That wouldn't be so bad. This company is so up to its gills in cash, if the stock dropped it would be a golden oppportunity for the company to scarf down some cheap shares and then the long-term upside would be huge.
If GTAT's remaining hope is the claim that their contract is unenforceable because they were idiots to sign it then that is pretty thin soup to hang your hopes on.
Their quarterly looked decent, aside from the GTAT quagmire. I like these guys' business. As far as I can ascertain these guys make stuff that is essential to leading-edge semiconductor manufacturing, but not stuff that individual equipment makers are going to want to develop in-house.
The conference call certainly seemed to indicate that- vendors are going toward more outsourcing rather than less. It makes sense. Vendors are going to want to put their R&D into the proprietary technologies that they have that differentiate their products from those of their competitors.
As a value investor, I am a borderline buy on this one at this point. If it's down 7% tomorrow like it is after hours I may start buying some shares.
I like the fact that they have a decent balance sheet. Companies in the semi eqt business you always hope to see with balance sheets built like a tank considering the severe cycles that semi eqt goes through. These guys don't have that, but they do have some net cash and the semi eqt cycle is supposed to be entering an upswing.
Another good thing about going to the bank is that those tellers are awfully lonely. You go into any local bank and there tend to be about three tellers that look bored to tears and all pounce on you at once to be the one to have the opportunity to relieve their boredom by doing a transaction for a customer.
How in this day of age of relentless cost cutting in the business world can banks have people sitting around doing nothing all day? I think the answer is that banking is not a real business.
These guys look cheap on PE ratio. But I guess it's concerns about earnings that led to today's drop?
Based on enterprise value to gross profits ratio of almost 6, they do not look cheap. Even if they maintained a single digit PE ratio, not sure what the significance would be. It would take many years of earnings to pay off their debt. There are tech companies out there with tons of net cash relative to market cap.
I really don't see why anyone would want to invest in this company.
This will teach Buffett to not invest in businesses he does not understand.
Since ALU is a weak player in the markets it serves, if its competitors are sounding sour notes you can expect business is not very good for ALU.
Could you provide some metrics that lead you to the conclusion that they got it cheap? It sounds darn expensive to me.
I guess all the dilution took place during today's trading of SWN stock, so the dilution is now baked into the cake.
RE: "Apple holds first lien on those furnaces." - contrarian2001
Do they, really? Only on paper.
So GTAT can round up some armed vigilantes to protect the furnaces from being foreclosed by the county Sheriff?
AAPL did not trust GTAT. They made a deal where they knew they could simply euthanize GTAT if things didn't work out.