Acme Packet: A Small Company With Great Potential

On Tuesday, I submitted a new buy recommendation to subscribers of the website I write for, RealMoney.com. The company is called Acme Packet (APKT).

The following chart shows where the stock stood as of Tuesday's close:

click to enlarge

The problem is that on Wednesday, the stock ramped +9.25% on a huge volume spike. But I don't think my readers had time to get in. At this point, I would probably prefer to wait for a pullback as opposed to chasing the stock.

The company makes session border controls (SBCs), which is jibberish for cutting edge telecom equipment that helps make next-generation IP networks operate more seamlessly. It is still a small company, but it has great products, and a leading market share in this emerging space.

The stock has pulled back significantly from its highs at the end of 2006, and it has only been public since last October. I think the stock is on the mend, and has already seen its lows. The company reported a solid quarter recently, and management gave bullish guidance about its outlook.

Wednesday's big rise on surging volume validates my thesis, at least in the near-term, but I still think there is more room for upside.

Disclosure: The author is long APKT.

Comments

[Christopher...:]

how can we take you seriously when you don't even have the correct ticker symbol in your writeup?

2007 Aug 23 07:24 AM

[Jordan Kahn:]

Chris,
I don't know what you're talking about.
-jordan

2007 Oct 16 02:07 PM