you are correct on all accounts -- it's tough to tell if this will be a 2-3 quarter problem or a 2-3 year problem. it's also tough to quantify the revenue implications. in the face of confusion, investors run for the exits, and this is reflected in the stock performance. regardless, CA's problems are definitely more than minor, and this situation is worse than last year's Europe incident. this is a risky time to buy in given that this problem is capable of keeping the stock down for years. i personally will wait for some signs that things are turning around. i would rather miss 3-4 bucks on the upside and buy in when things feel more comfortable, rather than be susceptible to any more downside and be constantly worried about my position.
the guy at Prudential made such a stink because from what I hear, he had been bearish on CA for the last 3+ years due to the potential for this problem, which, unfortunately for him, was the wrong stock call over that time period. so about 3 weeks ago, the guy was finally tired of being bearish because of a problem (licensing agreements) that didn't seem to impact the company, so he revised his thinking and upgraded CA to BUY. then CA blew up. the guy seems to be a contrarian indicator. i almost feel sorry for him.
-ranch |
