I know that predicting stock prices is near impossible. However, if analysts had guessed earnings of 0.16 everyone would be estatic today even though earnings would still be 0.18.
For a stock selling at $16, earnings of .18 is still very good compared to rest of market. Seems to me this stock is still undervalued. There are so many stocks out there with negative earnings per share, less stable business models etc. selling for so much more.
Askindoc... I am really curious... how is this stock overvalued?
It currently has a price/earnings ratios of 23 (which is undervalued), and if the price were to stay at 16.50 throughout 2004, it will have a P/E of less than 16 (which is extremely undervalued) because earnings are growing.
Samuel, you're right on that this is a highly undervalued stock, and is a fantastic buy right now.
All stocks have growing pains. This stock traded under $5 a year ago, and hasn't traded above $8 for over a decade. That's some pent up selling pressure, and I'm sure many ultra longs felt it was time to pull the trigger. Add that to the fact that many short-term trades who got in recently were probably stopped-out when the stock opened at 16.80 yesterday.
But, it's a whole new stock and company now. They're highly profitable and growing at text-book bullish rates. Institutions are accumulating, and stock trading volume is many times what it used to be.
This stock is on the right track, it just needs to work out the kinks naturally.