Don't miss this morning's regular installment of Herb on TheStreet.
One of those innocuous items at the end of my column
yesterday mentioned that analyst Richard Leza of
John G. Kinnard
had initiated coverage on
with a neutral rating and a target price of 3 1/2 -- a gutsy call on a stock that was trading in the midteens. His comments preceded a
move by a
Food and Drug Administration
advisory committee late yesterday not to recommend approval of Sunrise's laser treatment for farsightedness.
That prompted a mild, and I do stress
, move on the Hostile React-O-Meter.
Typical was my correspondence with reader
, who wrote: "I have recently renewed my subscription to
. Until recently, I have enjoyed the articles from the various authors. On the whole, most articles are well presented. However, the recent articles regarding Sunrise Technologies by
and now again by yourself are biased and unprofessional. It certainly raises the question of credibility and personal agendas.
should be above this."
To which I replied: "Sorry, I don't see how pointing out that an analyst has a $3.50 target is a problem. If I were an investor ... I'd want to know that."
She shot back: "The report to which you refer lacks credibility and distorts facts. This is not the first time that this has occurred with this firm. By using their information, without the other side being presented, interferes with your own
credibility. I do have to say that I am impressed with your quick response." (Ah, shucks, I do try!)
My point here is not to embarrass Karen; she was kind enough to write in with serious, well-intentioned comments that lacked hostility. My point is that investors must understand that Jesse and I, and other reporters at
, are merely passing along info we believe, based on our sources, is timely and pertinent.
Here was an analyst, Leza, willing to put his neck on the line with a gutsy call that a stock was worth around one-fifth its current price. Did he catch flak? Sure, he says he was slammed on Internet message boards. But no wallflower he: Today, in the wake of the news, Leza cut his price target to 2, based on what he calls the "best case" scenario that delays in approval by the FDA will now take a year. He adds, however, that if based on "normal" expectations the target would be more like 50 cents.
At last check Sunrise was off 10 9/16, or 71%, at 4 7/16.
Herb Greenberg writes daily for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, though he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. He welcomes your feedback at
email@example.com. Greenberg also writes a monthly column for Fortune.