If you weren’t shaking your booty at that raunchy tech bash a year ago — when the sexy plays in the stock market came with a dot-com suffix or a wireless pitch — you were labelled a party pooper.
Of course, the ruthless old stock market has a penchant for punishing such irrational exuberance.
Hurray for the party poopers!
If you were buying boring, old oil-and-gas stocks a year ago, raise a glass. You’re still at the party.
But if you listened to your bartender and loaded up on Calgary technology companies that were all the rage, such as Cell-Loc, Wi-LAN and SAMSports.com and didn’t take profits during the height of tech fever in February and March, come back from Fiji. The party’s over.
While nursing that champagne hangover, take some solace in that you learned a lesson or two about the pitfalls of buying into sexy business models with too much makeup and little or no revenue.
The rallying cry for 2001?
Value stocks are back in vogue, shout the analysts, albeit late.
So we’re back to the basics where we should have been in the first place. And, you over there, stop laughing at Warren Buffett!
The legendary American investor Buffett was actually being mocked in some circles for his conservative style as he avoided tech stocks trading at ridiculous prices-to-earnings multiples like the plague.
But, as usual, he is laughing all the way to the bank. Buffett’s Berkshire Hathaway Fund was up about 25 per cent for the year.
The Toronto Stock Exchange and the small-cap Canadian Venture Exchange did show modest gains over the past year on the back of steady gains in the oil-and-gas sector.
With oil and natural gas prices skyrocketing, TSE oil-and-gas producers gained 44 per cent.
At the other end of the spectrum, TSE tech stocks were annihilated, with tech software companies down 54 per cent, tech hardware companies down 27 per cent and online services companies down 80 per cent.
The CDNX’s technology index was down 65 per cent, with numerous companies beaten down more than 90 per cent.
Among Calgary-based companies on the TSE, Snow Leopard Resources, a little-known company developing fuel-cell technology, stole the show in 2000 with a 650-per-cent gain.
Snow Leopard (SNW.A), which opened the year as a dime stock, closed the year at 75 cents. But that was nothing compared to its high of $2.60.
Calgary’s other big winners on the TSE were Oncolytics Biotech (ONC), which skyrocketed 344 per cent on excitement over development of a drug for cancer treatment; Meota Resources (MRZ), an oil-and-gas company that soared 338 per cent; Canadian Hydro Developers (KHD), a developer of hydroelectric power projects that escalated 247 per cent; and Wireless Matrix (WRX), a high-tech company in data network engineering that went against the grain, gaining 145 per cent.
Not surprisingly, four of the top five Calgary losers on the TSE were Web-based companies.
Cell-Loc (CLQ), a cash-strapped company which traded up to $80 on bold plans for its wireless-device locator technology, was down 80 per cent after opening the year at $20; Wi-LAN (WIN), a wireless company locked in a legal skirmish with U.S. networking giant Cisco Systems, was down 74 per cent; Zi Corp. (ZIC), a software company featuring language processing technology, was down 63 per cent; and Axia NetMedia (AXX), a software media company, was down 54 per cent.
But even these companies couldn’t steal dog-of-the-year honours from Nevada Bob’s Golf Inc. (NBC), which couldn’t blame the market for its 98-per-cent hit.
The golf retailer dropped to one cent from 50 cents with the crippled company in a restructuring phase after falling $98 million in debt.
Calgary’s CDNX star was flourishing oil-and-gas producer Westlinks Resources (WLX), which spiked 645 per cent from a penny stock to $7.45.
Other big winners on the CDNX were Drake Pacific Enterprises (DPE), an oil-and-gas company that gained 567 per cent; Equess Communications (EQS), a data-processing company that gained 400 per cent; Tiberon Minerals (TBR), which gained 396 per cent in a plunging mining environment; and Jackal Energy (JEI), a junior capital pool company that gained 333 per cent.
A stock-taking of the big losers among Calgary CDNX companies showed four tech wrecks that spoke volumes of a merciless tech market.
SAMSports.com (SAM), which markets online sports instruction, went down swinging with a 94-per-cent drop to seven cents from $1.10. But, in this dog race, it had three companies on its heels — Cybersurf (CY), down 93 per cent; ILI Technologies Group (ILX), down 89 per cent; and Net Shepherd Inc. (WEB), down 86 per cent.
Meanwhile, an oil-and-gas company somehow managed to get caught in the web of CDNX casualties. Solana Petroleum (SOP) tanked from 40 cents to three cents for a 92-per -cent drop.
