Judging by some of the responses I have read since earnings were announced, I have noticed more than a few are disappointed that AMAT's management, while apparently good at turning a profit, but grieviously incompetent at earnings announcements. There is no way they couldn't have known the street was looking for $.27/sh next quarter. Yet rather than report a range which included $.27/sh, the idiots lowball the figure. What lunacy....! Is there some school of thought that says "If we down play the quarter and then have blow out earnings we'll look like geniuses....?" I don't expect nor would I want them to lie, but there are any number of folks who think the next quarter expectations were conservatively (a euphemism) reported by AMAT's management. What in hell is their motivation...? They own this stock too and it just doesn't make sense they wouldn't have enough grey matter to figure out the street's expectations and at least try and meet it if it was reasonable to do so. Personally if earnings do blow out the next quarter, shareholders ought to demand an accounting from management for their gross mishandling of this issue....that or sue the bastards!
I am so light I could float....in fact I may break the immutable laws of gravity...? Re AMAT'S management, they should have either offered no forward guidance or offered a true expectation. When I read several analysts, which I am no great fan of but they do move the market, say that they think AMAT "low balled" the earnings next quater, I get a tad ticked (an understatement)! Probably wouldn't have bothered me so much, but the rest of the sector went up on Wednesday's trading day. AMAT did not participate due to and I quote "less than expected forward guidance". As a "long" on this stock, I have every right to expect AMAT' management to offer forth a realistic assessment of their fourth quarter earnings. If in their heart of hearts they actually believe $.24-.26/sh, I'm good with that....but if they intentionally "low balled", which I believe they have history of, they oughta' go to jail 'cause they are costing folks a helluva lot of money...! But apart from that, God is in his heaven, my family has their health, and I still have my teeth. Life is good...!
the reason why they guide lower is because the stock will stay low and the company can buy more shares back in the open mkt. if they guided higher the stock would have been much higher (great for shareholders), and would have caused the company to spend more to buy back more shares. keep a low price and you can buy much more. next earnings i belive in my opinion. they beat the est. again and the stock will run. do your own research
Actually I have done so much "due diligence" on AMAT, I could qualify as a lay authority. That is what's so frustrating, there is no reason why a stock of this caliber should be trading at these valuations, except poor guidance by management and a willingness by the pundits to trash it. The slide started after NVLS reported in the previous quarter. The sector came under selling pressure because the analysts said the peak had come, and that the third and fourth quarters were "toast" for chip eqpt providers. AMAT came along with great earnings and vague guidance, and reinforced the belief. KLAC, et al continued in the same vein and the slide slid on, supposedly not to abate until '07. Of course the fact that the sector was still expanding didn't seemed to factor into the equation. When AMAT came out Tuesday and essentially gave the same type of vague guidance as per the last quarter, the stage was set for another stockholder screwing.....which normally I wouldn't mind if there was adequate foreplay. As for your read on Mgt's motives, it sounds plausible. I suppose when their window of opportunity comes around to inside sell, the trend will reverse until they get their fill.
It's a game they can't win....be conservative and people threaten a suit.....be aggressive and miss....same....hit the mark and manage the company through the flat spots, downs and hopefully the stock responds on the growth.
Again, no one expects them to mislead, or at least I don't. But I do expect them to accurately forecast a number based on infomation only they possess. When I read analyts say that they think AMAT is being conservative in their projections, I gotta' wonder why they are low balling ...? I don't believe anyone would have busted their hump if they had projected $.27/sh and missed. It's just not that far removed from what they did predict As a stockholder I have every right to expect them to support the stock price, if they can do so in good faith, and do what they can to cause it to go up. The rest of the sector seemed to do alright yesterday, yet the reasons given why AMAT didn't participate, was that they had forecast disappointing earnings for next quarter. Given the sorry state this stock price has been in since last quarter's earnings were reported, it would appear Applied would have been cognizant of how chary the market is re what they report concerning earnings. Yet they come in with essentially the same goofy abstract guidance they gave last time with the same attendant results. The street pundit wannabes jump all over that vague approach and broadcast to the world the sky is falling re AMAT. But to show I am a fair sort, I'll issue an apology to all concerned if next quarter comes in between less than or equal to .$24-.26/sh.....Personally I'm betting it's another blowout, but the damage will already be done re the price of the stock....!