Peter,
Good question. But the sad fact is that the probable diminished airline capacity--if it indeed occurs even for freight--will be true for everyone, not just the ECMs. It will mean a higher cost of transportation which will have to get passed on to customers. If anything, the recent events should make the ECM model stronger, IMO, not weaker, as companies try to decrease the inherent risks of doing business and focus on what they perceive to be their core competencies. If that core competency includes manufacturing and fulfillment, then they wouldn't have used ECMs to begin with. The economies of scale will still tilt the balance to the ECMS.
I am still out of all ECM stocks. But still have a fair bit cash, and am looking for a reentry point. I wish I could say it was here, but still believe down is the path of least resistance, perhaps until late this month or sometime in Oct., when institutional tax selling will take everything down again (presuming that they aren't doing it now). The slowdown in the economy will hurt ECM companies quite a bit, and I may well wait for the Oct CCs, even if I miss "the" bottom. I'd rather collect the interest, meagre as it is. Better than losing money. I'm afraid single digits may be in the cards for JBL and FLEX, SLR and SANM are close as it is.
My 2 cents, anyway.
Best wishes,
Sam |
