostly through government contracts. To those are familier with company who operates in China should know better, in order to get almost any government contracts in china, the company must carry extensive relationship with the government, and the responsibility of this partnership is usually lies on the CEO of the company, the departure of the CFO should have little or no impact to CXTI's core business and its abilities of successfully carrying future businesses. 2. In a fast development country like China, there are increasing demand for CFOs, head hunters are always on the run to grab qualified CFOs. The resignation of CFO is my guess most likely related to that.
as long as the fundamental stays the same. I am long on CXTI. please do your due diligence before buying, become of the volitility of the stock, i recommend always use limit orders.
LCFA
$3.02 (08/15/07)
