To me the Oct. bottom was an artificially low 'traders' bottom - while the company was doing everything textbook perfect as far as running a company goes, the street nailed it all the way because it needed to 'move stocks'. I believe that if you believe the right valuation back in Oct. should be around $18/share to reflect market low, then LSI basically just performed to par. The rise last two weeks was not 'excessive', it was just 'catching up because of turn-around' situation - i.e. another way of saying 'let's move some stocks'.
If you look at it that way, my 'supreme bullishness' is nothing more than taking into account the street's needs to 'move stocks'. I guess that's part of Motley's fools' theory too. Of course my understanding of the industry and especially operations helped me to steel up my nerves and stick with it when the share price was nose-diving.
patrick
One additional thought - as I have said before and in my spreadsheet calulations, assuming this is a two year run, it's really tough to see LSI getting to over $80/share from simple earnings calculations. However, knowing things not just tend to, but always get out of hand one way or the other because of the need to move stocks, it's not impossible. But when it comes, will I be selling fast!
Not my game, I don't make the rules. Just trying to understand the selection rules so I can play it better and hopefully make a few $. |
