RawGreed Requests, GTE

Posted on November 13, 2005 , filed under Stocks | Print This Post

Zoran M. writes,

I was wondering your thoughts on Globetel Communications (AMEX:GTE)

GTE, GlobeTel Communications Corp. provides Internet Telephony using VoIP, which I am very bullish on. I expect to see some consolidation among companies providing VoIP solutions in the next 2-3 years. GTE was trading at .25 before a 1:15 split that took the stock to high 3′s on May 23′rd, 2005. I would have expected the split to give GTE some increased visibility and a jump up in price since the stock should appear on the screens of investors that avoid trading stocks with such low prices. Instead the stock has been on a steady decline since the May 23rd split. GTE has recently jumped but if the market takes a dip I believe GTE will follow along with it. I would also watch GTE carefully since the stock appears loaded with speculation and the company has requested a trading review with the American Stock Exchange with allegations of manipulation. I also find it odd that GTE releases news about various LOI’s, Letters Of Intent. An LOI is actually a very weak document since it has no legal binding power. It’s like formally shaking hands in the business world, saying sure we are interested in doing business. A company that announces every LOI should be approached with caution.

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