Evolution, I was watching real time streaming quotes when that trade went by. It was obviously a data entry error where the 3 preceding the 2 was omitted. The bar range immediately showed a low of 2 and stayed that way for maybe 30 minutes when the error was apparently corrected.
For any people on the thread who have been long for quite a while and are now showing a big loss, as I am, I would suggest you listen to the conference call replay on the web site. The company admits that there is no near term visibility. We are apparently in a transition stage where the high end surgeons are operating at maximum capacity and cannot grow anymore. There is a certain percentage of the population that wants their procedure done only by "that" doctor who did their friend or relative's eyes and cost is not a factor. The rest of the population appears to be holding off waiting for the price to drop. Until prices stabilize at a lower level which the company guesses will be in the $2-3,000 per pair of eyes, procedure growth will probably be flat. Wall Street hates no visibility or no growth even if it is for a relatively short period. The stock will probably be stuck in the low 30's for at least a quarter -- certainly more than 30 days. Louis Navellier was the guest host on Squawk Box this morning and Mark Haines asked him specifically about VISX. Navellier said that the stock is dead as long as analysts are lowering their estimates even if they are wrong. He had already lightened up his position and will be dumping the rest because you can't fight the street.
I know I said the other day that I would probably buy more if it dropped into the 30's but that was not based on the assumption that they would have a flat quarter or two. I'm going to sell into the dead cat bounce and take the tax loss. I'll probably be able to buy my stock back lower after 31 days during one of the inevitable market pull backs. As soon as visibility clears, I'll probably increase my position.
There was plenty of good stuff in the CC. There has been no dramatic shift in their market share. Their procedure price has not changed. Procedure revenue was not down and they haven't seen a fall off in order flow. Most importantly to me was the comment that when pricing becomes an important factor in the market place, we will see explosive growth. That could be as soon as the 2nd or 3rd quarter.
Those of you who established new positions or loaded up in the low 30's should do well in 12 - 18 months, maybe much sooner.
Cheers,
Bob |
