I'm trying my best to figure out what would keep someone in a short position here. It's pretty clear they are solidifying their position as a top tier company with sales and margins heading the right direction. What is the downside (and the profits for the shorts) from here? Seems pretty minimal vs. a monstrous upside potential. Pretty poor risk management to stay short at this point it seems to me, but that's just my opinion. Maybe this will make them start heading for the exits. Not in a panic short squeeze sort of way but in a just realizing the easy money has been made and time to get out before a serious squeeze DOES happen - like a blowout quarter or major OEM announcement.
They left some pretty big upside surprises in the outlook - LOTS of stuff not included in the revenue guidance that could amount to seriously beating estimates going forward.
Are you kidding me?
They have a LTM which calls for 30-40% GM. They talk about it every roadshow they go on. They even guided that they'd hit the low end of that GM target by Q4FY13 (this was a few months ago). And guess what? They're going to hit it and then some.
So by your twisted logic how does ANY growth company that has not yet made consistent profits justify ANY market cap?
Look at FIO - LESS revenues than OCZ, NO profits, Market Cap 8 times higher than OCZ.
Or Netsuite - FAR LESS revenues than OCZ, NO profit ever and none in sight, market cap 10 times that of OCZ
Profits in the early stages of a major growth trend are non-existent for most growth companies and it is the growth that matters. Profitability comes with increasing sales and that is exactly what is happening here.
I could care less if the stock is under pressure for the next few quarters because I have a minimum 1 to 2 year time frame to let this story fully unfold. I stand by my original post and this is just a really poor short candidate at this price and this time.
as the quarter in fact was a mess and the next quarter will be just slightly better based on current guidance. Full year revenue and margin guidance looks ambitious to say the least.
As the company has constantly overpromised and underdelivered (especially on the margin side) so far I guess there is plenty of reason to believe in even more weak execution going forward.
The company will finally have to deliver on guidance to get the shorts out of the stock. But this will be at least two quarters away from now.
Based on past experience the company should miss on full year guidance by a large amount as they issued this guidance without the needed visibility into second half of FY13. IN fact they just wanted to calm down investors on the dismal last quarter.
Remember the company has sold huge amounts of new shares in the last year with all of these new investors are substantially under water. This creates ongoing pressure on the stock.
As OCZ remains in show-me mode I guess the stock will show some wild swings tomorrow but at the end of the day will stay pretty much were it ended today.
don't forget about $700mm revenue forecast. So, like I said the other day, they will announce $1bil in revenue by this time next year and we're at $6/share. Lets be real....It's time for CNBC to start covering the SSD sector and start friggin talking about how everyone is trying to catch up to what Ryan has done and is doing = largest SSD provider. HUUHHHMMmMM!!!! What the hell wall street. Did you all graduate after the tech boom. It's TIME TO BID UP THE PRICE RAPIDLY!!!!!!!
How can they control the price without shorting even more and getting even more exposed? Smart money is going to have to see the potential here and realize how undervalued the stock is. Staying short is an invitation to lose the profits gained by shorting in the $8-9 range with very little to gain. My guess is more upside pressure on the stock than downside going forward. We'll see what the "market" has to say soon enough.