wht say you to today's 15% drop? Company specific? CLRS is my Portfolios DOG.
CLRS has gone from my portfolio's show horse to dog in about three weeks. But I think its canine days will be few. When a selloff is this severe, it can be either technical or it can be because inside info has been released and those in the know are dumping. I consider the latter very unlikely here because: (1) the secondary road show and offering just finished, and things could not have turned bad this fast; (2) the expectations for Q1 are low anyway; (3) CLRS received another buy rating today and $140 price target, this time from Wasserstein Perella -- I don't think management would dare, at this stage, lure an analyst on board if they were about to report lousy numbers; the sharks would tear at the carcass ferociously by this time next month if they tried that, and then what would management have gained?
So that leaves today explained by technical factors and the sector-wide and tech-wide selloff. It was a little disconcerting not to see CLRS participate in the last half-hour rebound, but CLRS often moves on its own without paying any heed to what the pack is doing.
We have here a $1B company with more than $200M cash (mostly from the offering), the potential for a MSFT investment and promotion down the road (what better time to invest than after a selloff?), and an interesting niche in a promising growth market filled with opportunity. We have increasing analyst coverage, all of it at least moderately favorable and all of it after recent due diligence, one would hope.
Sure there's a downside, or we wouldn't be seeing this much selling. But this may be a golden opportunity to nibble, or take a flyer on some OTM calls with expirations late in the year. Come the 4th quarter, this could just as easily be at 250 as at 50.
JMHO,
MAD DOG |
