The Falkner Follies; Stark Exits Stage Left

This blog last mentioned R. J. Falkner and its research relationship with a number of rather dubious public companies in June of last year. For over a year afterwards, no updates had been forthcoming on Falkner's coverage of REFR. Given the policy as stated on Falkner's research front page that updates typically occur about 3-9 months apart, it seemed reasonable to conclude that Falkner and REFR had had a parting of the ways.

Then last week, a message board posted stumbled across links to a new Falkner research report on REFR. You can scan the content of the report for yourself if you like; it's mostly a regurgitating of every self-promotional effort REFR has made over the past ten years. But what is interesting is the fact that this report is not as yet linked to the website's front page as the other companies' reports are, while the old report has been taken down in place of a stub that gives an executive summary of Falkner's ever-glowing evaluation of REFR, but with next-to-nothing in the way of detail.

One item of interest in the as-yet-unlinked report is a revamped list of the top institutional investors. Most of these are institutions with total-market index funds, meaning they invest in just about anything on the listed markets, which, as of yet, still includes REFR. But the list is already out of date: the top institution on the list, Botti Brown, just reported having sold 150,000 shares, more than half their March 31st position, dropping them to third on the list, while the #4 top holder, Stark Investments (they of the placement in February 2005), has sold out their position entirely. Rather pathetically, only ten institutions now report holding more than 1,000 shares of REFR, and of those, only three have fewer than 2,500 positions (in other words, the other seven very likely hold REFR as part of an indexing).

With apparently less than six months of operating capital left, it's really starting to get down to crunch time in REFR's efforts to gain new funding. Will Falkner's report help them out? We can only wait and see...