Between mid-September and mid-October, the price took a ride down to the 50-day ma, bounced up re-testing the prior high unsuccessfully, took a ride down to the 100-day ma, then commenced to make an assault to new highs as it broke out at the pivot point on strong volume in early November.
There looks like 2 scenarios possible:
1. This is the next leg up, without any real testing of the 100-day ma, other than a few brief moments near it for 2 days. MACD never really had a chance to get back under zero, but it crossed over, so you never know. I think this scenario will prove its merit soon enough, based on the success SMTC has re-testing and punching through $55-57.
2. This is the early leg, where the price re-tests $55-57, makes a first pass unsuccessfully, prompting the price to re-gather near the 100-day ma, gaining a strong level of support from institutions, and slams through into new highs, especially as it moves past the pivot point.
Either way, the way I see it $72-75 is the next stopping point and that's not bad work for a few months work. You're probably right, because as MACD comes around, usually as soon as it begins trending up, the price is off to the races. That's the way things shape up now, so it would take some unknown uncertainty to prompt scenario #2 to come about.
What's in a name? EVERYTHING!!!
Semtech benefits from it's name closely resembling that of Sementech which was a consortium of companies that was formed by many big name players (IBM, MOT, TI, INTC, etc.) to advance the state of the semiconductor industry. I'm sure they benefit from this fact, much as Juno Lamps did as you described. Speaking of that, all I can say is HAHAHA, that is soooo... funny, and it made my day because I had missed that bit of news :o)
I don't mind the name, and after more than 25 years of business, I'm sure it will stick. But, you are right, the name does not convey the same level of clarity as say Analog Devices, Inc. (ADI) does. It worth mentioning that SMTC is eating ADI's breakfast, lunch, and dinner (as well as several others, especially those that begin with Micro :o), so relative anonimity does not appear to be a problem.
Coorelation is getting hard to find, I think much of this is based on the fact that the market is very highly valued. Being so, I think there is a stock pickers market of sorts taking place. The general market follows, but only the TRUE leaders receive the big bucks, and therefore deviate strongly from both the average and median. It simply means if you buy average stocks, you're going to get average returns at best. SMTC is not in that category, as evidenced by the stock price.
I remember stating last year SMTC was going to prove itself in 1999, and the proof was going to be it's ability to command a signifigantly higher PE multiple. That indeed has happened, and I think this vaildates my position that SMTC has assumed a LEADERSHIP position in the industry. Not based on market cap, but rather where it matters much more, technically superior technology. What this means is SMTC will continue to flourish, even if others within the industry group falter, since they are now perceived as a leader.
Analog companies are not well understood, ask John Baumann at SMTC. I'm sure he constantly must explain what the company does, which I think also adds positive potential to the stock price. As people come to understand the necessity of analog, and witness stellar performance through a business model based on producing proprietary technology, they come in late game and provide additional bounce.
Analog semiconductor companies really need their own industry group to be honest, SMTC has as much in common with INTC as American Airlines has with Union Pacific Railroad. Both transportation companies, but definitely different beasts. Same thing as far as I'm concerned, when comparing analog and digital semiconductor companies. Oh well, look at the price :o)
Good luck, logic tells me the price continues, a nagging voice in the back of my head says it has to re-group one more time before moving on. Either way, holders of patience are rewarded once more with premium performance.
It has been a good year for SMTC, and without a doubt I know the whole process begins with one key factor ... PLATINUM MANAGEMENT. Said it for almost 3 years now; this fact cannot be disputed (Leeza has been saying it even longer, I must tip my hat to the MF Mom).
OFF-TOPIC
I suggest Gemstar International (GMST) warrants careful study, and in my estimation a sizeable investment, as I see it poised to erupt into an imminent 10-bagger based on a near-monopoly position forged from a patent portfolio of highly proprietary technology. It's my pick for the next 3-4 years going forward, then again what do I know? :o)
Yabba, hope everyone is having a GREAT holiday season, best to you all.
Regards, JB |
