JPM's opinion means very little to me. However, its downgrade has and probably will continue to have a depressing effect on Avid. They are just too big and many investors follow their lead.
I personally have failed to justify Avid's current stock price. I am impressed with its business model and I'm convinced business will improve going forward. However, I am not impressed with eps projections and have learned that the 5% - 5 year growth rate (shown in Yahoo's "research" tab) is geniune. This is the expected average growth, after smoothing out statistical quirks.
52 cents per share for 2003 is unacceptable and 2004 and beyond just too risky to bet on at this juncture.
Quite honestly, Avid has never delivered any earnings worth noting and they've been in business too long to ignore this this basic fact.
I'm leaning short, but not yet commited.
Just my opinion, right or wrong.
Simple, use the most basic accounting document that exist...the balance sheet. The balance sheet is in far better shape than it was last year...and yes some of that is because of the ammoritization of SI but that has been an anchor on this company since they made that ridiculous aquisition and it is over with now.
The turn around is in three key places:
Expenseces are under control
New BIG Bcst business is rolling in weekly
Digi is doing great business w/ Pro-tools HD
I am looking at EPS and actual earnings and I believe that this company is on the verge of taking off in a big way. i am not trying to convert anyone, just explaining why I am so pumped about Avid. I was saying the same things at 14,15,16,17,18.etc.
Take a look at what the price target is for Avid
Just because a stock is overheated and JPM downs it for buy to neutral does not mean the company is doomed, (the fact that JPM even knows Avid exist is amazing), just that it is where it should be for now.
Talk to me on Feb 3'rd and we will see which way this goes. I do agree with sugarr on one thing..it will not do much from here till news
How can this be a true turnaround? You were fooled like the rest of the street. The year-ago lossses that they are comparing todays gains to were not real losses because they were the charges left over from the SoftImage acquisition. Extrapolate those numbers and you have a company that has lower revenue than 1 year ago.
If you are patient and willing to wait, Avid might come back, not on fundamentals, but becaus of renewed momentum. In the meantime, to make money, or not lose it, you will have to be very patient and lurk for perhaps months.
There are scared longs here, right now, who believe this will all be over soon - a week at most - and so will "hold" as the carnage unfolds. Unfortunately, they had better be prepared to hold for months, not days or weeks, and live with massive unrealized losses as they sit trembling in the peanut gallery.
Soon we'll all learn that insiders were selling all they could, under the law, while Rome was burning.
I did notice the after hour trades but over 75% of the trades, including two big blocks, went for under 22. In fact they went out low, which means to me they sold at the low bid in an effort to get out. If they were buying, the big volume would have to meet the ask and pay up.
By the end of next week we will all know for sure.
In this business, squeezing people out of their positions is routine. Today, the odds are that Avid will move down to levels the scared longs never dreamed possible. On the way down, they will double up on margin hoping to recover losses. They might even double again later on as the stock continues to decline. But, the decent never stops and eventually, these scared investors capitulate - tossing in the towel; losing their life savings.
Margin calls galore.
This has played out so many times before with so many stocks before it isn't funny.
Unless Avid's streets are paved with gold, it will happen again.
Happy New Year.
Down 6% aint to shabby given the volume and news.
Now, watch this play out:
-Give and take for the next 2 weeks around 22-22.5
- Q4 earnings announcement back to 23-24
- Run up to NAB 25+
-Q1 earnings (if great) 30
The reason this has leveled and turned (sugarr I am sure you saw that better than 100K have traded after hours at 22+) is because people are realizing that these downgrade are luke warm at best. Buy to neutral is not the sky falling and either should the stock price. They are essentially putting the price target at what it is now ...22. The thing that can change that is earnings and positive guidance on earnings release. We will wait and watch cuz I am long on this one.
This company is not a bag of air..it is a true turn-around in a bad economy and
What is cool about the market is that you have a strong opinion and I think you are totally wrong. This company is well positioned for growth. I have owned it since $11 and will add if it falls too far, which I don't believe it will.
good luck to you
If you're right about margin, and you probably are, the "fools" will get margin calls next week resulting in a new wave of blood.
It's dog-eat-dog, and I'll bet JPM has lots of customers on margin with Avid. They cash in, management with options who have been selling recently cash in, shorts cash in,........Everyone wins but the numskulls.....it's Darwin's theory - Natural Selection - God wants it this way.
And don't forget those Margined fools who thought this was 'going to da moon, baby'. They will buy on the dips as they have been conditioned to...this will prob. see a brief bounce, and then the MoMo Big Boyz (chasing high beta) all running for the door will crush them on the way down.
Double volume ain't Uncle John selling...
PS. everyting is ALREADY priced into AVID
Yes, everyone who bought Avid since December 19th is now underwater. All in just minutes.
Now, the many, many momentum fools are holding on hoping for the bounce that will never come.
By the end of the month, with Avid in the mid to low teens, these bagholders will capitulate, driving Avid into single digits. At that point, virtually every investor will be underwater.
You are not dreaming. This has happened over and over.
As the great philosopher, and ex-yankee great Yogi Berra once said, "It's deja vu all over again".
With 2 downgrades and 2-3 X normal trading a 8% loss is not bad. 12 trading days?? This thing has been running since November and is up 35% and that is my point. The shorts here think this is going to $5...and it dont look like thats gonna happen. The next news should be earnings and if they are as good as it sounds like they will be...I think Avid will be into the mid-twenties or better.