Well, it is not hard to list the possible reasons. The key is knowing which ones were in play to take this down.
1. More sellers than buyers.............obvious but the question is why the sellers at these activty levels?
2. Various shareholders getting advance news about earnings and want out. Doubtful as this is illegal and doesn't happen as much as people think.
3. Shareholders have good gains and just want out before earnings to protect gains at the cost of losing further gains. Can be smart but the seller then has to decide where to invest their proceeds and I think HIMX is as good or better investment here than anywhere.
4. Traders wanting to 'shake the tree' and sell off some shares to take this down and create some fear and selling so they can buy more shares at a lower price. They know they have to do this before earnings on 7-Feb because then we will have many more details and proof of the company's business and outlook. Keep in mind that the daily shares traded has more than doubled since November and HIMX just went on a road show.............and touted their 4Q outlook so I think they will hit it otherwise why state it to investors when they know they will miss? That is like going out to degrade your company rather than promote it.
5. Normal profit taking but almost by definition it can't be normal when it causes these sorts of drops.
I tend to think it is primarily #4 as this dropped early meaing someone put a bunch of share out for sale early in the day to take out the various sell stops (this also decreases the number of shares they have to sell to drop it). It hit the lows within an hour of the open and then just churned and even went up $0.07 from the early lows to the close where this trader scooped up whatever shares were available.
So, this was sold off to get some trading volume but there was no follow through on the selling as the price stablized within an hour and then closed higher.
I am sitting on big gains and 125,000 shares and thus am a bit wary of buying more at these prices since my cost basis is over $1 lower. But, this is still the single best stock I have found and would prefer to buy more HIMX at this price than anything else I have found. What else looks as good as HIMX even at $3?
I may even buy more although it that dishonors my diversification standards and I hate raising my cost basis.
But, I will say that their recent presentations at Investor's conferences were positive and why would they do this is the business was suffering and they were not confident of hitting their outlook? That would be like taking off your hat and calling attention to your own bad haircut!!!!! You don't go out and make commitments you know you can't make.
So, if this continues to drop, I may be a buyer...............but I will not be scared into selling with earnings coming up as HIMX is a very solid and profitable company..............in a great growth industry!!!!
With the volume double the average daily and the pps pushing down and the end of the month to boot, leads me to believe it is profit taking. Also tech is taking a hit today which may be scaring some to sell too. I do think it is a bit overblown and panic is setting in a bit with traders uneasy about what earnings may look like since a lot of companies have been blaming Sandy for lower revenue. To me HIMX is more about the world then just the US. Now how the currency trade effects the company may be a reason too, just not sure on how much. Even though LED prices have come down it really should not effect HIMX too much IMHO, but we should know with the earnings announcement. Bottom line I am Holding, I do think we had a good run up and to back off a bit and then continue the move up if earnings are good we could see $4 in the next few months. All JMHO.