Flextronics trading out of kilter with rest of ECM.
I like it here, among all the larger ECM stocks, although DIIG is starting to look reasonable here too. For example, Jabil and Solectron both traded below FLEXF's stock price last December, and now both trade significantly higher.
The question is: Why is it falling on light volume? Perhaps the big money managers don't want to purchase before they see the terms on the recently announced Silicon Valley ECM company acquisition. Or perhaps, they are hearing disparaging comments about FLEXF from competitors, who feel that Flex may be expanding too aggressively.
But based on my discussion with Marks, I expect a terrific year building out capacity in Europe, China, and Mexico with big revenue growth. At some point, if the revenue growth slows, the margins should improve.
I have had some good stock moves in my portfolio this week, especially in a speculative stock I've been buying under 5, which spiked 40% this week. I plan to be in the market buying FLEXF next week, if it stays in the 37 range. My last buy of FLex was the purchase of some April 30s when the stock was 33-34.
In a year downside is 30, upside is 70-100. JMO.
Paul |
