Topic : Vishay Intertechnology (VSH)
Forum : Individual_Stocks
Their recent earnings report, which described the year to date, gave not a single word of forward guidance. With good reason Dr Zandmann avoided this, as IMHO I think that the next 12 months will NOT be good, neither for VSH nor the sector.
In fact, I've got 3 very good reasons for shorting VSH, and any one of them is reason enough alone.
1. VSH is primarily a manufacturer of passive components. After an 18 month roll, the market is in steep decline. Although the telecomm market is holding up, the computer market is very slow, and competition in the consumer electronic sector is getting even tougher with more and more bankruptsies. Lead times for components are back to 30 to 45 days for most common passives. Worst of all, customers are cutting their stocks and all the double bookings are coming to light. So much for the record order backlog.
2.Prices are falling rapidly, now that both Samsung and Murata (2 of their largest competitors) have significantly increased production capacity and are dumping
3.Rumour has it that VSH has got together a large stash of cash and is in the market to buy a large active semiconductor company, and the deal is near. I won't mention the names I have heard, but it will be a big one, and it will not IMO be positive short term to the stock price.
So add it all up, and there is not one good reason for VSH to go anywhere but down in the near future IMHO |
