Hi Cadaver. Since I am new to this forum, I would like to say hello to you and all other participants. I have been watching this thread for some time now and I am impressed. I like shorting a lot, much more than going long. Except for days like July 16th when I sold all my puts and bought calls on AMER, ASND, CSCC. All the stocks that you mentioned are on my "hit list", but I would like to add one more-QCOM. They just announced earnings of .02cents/share and stock promptly tanked $3.5. P/E of 100 and broke support at $40. When NASDAQ goes down to 1000 my target for QCOM is $25. I have been watching MSFT for 6 month now. They have been able to deceive people(of course analysts and entire brokerage community are part of this conspiracy) by comparing earnings to low base quarters of last year. But the truth is that MSFT is a company with sequesentialy declining net earnings and flat revenues. Here is the proof 1Q-.78c,2Q-.90c,3Q-.88c,4Q-.84-86c?. Revenue 1Q-2BN,2Q-2,2BN,3Q-2,2BN,4Q2,2BN. My price for MSFT is 97 earnings estimate of $3.9xP/E of 20(rich for co. with no growth)=max. $78. When will finaly somebody yell "King is naked" and lower their rating to hold?. They really have to deliver or they are in trouble and NASDAQ with them. I think that their earnings release might trigger next leg down on NASDAQ to 980-1020 area. I think that NASDAQ is in a bear hug now(not just a correction). If 980 doesn't hold next support is around 900 for juicy 30% correction. In my opinion communication went down last not because of complacency of investors but due to fund managers releasing its iron grip on this group. They finaly realised that slowing earnings growth momentum can't support P/E of 50-100. Therefor this group is going to get flattened next. My guess is that by the time they are done P/E's will be closer to 35 of 97 earnings estimate. Apply this ratio to Shiva and others in the group and you will arrive to final prices. I did the same analysis with ALTR when it was trading at $ 65 and my target price was $ 30. They even betered my forecast.
P.S Does anybody remember what was MSFT's consensus estimate for 4Q in April when they released 3Q results?. .90 cents. ANALysts were quietly lowering number to .84 to make sure that MSFT makes it or WOW beats by a penny or two. HOGWASH. I also checked their financial statements. In 2nd and 3rd Qs tthey were booking unrealised profit for Windows 95 that was well ahead of actual sales. At one point they either really have to sell this stuff or tell the truth and write off this gains. Right now they are racing against the time hoping that sales pick up and justify their creative accounting. BTW I am buying August 120 puts on Monday, just in case if they open like SUN,NSCP,FORE or IOMG(God. I missed this one waiting till day after the announcement) |
