I'll wait until earning is out. Anything could happen in the next three weeks. It just had one up day (which is today, and we have to see whether the closing price holds up), and remember it had been in the pattern of up one day and down three days during the last two months. I will suggest extreme caution in this kind of risky environment.
Several fundamental questions are still not answered for ATML:
[1] Revenue picture for Dec.
[2] Future revenue growth (BTB for the Dec. quarter)
[3] Pricing pressure (ATML's competitors INTC and AMD are not earning money in flash, I think the pricing pressure is very high)
[4] Startup cost inline? (the process they're using is complicated, a ramp up like this is costly sometimes)
Seems like the IR is not helping at all with these questions. At the same time, you have insiders selling at 22-23, you have institutions pulling out one month ago, you have two downgrades in the last 2 weeks, you have the winter so cold this year that the Asian flu is not going away in a week. I wouldn't throw money at this stock until my questions are answered in mid-Jan.
I might be missing a few points, but it'll be much safer. BTW, I think 22-23 is a natural resistence considering the insiders sold at those prices, the most I could be missing might be only 3 points from here. But if it drops further, I'll probably get a lower entry point and more buffering zone.
Also, watch out for the bullish sentiment on this thread. Most of the time the mood was upbeat in SI, the stock went the opposite direction. You probably need a lot of people like me on the thread to really call it a bottom.
Good luck!
Frank |
