One perspective from a former Rambus long.
I bought in the low 80s last May after reading a magazine story about it, then with impeccable timing added to my position in the low 110s at its peak in July.
Then, in August, I discovered SI, G&K, QCOM, etc. In the portfolio restructuring that followed I held on to my RMBS position, but decided to learn more about it and see whether it could really stack up as a potential holding against the other great companies discussed hereabouts.
Reading the Rambus thread, however, was disconcerting. First, there were more than a few bears, and not all were unintelligent. Second, even some of the bulls conceded that Rambus had technological shortcomings, and based their optimism on faith in Intel (d)ramming it down the world's throat. Third, the stock didn't go anywhere, except possibly down a bit. And fourth, given its then-current valuation, it was not at all clear that--pace dear UF--there would be "staggering" returns in the foreseeable future.
When QCOM took its recent nosedive, I scrutinized every other position I had to see where I could raise money to buy more, and that was when I decided to sell my Rambus shares (at about 91). My reasoning was that there was a chance (however slim) the Rambus bears were correct, and that even if they weren't, there would be plenty of time to buy back in over the next few months as Rambus' potential started to be realized.
I'm not happy to see the recent report and downturn, but I'm not entirely surprised either (this is hardly the first snag or delay), and I am glad to be out, at least for the moment. The more I learn about QCOM or, say, GMST, the better I feel about my investment in them--something that was simply not true about Rambus. As has been said before on this thread, the goal of gorilla gaming is to get high returns TOGETHER WITH high safety--and for the present, at least, Rambus just doesn't cut it.
BWDIK,
tekboy |
