Handheld Entertainment Pulls a Googleposted by MR WAVETHEORY at 11/16/2006 12:55:00 AM
Handheld Entertainment Inc. (Nasdaq ZVUE) wins the most speculative stock award for today. The company makes Personal Video Players - basically iPods videos- and it zoomed up 303% today because it bought a video website called dork.com and announced it would turn cash flow positive. The stock traded at $1.67 in the morning and by the close of business it had completely ignored the laws of gravity and reached $6.10. In the meantime, the float had turned over twice and everyone had made a bundle.
Is Handheld Entertainment trying to pull a Google? I think so. Is it a mini Google? Probably not.
For starters, Carl Page, the CTO of the company, is the brother of Larry Page of Google (Nasdaq GOOG) fame, so maybe there is a bit of Googleness in ZVUE. Just like his kid brother Larry, Carl purchased a video site, but that is where the similarities fall apart. One small difference: Handheld paid $1.5 million for dork.com while Google paid $1.65 billion for youtube.com. Another difference: Handheld zoomed up 303% the day after the announcement. In comparison, Google barely budged.
Handheld may be trying to copy Google, but it's hardly the same business. Handheld Entertainment is a hardware company. They sell $99 video players through Walmart that compete with the iPod. It's an interesting device but there's just one small problem - it comes with just 128MB of memory. ZVUE was even planning to do an iPod knockoff, but I think they realized in good time that competing against Apple is quite a tough calling in life, so they shelved their plans for releasing an MP3 player.
Handheld seems very speculative and that's why it wins the honor of being the most speculative stock of today. With 303% returns, who needs venture capital anymore? Don't even mention private equity. Is this a speculator's market or what?!