Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Underexposed Technical Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Underexposed who wrote (651)	11/25/2019 9:30:42 AM
From: robert b furman	1 Recommendation Recommended By toccodolce Read Replies (1) \| Respond to of 914

Hi UE, Excellent and thorough review. If Cohu approaches your limit sell, I'll be selling 15 and 12.50 puts (twice as many 12.50's) with the hope of helping pay for the 15.00's if assigned. Shoot for $1.00 plus on the 15's and 55-75 cents on the 12.50's. That should net some stock near our initial entry price and then become an "ADD TO" for a larger position. It has after all shown good life vs. previous price action. I've owned Cohu since 1978. They have put me through some wild swings as this sector has wide swing cycles. That being said, their revenue stability should appear after the cost savings are achieved - said to be accomplished by Q1 2020. Over a long term history, Cohu's price will reverse up when guidance improves. Weak guidance a bit below the Q3 was given for Q4 of 2019. 2020 is more than likely a better start than 2019. Hopefully 5G will be seen as a boost to new systems orders. Q2 and Q3 are seasonally strong quarters. 5G will drive the smartphone business and automotive although not being driven by unit sales ,rather an increase due to autos employing more content per unit. I have seldom anticipated a strong Q 1 from Cohu. My guess would be a strong guidance for Q2 after Q1 earnings are released. That would be expected to be released late April to early May. Q 4 may well have a kitchen sink expense thrown in - With a big merger, an intangible impairment expense could always buile a loss carry forward for 2020. If Q4 throws in new write offs and Q1 guidance is sand bagged, a perfect buy set up going into Q1 reporting/Q2 guidance may well evolve. I'm very long this stock, but always look forward to accumulating more at a very low price - just a once bitten twice shy hope for value. It seems Wall Street always places a discount in a stock's price - just before a turn of profitability presents itself. IATL = It always takes longer. So I'm thinking Late April to early May is a perfect time to sell puts and buy calls for a synthetic long set up. In between then and now sell lower priced puts for income and savings to be applied to buying some more stock. If price reverses before my anticipated time schedule, I'm a happy camper. Cohu has made these mergers before and they are methodically very good at reducing cost and advancing new systems that gain market share and drive revenue. They are good , but must work within the sector's revenue swings. To me the exciting thing is - the turnaround is now older than a year and the fruits of the merger are now less than 6 months from surfacing. As Louis said, the larger volume ramp of 5G is expected to be seen in Q2. We'll see that in both demand for Excerra's products and Ismeca's turret handlers. That's the stronger guidance I'm hoping to see - which will be reported in the Q1 results webcast. So a washout Q4 and weak guidance for Q1 with Stronger Q2 guidance after the weak Q1 comes in above and gives us stronger Q2 guidance. Cohu's model makes 50 cents a quarter at $200,000,000 in quarterly revenue. That's a big jump from 145,000,000. I t most likely takes several quarters of good growth to ramp up there or all of 2020. In Q3 1997, Cohu announced their first small loss and stronger guidance. Price never looked back and ramped up with a 2 for 1 split and a high of 61.75. 4 to 6 quarters of growth will make this stock a multibagger. The key is to accumulate at a low price and be able to ride the volatility without undue stress. That's a lot of FA. Thanks to UE for an excellent TA review. The combination is a good setup for a wonderful long term buy and hold that will be a wealth creating event for long term holder. A four bagger with capital gains is a thing of beauty. Much like we're seeing happen to Brooks - hint hint to UE for a TA review of Brks. <smile> Bob