Based on what? Casino gambling? The fundamentals don't support a move much higher than $55. They're not profitable, and their last ER report and guidance was disappointing.
It's insane to own a stock that trades less than 50,000 shares a day. There's no way to escape a huge fall like this, not even stop losses work.
When you consider the stock is up over 100% in 2014 alone, a 13% drop isn't a big deal. The exponential moving average (20ema) is at $84, so it's a reasonable move, considering the dilution and large sale.
Rah rah....cash on the sidelines.....the Fed has our back.....no bubbles anywhere.....Geopolitical events are buying opportunities......Record oil is great for everyone.....
He says it's a one drug story, and there are headwinds to deal with, and "we think the news is priced into the stock."
This is by no means a shoo in for approval. In fact, there are several headwinds pointed out by an analyst today in their downgrade. Some of the cheerleader analysts raised the price targets, but the guy at Wainwright did some serious due diligence, stating, "we have gathered significant scientific and competitive nuance that in many ways weakens the case for 809 becoming a steadfast cornerstone therapy in the next decade."
Simply put, there's a great deal of competition on the horizon. It's too early to establish a price point for the drug, and frankly I think the stock could drift back to the low $80's within a couple of weeks.
I think it's crash time for this market. This Fed doesn't know what she's doing, the economists have it all wrong, and the market is so far overvalued now it's insane....
The cheerleaders implication was based on the typical fair weather analyst, who provides little or no substantive argument in favor of their raising the price targets. On the other hand, the analyst who downgraded the stock provided a thesis that was supported by facts, not sentiment.
Of course this means we'll make new highs all week. But......Down volume is much higher than the up volume......That should tell you something.
This guy did his homework, and his thesis is compelling. This is nothing more than a casino market, which will be crashing very soon. SPLK is very overvalued, it's not even debatable.
There's absolutely no justification for pushing the shares up strictly based on momentum investing. The stock doesn't support this valuation at all, and the market is down over 100 points.....
The SEC will be looking into sell side analysts who write things like "after speaking with a number of Splunk's resellers and customers." That sounds like a violation of security laws to me, esp. if he gave this information to his own clients before releasing the note to the public. And the second half of fiscal 2015 is a long way off.
Why is it traders and investors are not allowed to call customers and others to do their own channel checks like the analysts? Clearly there's a conflict of interest. All of the analysts want to do investment banking business with public companies, that's a fact. So they'll raise the price targets of stocks, or lower a target if the company is struggling, but leave an "outperform" or buy rating on the stock.
Competing analysts' reports are misleading, contradictory with their competition (other analysts), and conflicted by their own agendas, which include the desire to do banking business, as well as getting their own personal wealthy clients into a stock, and then subsequently putting out a "note" that they've done channel checks and the "stock should recover", with price targets that don't match the fundamentals.
If this entire scenario sounds familiar, it should, because this is exactly what happened in 1999 and 2007 with companies that were not profitable, who were spending tons of capital on expenses, in an effort to capture revenues. There is no level playing field whatsoever, and just like 1999, this too will end badly.
For anyone who cares, no, I'm not short SPLK. It's very difficult to short a momentum stock in this market.....But as soon as I see a sell signal on the chart, this will be a great short opportunity.....That opportunity may come as soon as tomorrow, we'll see.
In the meantime, I believe what was written in the compelling article in Seeking Alpha yesterday, over what a Wedbush sell side analyst said in a note today.
I was waiting for a pullback to go long ISIS, and this may be it. Technically, the weekly chart looks like it could head back to about $30 within a couple of weeks, but this may accelerate the process. I'm waiting to read an article from someone knowledgeable with hands on biotech experience to offer a rebuttal for this article, and they we'll see.
34% upside in NFLX according to Goldman? That's about 150 points from here. And of course the self-fulfilling prophecy takes over right away, as the stock is already up $16 in pre-market. Never mind that the stock and the entire market is far ahead of where it should be with no correction in years.
No, I'm not short NFLX, shorting momentum stocks will come later...but when? NFLX could fall 150 points in one day in a black swan event....but no one cares, no one is hedged, it's 1999 all over again......and my point is the analysts are certainly a big part of the blame....