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Harmonic, Inc. (HLIT) Message Board

  • wallisweaver wallisweaver Jan 21, 2008 3:46 PM Flag

    The Week Ahead

    Well, it's shaping up to be an interesting week.

    Certainly tomorrow looks like a train wreck but the situation is not without danger for the bears/shorts.

    Take Apple which has earnings tomorrow after the close.

    And Microsoft which has earnings after the close on Thursday.

    We may get some of our best indications that the global economy is doing well this week. Will the shorts be crazy enough to try to drive down Apple and Microsoft one and two days before earnings? Gee, I hope so. Because these days I live for the short smack down which is coming.

    I guess I'm quite surprised by the futures drop as it seems the news over the weekend was quite favorable to a bottom and moving up. A lot of people indicating even if we had a recession it would be short-lived and not that big a deal.

    As far as this being a result of the bad reaction to the stimulus plan, don't make me laugh. The stimulus plan is more political than economic.

    But earnings are starting to collide with the market's irrational fears and ignorance.

    HLIT is a great example. Lots of evidence of a good quarter and more to come. And a hugely beaten down price. Well, less than 10 days to earnings. Will the shorts hold through earnings? Gee, I hope so. I hope they sell like there is no tomorrow right up and until earnings.

    I still can't construct a scenario in which HLIT will report bad numbers for the first six months. With a backlog of 3-4 months in the hopper already, it appears that numbers can only ramp up for the first 2 quarters and by that time the economy will be ramping up for the last 6 months of the year.

    If there is something wrong with my "backlog" analysis, someone please point it out.

    This is my supposition:

    Shorts/bears are beating everything down. In general things are not nearly as bad as sentiment indicates. The general beat down is excessive for most stocks and in the case of the best of tech it is stupidly excessive. Earnings will show this.

    We should have some pretty good evidence of whether I'm right or wrong this week.

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    • Yes, another mild disappointment.

      But actually I'm not too disappointed with these 10 percent drops. Especially since the numbers are so strong.

      I think they represent improvement in the market's irrational disposition.

      And I see the market's ability to beat stocks senseless is coming to an end. Look at what a difference a day makes. Yesterday we were looking at world meltdown. Today certainly something less than that and maybe even some optimism.

      I see no reason or ability to pre-judge Microsoft. Apple is the company I knew the least about. Microsoft has been ramping up on Vista and Office. I am only confident that they will also put up strong numbers.

      What you have to remember is 12 hours ago the markets were telling us that we should be in total crisis mode and huge gaping chunks of value needed to be removed from every stock. Today you see yet another big tech making billions of dollars and continuing to grow profits. Maybe not blow out profits but a very, very long ways away from the "sky is falling".

      What we will find when tech after tech puts up good numbers is that a small adjustment is the only one needed and that most have already received an excessive adjustment.

      Today was the first day in a long time where we saw that hysteria was not going to rule the day. The shorts have to be devastated. Their biggest payday ever was snatched from their pockets while they were on the way to the bank.

      Of course they are determined scumbags and will be back at it tomorrow. We just have to load the shotgun with more salvos of good tech earnings and keep shooting them in the ass until they lose their enthusiasm for coming over the wall. They looked a little punch-drunk today. We now know that they are vulnerable. An important psychological change.

      An awful lot of earnings yet to come. Perhaps another Fed cut next week. Let's not throw in the towel simply because Apple's mere $1.6 billion in quarterly profits (57 percent increase) was over-shadowed by conservative first quarter guidance.

      I think you need to decide whether you want to be right or you want to be happy. You seem to want bigger and bigger catastrophes to prove that your warnings were prudent. Well, we already know your warnings were prudent. But it doesn't mean that you won't still have been right if things start to improve. I think it's your time to demonstrate that you can look at things the way they are instead of the way you want them to be.

      The sky isn't falling. It's just got a couple of holes in it. Look at the massive profits big tech is cranking out. Let's stop pretending that the numbers don't matter.

      The numbers matter.
      Rationality matters.
      Restoring integrity to the market matters.
      Getting rid of the hype matters.
      Resisting the chaos matters.
      And buying when prices are beaten down matters.

      When the market turns and heads up it is going to do it in a hurry. We should all be preparing for that...

    • AAPL is a buy at these prices

    • Well, that's two now wally. Great numbers for AAPL and then lower guidance. Huge selloff in AH with a little recovery but still no huge runup. The silver bullets are starting to tarnish. MSFT will do the same in some sort of fashion. No help for HLIT with these tech issues.

    • Well, your instincts were good once again.

      I'm glad that you clarified the "hysteria" issue because sometimes it does sound as if you are in a state of panic.

      I just don't think it's ever good to convey this except in a non-emotional tone in a public forum because the shorts feed off of these emotions and use it to beat the longs silly.

      This will be an interesting and hopefully pivotal week for tech stocks and HLIT in particular. We still have a chance to get out of January in good shape.

    • There is nothing wrong with your assessment except that the world is melting down on the credit issue and the markets are in freefall. HLIT cannot hold up under that pressure. If it does, I will be very surprised. The bears rule the roost as of now and for the forseable future. Bad and worse.

      • 1 Reply to m6s_cool
      • Perhaps, but I can wait the ten days necessary for the real numbers to rain on the short's HLIT parade.

        And I can wait the one day for the real numbers to rain on the short's Apple parade.

        And I can wait the three days for the real numbers to rain on the short's Microsoft parade.

        It's been a long season but at last the rains are here. Bears only rule when there are no benchmarks against which to measure their "sky is falling" rants.

        I count at least three benchmarks in the next ten days.

        Not including Philips which announced today. For a glimpse of reality read on:

        "Philips boosted by global spread

        By Michael Steen in Amsterdam
        Monday Jan 21 2008 19:15

        Philips said on Monday its businesses - ranging from consumer electronics to lighting and healthcare - would be able to weather an economic turndown thanks to booming business in emerging markets.

        The Dutch group's fourth-quarter results beat expectations and showed an improvement in margins. It said net income had risen to €1.39bn ($2bn), against €680m a year ago, helped by sales of stakes in Taiwan Semiconductor Manufacturing (NYSE:TSM) and LG Philips as part of its strategy to focus on lighting, medical and consumer lifestyle. It proposed a raised dividend of €0.70 a share.

        Philips said its full-year margin, on an earnings before interest, tax and amortisation basis, rose to 7.7 per cent from 5.2 per cent a year ago. It avoided precise forecasts for 2008, but said it was on track to raise that margin to 10 per cent by 2010. "[We have] all-in-all a robust portfolio with an ability to weather times of slower economic growth and an excellent geographic spread, with 30 per cent of our sales across all divisions coming from emerging markets," said Gerard Kleisterlee, chief executive."

    • Wobbly Whopper, did your girlfriend dump you for a short/bear or something worse ? You are full-time obsessed with the shorts. Wake up.

    • The backlog should continue to grow since what HLIT sells is meant for a market stretching out years rather than just a few months down the road.

      Agreed that the stimulus is likely to be a bad joke. Giving everyone $800 the government borrows from overseas to spend on chinese goods from Walmart is probably going to stimulate production in China but do little to create decent jobs here. Starting to take the health care monkey out of production costs, lowering corporate tax rates and giving carefully targeted incentives to job creating investments is the way to go. It'll get shot down because some unscrupulous politician will characterize that as " corporate welfare " to score some easy points and the average voter isn't educated enough to know any better.

    • The market may not do tomorrow what everybody apparently thinks it will do tomorrow. I'm convinced "the market" does have a sense of humor. We'll see.

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