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Diamond Foods, Inc. (DMND) Message Board

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  • jrgorel jrgorel Dec 29, 2011 6:43 PM Flag

    Best way to play diamond foods

    So why is it at 31 dollars. Ppl said same thing about Netflix and green mountain. I am not saying you are wrong just trying to find the best way to play this.

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    • it is at $31 due to the following risks

      1) unfavorable findings in the audit investigation
      2) Pringles transaction being further delayed or cancelled
      3) input cost volatility.

      The Analysts felt the stock would be capped at $65 if the investigation yielded an adverse result. The above risks are the reasons the price target was reduced to $65 last month. Panic and short selling drove the stock down to $26.

      Bottom Line: the fundamentals of DMND are strong!

    • NFLX stock was grossly overpriced compared to its actual profits. NFLX seemed to rise based on potential market share, not actual market share. When it didn't pan out, the price tanked. Plus, they made horrible business decisions and their Public Relations ability is a nightmare.

      Diamond is an old, established, consistent company. They make products that people eat. Period. You know what they make, you can see what they do, you can see the client base. It's just like Disney, Pepsi, Target, WalMart, etc. Been around forever, been doing the same thing consistently.

      Green Mountain got hammered because it missed earnings, and given it had risen too far too fast before earnings, that was just a catalyst for it to be worse than it likely should have been. Note with Green Mountain: Plenty of rumors and b.s. floated around saying they had accounting issues, but nothing has been proven and it's been 2-3 months now and we've heard nothing more of it. Hard to tell where GMCR's stock will go.

      Unlike NFLX and GMCR, Diamond's numbers supported its previous stock price. Nobody disagrees with that. Even if you say 96 was too high, well then you can't say 70 to 75 was.

      The fact they got this to 26 is a joke. Because of a suicide and an accounting question? Unreal.

 
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