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Electronic Arts Inc. (ERTS) Message Board

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  • jamok99 jamok99 Jun 22, 2005 1:00 PM Flag

    1 problem with battlefield

    turtlepal,

    I'm holding a small ATYT position that's been bugging me, and I'd like your view on it. I got it around, I think, $16, and I've been indecisvely toying with selling it each time it dips below 13. The lack of clarity bothers me, both on the SEC suit against the CEO for insider trading, and more so for current supply issues for high end boards, as well as specs, release date (on time in Aug?), and bin yields for their next gen R520 series. This all has to work in order for them to right the ship, and the lack of clarity, coupled with their recent failure to execute properly, is troubling. If in the CC they successfully address these issues, people will see the stock as dirt cheap, if not.....
    The other point of view is that, long-term, 6 to 12 months out they should have cleared up all these problems, and we're probably headed for a hardware upgrade cycle. So one could just say sit with it and look at it a year from now. But if things go badly, we could see single digits before we see high teens. Your thoughts?
    Also, did you load the boat at 50, just nibble, or something in between?

    Best,

    Jamok

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    • Hmmm, yes you're under a bit on that, but not panic time yet. Personally I think it might test the 52 week low tomorrow and I'm in around $12.80 which is fine by me. Right now we're in a bit of a transition for PC cards, but as prices come down and 360 launches it should be party time for ATYT; they also wont get jerked around in pricing from MS (if you're familiar with the MS/NVDA issue and that NVDA won) so that's good. But, I don't think party time for the stock price will happen until late summer. Just a hunch.

      I haven't looked in detail at their bin yields and all that jazz, but generally speaking these types of things for any given chipset sort themselves out in 3-9 months. If they give guidance to this effect you should be fine. If they dodge or something, well, maybe time to unload here. Ultimately if it's not something you're dying to get the principle back out of I'd just load some more now, and see what happens and wait. ATYT is hungry to continue their relatively short reign here in this market, I don't think they've held it long enough to get comfortible and that's why I'm confident in the longer term.

      ERTS was a 1/3 bite and another nibble at $51.50 before the drop to $47ish. Haven't bought more though wish I did. I'm still uncertain about the next q or so, but otherwise think we're at an okay level. Holding for now :)

      • 2 Replies to turtletracks32
      • I don't have much credibility here, I know, but I'm not exactly able to put in words a view on ATYT. Al I can say is "sell it," and "sell it now" because of something you both might not see coming. And it is coming from Asia in force (hint: dig into who's bene eating at ATYT, among others). You both have been farting with ATYT (Turtle mentioned ATYT back when it was $15-$17, as did you, Jamok) for a long time, and the stock in terms of management and industry position ranks right up there with my idiot farting with MXO around $7 a long time ago (thankfuly, I owned STX and WDC also). There are winners and there are losers in this sector, especially with the direction 3D graphic chips/multimedia developments are going (in a aword, commodity: an inflection point in terms of needless out-performance has been reached---just look at which long-time holding funds and institutions have been selling ATYT the past 2 quarters). I know this may be totally wrong in assessment, but I think you'll see ATYT (if current management digs in and is not removed; if they are removed, then I may change my outlook) at less than $5 in--and this is key---in less than 12-15 months. Jmho.

        RunningBear


        PS Besides, you're going to need the tax write-off for when ERTS blows past $80 by Xmas in the last wave of craziness before the USA starts downhill again. Jamok, you've done it again with ATVI. You got me in right below $14 and I am sitting on a 29% return in less than 7 months (ranking right up there with the near 50% return on ERTS you garnered me when you got me in at $45 a long time ago and I managed to sell some, at Turtle's urgings, above $63). Anyway, kudos, my friend, big kudos.

      • Looks like we could get below $12 on ATYT today on the Q4 warning which should not come as a big surprise to any of us. I will be looking to pick more up below $12 and holding on.

        Any opinions and or estimates on ERTS' NPD numbers coming out tonight?

    • You too Jamok. I picked up 2000 shares this morning. I have some in a retirement account but not much. Will add more after we see what earnings bring. Personally I would not mind if it got whooped but I dont thin that will happen since they have already warned. I beleive they could possibly come out with a fair bit of positive spin with Xbox launching in less that 5 months.

      Also shorted another 1300 EA and picked up some July puts as well. I am looking to close out some of the short position if we get what I expect to be weak NPD numbers tommorow. I am looking for $33 million in sales for EA or down another 20%. In deeep on this EA short here but I really think this rise is unjustified but as you say EA confounds all reasoning at times.

 
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