I can think of a few reasons:
- It will take time for the management to win back the Market’s trust after previous instances of aggressive revenue guidance to possibly jack up the prices to do a QIP.
- The company’s inability to do a QIP at these prices will hurt its ability to do further acquisitions. The market doesn’t believe the company can grow organically.
- Low margins compared to 8k Miles even though both are quite different in what they do. Low margins also mean the market doesn’t like company to take on debt to make acquisitions.
- Significant jump in Goodwill on the B/S. This is bound to keep going up because of the company’s penchant for acquisitions. The market fears a possible impairment at some point.
- Possible lack of understanding of how different digital technologies are from the traditional IT.