It's difficult, no - impossible, to predict how the market will react after an earnings release. However, as I said in an earlier post, I think NMGC finally came close to articulating a vision for life after notebooks.
The doubling of R&D expense is the sole reason earnings didn't blow estimates away. Considering what NMGC was able to accomplish in the past with smaller R&D expenditures, I'm intrigued about what's cooking this time.
Unless I missed something, the only downside is that they didn't explain exactly what new business products they plan to introduce or exactly why the market should beat a path to their door. However, given the highly competitive nature of the industry, some circumspection is a good thing.
I'm thinking about a comparison between NMGC and DELL. Similar EPQ, but a huge difference in the share prices. One approaching maturity and slowing growth, another possibly just breaking out. Both companies have solid financial, operational and marketing teams in place. Too early to tell, but I bought 4,000 shares at $13 7/8 this week (covered my behind with a few puts over earnings just in case) but after the CC don't see much immediate downside risk.
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