There is very strong resistance at $15.00. We all know that your firm began shorting IOM at around $25.00. The only "squeeze" I see is your firm trying to greedily "squeeze" just one more nickel out of this one. I think your firm's greed on this one is unjustified especially with solid resistance at $15.00 staring you directly in the face and knowing that more than 10 major OEMs are packing their machines with IOM products, increased Malaysian productivity, Malaysian tax incentives and so on. I honestly think your short dollars would be better parked in a company with a hundred plus P/E at this point. Regardless of your description of major short selling occurring now and on any rise in price, it certainly is not reflected in the daily volume numbers I look at. The IOM volume is very very low, which is what happens when a stock forms a base. The $15 base could last 1 day or last 3 or 4 weeks, but that is what is happening. IOM may spike down significantly intraday, but it will always close closer to $15.<<
Since when is volume of almost 2,000,000 shares low? Future IOM earnings conjecture is NOT money in the bank. They are a guess. They are no more valid than my claims that CD-Rewrite will eclipse Zip's claim as successor to the 1.44 MB Floppy. This is my analysis, and I think it is valid. There are arguments others presented over why CD won't succeed. One of these was speed. This hasn't stopped CD-ROM from becoming the standard in software distribution. Nor from it becoming the primary game playing medium. The Cost of Manufacturing CD's and CD-Rewrites is CONSIDERABLY less expensive than Zips or EZ_Flyers. Right now, a bulk purchase of a 640MB Write-Once CD is $5.75, and dropping. When CD-Rewrite comes out, it will certainly cut into IOM's sales whether they be Jaz, Zip, or Ditto. A 640MB Rewritable CD will not be proprietary like Iomega's stuff, and therefore it will be adapted very quickly. Remember, that CD-Roms are standard equipment on virtually ALL computers sold these days. The upgrade from CD-Rom to CD-Rewrite will seemingly be a natural progression. From a supply-side argument ALONE I can make the case for CD's over Zips. The COGS will be less, and the margins HIGHER for CD's. Iomega had a great 2 year run. But all good things must come to an end. |
