Michael,
I agree that the high flying year 2000 stocks will continue to
decline. There are only three such stocks, however. ZITL,
ACLY, and TSRI will drop further in the short term. Other year
2000 stocks that haven't taken off don't look so risky though.
UCMP for instance looks pretty stable and has a low PE. Other
year 2000 stocks mentioned in this and other threads remain pretty
cheap (e.g., CCEE, TPII, ISLI, etc.). The question ACLY investors
should ask themselves is whether it will become like ZITL, VIAS,
and CHRZ (i.e., high volume, active stocks with wild price swings
able to sustain high valuations) or more like TSRI (i.e., small
stock losing volume and fading back into obscurity).
Just so you know, I am short ACLY. I think that ACLY will gradually
fall on low volume to around 13. I'm surprised that ACLY has avoided
any big drops recently (i.e., last few days). But it's pretty clear
to me looking at the chart that ACLY is dying a death of a thousand
cuts. Unlike ZITL though, I don't think that ACLY will rally again.
A short squeeze might work on ZITL but it won't work on ACLY because
volume is low and people seem to have lost interest.
All is not lost for longs though. Maybe an announcement or two
will pull ACLY back up (briefly) although not enough to help the
guy who bought at 30 two weeks ago.
Regards,
JW |
