The stock dropped down yesterday to a close at $1.54 on selling out volume nearly five times the average. Almost 300,000 shares were traded and as the shares are still not oversold, for the most faithful New Frontier Media shareholders remains the slight hope that the negative trend will eventually reverse, despite the disappointing annual results and the lack of considerable corporate updates.
Yesterday, a positive feature of the stock was pointed out, but it was obviously not positive enough. With its beta of 0.9, NOOF came on the list of the five companies with the lowest volatility, as measured by the beta coefficient. Though, the value as of today is 1.40, so it looks like investors are losing one of their arguments to invest in the stock.
Hopefully, the results from the annual shareholder meeting will provide further and more stable arguments. It will be held in less than a month and the election of six new directors and the company’s 2010 Equity Incentive Plan are among the important issues to be voted. For now, it looks like investors are still cautious, expecting the new members of the senior management and possibly more urgent dilution risks.
Until then, the latest corporate update from the beginning of this month will have to attempt to hold market’s interest. Then, an announced new agreement of the wholly-owned subsidiary Colorado Satellite Broadcasting, Inc. with DIRECTV, Inc. replaced and extended the previously existent agreement between the two companies.
The full terms of the agreement are also still to be filed in the next 10-Q, though it is known that DIRECTV will further distribute adult programming television networks owned and operated by New Frontier Media’s subsidiary.
