Unlike in the beginning and then at the end of July, as the market was shocked by Cambium’s plunging down and recording new lows, on Friday the shares did not manage to get oversold. The stock again plunged down by 2.15% to close at $3.18 and to reach a new yearly bottom at $3.10. The selling pressure was considerable, nearly 600,000 shares were traded, but still it seems that some investors believe that this is the final bottom for the stock, or are hoping that there will be enough buyers in the coming days who follow the “buy low” strategy.
Clearly, the market is not enthusiastic about Cambium’s business and its future prospects. It seems that the only reason for such pessimism are this year’s second quarter results filed on Friday.
It could be the disappointment that the company still couldn’t get profitable despite the more than doubled sales in the three months ended this June as compared to the same period last year. The costs of that revenues grew disproportionally and almost tripled, while the sales and marketing expenses doubled.
Further, it seems that Cambium is holding more inventories, its ability to collect cash from customers is worse as compared to December last year and the cash on hand was reduced by almost 50%.
It seems that the restructuring of the business and the reduction of work force after the mergers at the end of last year are still to deliver the intended positive results.
