a stock that has gone up 10 bucks a share in a few weeks will (short of some dismal news) go back down 10 bucks a crack in, let's say, a few weeks?With CECO's current scenario (current prices are NOT new to CECO, Analysts upping earnings, etc) statistically, the odds of that are on all are VERY low. Well, I still own a few PUTs for safety, but I do strongly believe they will expire worthless ....but the large number of CALLs (for me at least) I own, have already provided a nice profit ... and I will continue to hold them as long as things look "nice" for CECO.Also, if you are shorting this stock, it is NOT too late to "protect yourself" with some CALLs. It is not likely that CECO prices will stagnate now.IMHO
It�s all in the P/EThe industry P/E is 50For those of you who don�t know how to calculate P/E it�s (current share price divided buy the last four quarters per share earnings = P/E)Right now based on ttm earnings of .99 (12/02 - 9/03) CECO�s P/E is about 47 (47.15 / .99 = 47.6)(a slight discount to the group)after February 3 new ttm should be 1.14if there is no news good or bad there is no reason to think the P/E will change, this gives us a $54 stock ($54 / 1.14 = 47.3)If there is good news CECO could trade at a premium to the group as it was just a few months ago, say 53 that would give us a $61 stock ($61 / 1.14 = 53.5)If 4Q earnings are higher buy .02 adjust both of those prices up a buck.This gives us a range of $54 to $62 by the first week in February.The ONLY unknown factor is BAD news if they loose accreditation, more new accusations, Larson and friends dump a few million shares ect. then it�s anybody's guess.
"Mom, all my friends are doing it."
Movement on no news means movement on news we don't know. IMO.
I agree .... see my previous post for what I think about "The Verdicts" if interested.