Once again something looks fishy to me. Did you notice the stock sell off hard the last hour of the day as the rest of the market rallied to new highs? WCII actually went negative on the day after being up well over a point. It also broke a short term trendline support. There seemed to be institutional selling today. Given that the stock just bounced up from 11 to 29 dollars(!!!) in 15 days I expect to see some heavy profit taking and selling going into the earnings report. The Lucent deal was responsible for the huge jump, but taking a closer look at it, it is not as good as everyone originally thought. That is not to say it is not good, just that the stock seems to have run far ahead of itself, since the deal is really just 500 million guaranteed with potential 1.5 billion more over the next 5 years. Does that really justify a 165% gain in 15 days?
I sold my stock 2 days ago, and todays performance makes me think I can buy it back before earnings are out (or just after) below 20.....just look at another stock I owned called Safeskin (SFSK), it dropped hard the 2 days before earnings after a nice runup, and then, even though they beat earnings by 2 cents the stock was taken out and shot...dropped a total of 12 points in 2 days (29 to 17 1/2) , high to low....now I am not trying to compare the 2 companies, just the similair trading action that took place between the two. WCII is suddenly weak in a strong market, and no doubt there were a lot of people and institutions caught long in that big dropoff to 11 two weeks ago. I am sure many of them have sold, and the rest will sell into the earnings number. No need to get greedy, right? I suggest selling until the number comes out, and then trying to buy back in the high teens. I am confident we will get the chance.
Remember, 165% return in 15 days......thats a lot to leave on the table before the earnings number.........;^) |
