Consider FRPT a leading breakout candidate on fundamentals alone.
This company has been under a massive mis-information campaign and naked short selling.
Future Orders
RUMOR
The shorts play up the recent story that the Marines will cut back on future MRAPs orders.
FACT
a. What they leave out is that the Marines already placed almost a half billion dollars in orders with FRPT in Oct., before they considered cutbacks.
b. The apparent reason for the cutbacks on MRAP fuure buys is for the Marines to start buying FRPTs new Cheetah which will replace the hummer for safer statical missions.
Capitalization of new Orders
RUMOR
FRPT will have to go back to the capital markets to raise up to $150M by equity or debt.
FACT
So what? $150M is nothing in light of the $1.5 the government ALREADY owes FRPT on active Purchase Orders. Thats without counting the $2.3 Billion in DOD orders earmaked in Dec
Stock Dilution
RUMOR
Some pompus clown on this MB was mentioning that FRPT shares swelled from 1 million to 61 million in seven years. I suggest he go back and learn that this company was started with an OTC shell and not even in the same business.
FACT
FRPT has the same amount of shares today it had the day it opened on the NASDAQ.
FRPT went from no orders a year ago to have the leading market share in MRAPs. It did this beating some of the biggest names in defense.
Rumor
Iraq War will end in 2008
FACT
Iraq war will last until 2012 no matter who wins the white house
Afghanistan is not goin away either
Foreign Armys drool for genuine FRPT MRAPs
Scenarios
FRPT is a clear takeover target
FRPT is over-shorted (21% retail shorts following bad advice) and only so many will fit through the door when the buying starts.
FRPT has been on the naked short list for 101 consecutive days in violation of REG SHO.
FRPT could see a multi billion dollar order in a matter of days.
60 days from Q4 reporting that will reflect massive profits and the shape of things to come.
If you are not buying or adding, you will miss a huge gap up.
$10.00 is a artificially low price. Fidelity owns 12% of FRPT and added in the $20's
$30 remains the target for those of us who can separate fact from fiction.
