<We haven't hit bottom yet. Bottom occurs when we lose a HDD, a media and a head player - not necessarily in that order.>
So, the decline will continue until we see some serious blood? And, with the ability to expand production, will the loss of one player do anything except provide brief relief?
Perhaps what this sector really needs is one strong player and 2 weak players to keep a little fire under the leader?
Looking at APM, they could disappear and would anyone notice? Haven't they actually disappeared already, but just won't admit it? They are down to 6 million in cash from 71 million last year. Can they get through another quarter?
Look at Hutch. They practically own the market (or so we often hear)and they can't make money. I believe it was Lawrence who questioned their great quarter, timed so nicely as to push the secondary out at $40+, only to see the next few quarters of loss. Did they fudge things a bit to get those great numbers? If they did, but figured they'd make it up in demand over these next 2 quarters, only to find this soft market, now we see the result. Only speculation on my part, but clearly they had something funny happen to see this about face in earnings.
Regards,
Mark |
