"Anyone PLEASE!!
I would love to get back into this fine company. Is there a consensus on where the possible bottom is?? Where is the most resistance??"
Most of the resistance is in my brain, as I do everything I can to stay busy and not buy. KLAC, another great company, is lower than I imagined, just 2 weeks ago, it would get. I am not alone. I would have bought much higher than these levels, if the drop had been slow. You have to know the difference between being lucky or smart.
Dennis, there is simply no reason to rush in here. Owners of shares should hold. There is no good news on the horizon.... the latest intc fiasco of last friday put these stocks over the edge. Intc is going to have decent earnings...partially by cancelling equipment orders, we can be sure.
As Teri and others have pointed out, clearly and frequently since last October, these stocks can go as low as 1x sales. amat is close to 2x sales now. If you look at other equipment makers, they are either at 1x sales or closing in. Amat has to slide to around 13 to be at that level. There is nothing to hold it up.
I could go on forever, but my own answer to your question is this, the same answer I gave 6 months ago: the potential bottom is 12-13. That can actually happen. If you don't want to miss the possible move to 100, and you know that it could drop in half first, then you could nibble a little. I have taken that tact before, and it worked well, both in 1996, and this past December. In 96, the lows were so low any fool could make money..and I did. This past Dec, prices rose so quickly, it didn't take a genius to figure out there wasn't a lot of upside past 40 in the near term. Now we are heading back into the abyss.
So, I think most would agree that the bottom is between 28.5 and 13... I sound like I must be almost a genius to have figured that one out, eh? Now, as we go down, the reward gains dramatically on the risk. Somewhere between now and 25, I will buy 20% more. Mind you, I would have told you 2 weeks ago that I would double my position by now.... But I have learned to avoid falling knives. I now believe that we should drop to at least 1.5 sales, a share price of about 20. At that price, there is downside, but not a bunch.
Hope this helps... remember that these are potential prices and are realistic. But just my opinion.
gene |
