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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: HammerHead who wrote (173)	2/14/2001 9:04:31 AM
From: dennis michael patterson	Read Replies (5) \| Respond to of 52237

Apropos of the thread discussion of analyusts yesterday, Cramer has some good comments today on INTC Betting Against the Analysts By James J. Cramer 2/14/01 8:41 AM ET Oh boy, I say something even remotely positive on tech and the emailers come out of the woodwork to ask if I am getting more bullish on the group. Whoa! Yesterday I blasted First Boston for downgrading Intel. Frankly, this is where you need an analyst to tell you to hang on, or hold out at least, because in six months you might get an upturn from the cycle. The perma-tech-bulls (endangered species?) glommed onto that note as an endorsement of Intel. It was more an attack on the way analysts do business. Part of being a great analyst -- like being a great comic, I guess -- is timing. You have to be in a position to help people make money. You can't when you are so out of position that you recommend Intel all the way down. You have to position yourself by your upgrades and downgrades to be ready to make a big long-term call to make people money. You can't do that riding down Intel all the way. I felt the same way about Cisco (CSCO:Nasdaq - news - boards), and PMC Sierra (PMCS:Nasdaq - news - boards) and now JDS Uniphase (JDSU:Nasdaq - news - boards). Analysts shouldn't defend all the way down and then capitulate. They have to split before things get bad and start liking things when they get ugly. They need to be ready to upgrade at the moment when they see the light at the end of the tunnel. These guys at First Boston were positive until they were in the tunnel and then -- when they are two-thirds of the way through -- they downgrade. That's value subtracted. As a hedge fund manager who made his name betting against the psychology and actions of analysts, I would have used yesterday's downgrade of Intel to get ready to buy it. There will come a time when things simply aren't that bad in Intel -- probably, if history is any judge, when everyone has a weak hold on the stock. We aren't there yet, but we sure got a bit closer with yesterday's downgrade.