Being a long time holder of PRFT, my thinking is that the analyst has created an opportunity here. PRFT has had wild swings in the past (as around the second week of August) and has always come back strong. The fundamentals that made PRFT a great stock in the past haven't changed, so I believe the analyst has created a great entry point, or an opportunity to add to your position. I recently took the same approach with AKAM.
It is dangerous to think history will repeat itself in a simple form without concrete facts to support your thoughts. Have you thought about what if? What if it keeps dropping from here? What if the market gets another correction due to the dash of high expectation that Fed will cut again in Oct? What if the earning guidance is disappointing? What if the earning shows major slow down in organic growth? What if the Q4 estimate much lower than the expectation?
The analyst made a very good point yesterday. All he did was pointing out the organic growth is slowing and not enough acquisitions and traditionally Q4 is the worse quater for consulting firms.
The analyst you like to quote here is saying that he likes $22 for this stock. Why then are you putting your sentiment as strong sell when the stock is well under that number. Well, I will answer for you - you are a parasite short that shows up on any board when a stock moves lower for whatever reason.
I think you should be Long. But to answer your questions, I've already made a lot of money being a PRFT shareholder by taking profits over time. What I still have on the table is a little of what I don't need, so even if your scenario is correct, I'll either just move on or wait it out as a long term investor.
No, I expect it to exceed the $22 the analyst put out as that was just a manipulation of the stock price. As I said yesterday this is a common manipulation that carries little weight in the long or short term. The example I gave was SIMG. Goldman Sachs tried to push that stock price to the low $4's from the the middle $5's a few days ago with a similar analysis. The stock is trading today at 6.34
i believe it will too, but all I am saying is, it is not cheap to buy it now. It will go under $20 today and under $18 after they annouce the Q4 estimate. Buy it then, don't fight the trend.
If I took that advice with SIMG I would not be as well off in that stock as I am now. You are pretty greedy if you are not satisfied with a drop from $24.50 to $20.00 on a suspicious analyst estimate, which itself says the stock should be $22 right now. Shorts are overly greedy in this market I have found. This stock will move back to its original state rapidly. If you are going to cover now would be a good time.