Chid:
USRX went as low as 89.75 (intraday), i.e. bounced off the support
level at 87-88. 92.5 was the previous support level.
I agree with you, when CFO says that he is comfortable with earnings estimates,
it means that actual earnings will almost certainly be higher, barring
major problems. The CFO will never say that unless he/she is pretty
darn sure, because if they miss there will be lawsuits, and plenty of
them.
It is now very difficult to put up a target price for USRX now because
the PE has now become flexible. Over the past three months, USRX's PE
is rising from the 50-60 range. If the market decides that USRX
deserves a PE like ASND and SHVA, target prices could be really high.
However, if the market decides that USRX is just a modem company, the
target price is in the 90s. My feeling however is at least $125 will
be reached because so many analysts are saying so. I am worried also
about so many analysts starting to cover the stock. This is good news
as well as bad news, because sooner or later they will disagree and
cause damage. From experience I have seen that stocks with the
greatest amount of analyst coverage perform the worst in the stock
market (I can bet on that).
I am worried about the recent behavior of ASND, and FORE. CSCO and COMS
seem to be getting stronger. Momentum money definitely has left BAY, let
us hope that it rotates to USRX. CSCC went up so fast that I could
not catch it. Let us hope you are right about $132 as ROBOSTOCK
marches on.
Deepak |
