if you are buying at these levels ..just ask yourself what are earnings going to be a year from now ..apply a decent p/e ratio and a good PEG..and ask if you mave upside other than momentum upside. I did when the stock was 73 and come to the conclusion that it wasnt worth it. You may come to adifferent conclusion ..after the short covering fizzles out ..whats next?
Good companies, with improving growth prospects, rarely come cheap. Infact, I've kicked myself more times than I care to mention for not getting into companies such as Starbucks, Whole Foods, Apple, etc... when it became obvious that they finally had a sustainable hit on their hands. With improving sales growth and more and more acceptance, these companies more than doubled in 1-2 years from where I said "too expensive".
ISGR should not be the core of your portfolio. It should be invested in your speculative portion. As a speculative play, it is all but certain to be volatile. If you want safe and steady, buy P&G, Costco, Altria, YUM Brands, Target, or any other big cap steady plays. Similar stocks should already make up your core porfolio. Otherwise, you may be taking on too much risk.
Also, you are more than welcome to wait for a pullback. It is all but certain that ISRG will have a pullback sometime in it's future. That said, the pullback may only come at $100 back to $85... only to recover sometime later. On no news, stocks simply tend to follow their trend... which you can figure out by simply looking at the chart... If you want to wait... and just watch the price of a good stock creep up and up, without you on board, be my guest.
>>after the short covering fizzles out ..whats next?<<
The short ratio as of mid June was 6.5, meaning that short covering would take a minimum of 6 and a half days... Well, 10 trading days have passed since earnings, so I would think that all the shorts who wanted to cover have done so...
> I would think that all the shorts who wanted > to cover have done so...
> Dr. Grumpus
The July short figure was 2.2 million and I bet that this number hasn't changed much. I think the shorts that were hurt and covered at earnings were immediately replaced with new ones. Look at all the this-stock-is going-down-hard posts.