Internet America, Inc. (OTC:GEEK) had an interesting increase in trading activity at the very of the last week, and provided a worthwhile follow up with over 36% price gain on Monday.
Share price volatility is not a new thing for the stock, thus rapid contraction might follow. Trading volume was 23 times the average last Friday, but failed to follow up, making the price jump appear unprecedented and fragile.
No news or updates were presented to justify the jumps in volume or price. The stock merely fluctuates around 20 cents level, which was previously accepted as justified valuation for the business.[BANNER]
Revenues have been stable throughout last year, with slight drop off to the end, but reduction in SG&A expenses allowed to book profit at the same time. Net tangible worth has increased by 33% for the last reported quarter of 2010. The company is steadily repaying debt as well.
These slightly favorable fundamentals have been influencing the share price since the last financial update in November. However, the current market cap is already more than twice the GEEK book value, and lack of revenue growth, or any general direction whatsoever, prohibit more meaningful stock price advances.
One of the more noticeable events was the increase in fully diluted number of shares in the last reported quarter, as 2.8 million of preferred stock were convertible. Such an increase meant 17% dilution to shareholders.
