By: wannabetrader
Reply To: None Thursday, 9 Mar 2000 at 5:55 PM EST
Post # of 9402
I posted a chart of INIT up at:
geocities.com
just got bored and decided to show you guys what I've been looking at for a while. despite all the complex amateur T/A autoxxer does over on yahoo, the chart of INIT's pretty plain and simple: it's a trend stock. sell when the stock's just way off the trendline, and buy back when it comes back to the trendline...and of course, run for the hills and don't be left holding the bag if INIT ever breaks down below the trendline :)
This is the reason why VRIO is tanking:
It's pretty simple actually, the stock was trading on a pretty steep short term trendline in anticipation of earnings, and boy did earnings disappoint. As you guys should know by now, beating/meeting EPS estimates just doesn't matter, especially in a GROWTH stock like VRIO.
I saw VRIO tank the day after earnings and immediately thought "I wonder what their sequential growth was..."
Well, guess what? VRIO's news release didn't even MENTION 99Q3 revenues vs 99Q4 revenues. Sure, they posted revenue growth of 114% in 1999 vs 1998, not too shabby, but not revealing enough. I had to dig into SEC filings for VRIO for LAST quarter, and here's what we get:
4Q99 revenues: 73.0M
3Q99 revenues: 68.3M
Ouch. 6.8% sequential growth from last quarter, that kind of low revenue growth figure would make ANY growth stock tank. Pretty convenient that Verio decided to "de-emphasize" that figure by excluding it altogether from the press release huh?
Anyhow, longer term, the stock's still good, I haven't done enough research into VRIO (since my plate is pretty full atm) to figure out why they posted such disappointing quarterly growth, but they maintain nice fat gross margins at 70%. I also decided post a chart up for you guys...it shows the short term and long term trendlines. If you guys didn't already catch it, the buy was @ 55 today. I bought in small @ 55 for an intermediate term bounce, and it might pull back to 55 for a retest, but everything points to $55 as support: previous high @ 55, consolidation @ 55 before the breakout at the start of the year, long term trendline, declining volume, and flattening MACD. I think it might have enough strength to bounce back to the 50 day MA @ 65 before consolidating for a while.
chart's at:
geocities.com |
