Rick, My guess for tomorrow on CRNR is $5-$6 with a close near $6, but it's only a guess. For all I know the big pop in software revenues, the company's future direction, might actually encourage people.
I looked at CATP, 50% growth with a 70+ P/E is overpriced, as is 7xsales for essentially a service company but the beta is .72 (something like that), less than the market, meaning it may not move fast enough to give you a play on puts, especially July. The August 30s (TQPTF) sell for 1 9/16 to 1 13/16. If we get a general pullback in tech stocks (which I'm inclined to think we will), CATP could drop to around 25 and make the puts worth about $4+.
I like the Adobe idea better. They've been pounded into the ground. Adobe has LEAPS, Jan 99 40s (VAEAH) give you a year and a half for
8 3/8.
You might look at ETEC systems, an excellent company from every point of view, 80% market share of the chip manufacturing photomask market, but with probably a couple of quarters of flat earnings going forward. Insiders have been selling at the $40-$45 level. I had some of it long that I paid mid-20s for and sold at 41 5/8. I just bought July 40 puts yesterday for about a buck and anticipate a pullback to the high-to-mid 30s over the next few weeks.
On the general market, a friend and I have been joking that the decline will begin tomorrow at 2:16 EST, i.e., after the Fed does nothing and a small relief rally is finished.
Best,
Steve |
