December 4, 2007
ParkerVision Stock Falls After Barron’s Magazine Questions Technology
By Mark Basch, The Florida Times-Union, Jacksonville
Dec. 4--ParkerVision Inc.'s stock dropped to its lowest level of the year Monday morning as a story in weekly financial newspaper Barron's questioned the viability of ParkerVision's technology.Jacksonville-based ParkerVision is marketing wireless radio technology that the company developed. The company has said its technology, designed for use with telecommunications devices, provides superior performance to other products. But while ParkerVision introduced the technology 10 years ago, it has not found many buyers for it. The company has lost money every year since it was founded in 1989.
The Barron's story cites the work of two Silicon Valley entrepreneurs with technical backgrounds, Mike Farmwald and Barb Paldus, who have been refuting ParkerVision's technological claims. The married couple maintains a Web site (www.pvnotes.com) to state their case against ParkerVision and its founder and CEO, Jeff Parker.
"He's made just unbelievably outrageous claims about it," Farmwald told The Times-Union Monday.
ParkerVision responded to the article Monday morning with a conference call and a press release. The company said the couple has never discussed the technology with management or visited ParkerVision for a demonstration of it. Parker said during the conference call that he was "outraged" by the article.
Parker said the story contains "information that is not truthful from a couple of people who stand to gain a great deal financially should we not succeed in our business plan."
Farmwald and Paldus have been short-selling ParkerVision's stock, Barron's reported. Short sellers are investors who expect a stock price to drop, and they profit when the stock actually does fall. A short seller initially borrows shares of a stock and sells them at a high price in the open market. When the stock falls, they buy shares at the lower price to pay back the shares they borrowed, making a profit on the difference.
Farmwald said Monday he began shorting ParkerVision stock four years ago, but hasn't made any trades in the stock for about a year.
ParkerVision's stock fell from $9.83 at Friday's close, before the Barron's story came out over the weekend, to $7 in the early minutes of trading Monday. It closed Monday at $8.52, down $1.31 on the day.
ParkerVision has faced a problem like this before. From 1999 through 2004, a New York investor named Manuel Asensio, who is known for short-selling stocks, issued a series of press releases questioning ParkerVision's technology.
Asensio's comments were featured in financial magazines Forbes and Fortune.
ParkerVision's stock peaked at $56.44 in 2000 before the bursting of the tech stock bubble and publicity about Asensio's comments helped bring the stock down. It fell as low as $3.45 in 2004.
The stock got a lift earlier this year when ParkerVision in May announced a licensing agreement with ITT Corp. to use its technology, the company's first agreement to sell its wireless technology to a major manufacturer.
ParkerVision's stock reached $16 in August, but it began to fall a month ago after the company's third quarter financial report showed it had only taken in $284,000 in revenue so far from the ITT deal. ParkerVision recorded a net loss of $13.5 million in the first nine months of 2007.
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