Pat - The market's reaction to NN lately seems to be completely news driven - when news is forthcoming and good, the stock rallies; in the absence of news, the stock fades. Now, given NN's earnings history in the most recent quarters, I suppose I can't fault institutional money for being a bit gun shy (i.e. "once bitten, twice shy."). After all, more than a few investors have been burned by NN in the last year.
As such, there seems to be a reluctance to step behind NN until they have released a good quarter or made some additional contract announcements. The silver lining in this scenario is that institutional reluctance now could translate into a bandwagon effect in June:
1. There are currently 7 "hold" recommendations and 1 "moderate sell." IF NN can post decent numbers, some of these analysts will have to capitulate.
2. As I noted in my last post,there is no shortage of news worthy events in June (e.g. Supercom, etc.). If NN has any tricks up its sleeve, they will likely appear here. Historically June has been rich with new product intros, contract announcements, etc.
It doesn't take much to envision a scenario where NN meets consensus and sets off a few upgrades. If we couple this development with a few favorable news releases, watch out...NN could be back on track in a big way.
(you could also envision a scenario where NN misses their numbers, ASND, FORE, BAY and CSCO all conspire to steal NN's business and the stock crashes back to the teens, but that's no fun...) |
