When I say that the company has cut guidance twice, I am referring to their early announcements that Q4 and now Q1 would come up light versus previous expectations. What is to say that won't continue for Q2 and Q3, putting increased pressure on Q4 to make up the difference.
It could very well be a stop along the way to $105 if we move to test the range around the 200 averages. The 100's are just shy of $112. Currently, the Williams %R is oversold, and the RSI is oversold. The MACD, however, has only just crossed below the trend line. On previous sell offs, when the lines cross they usually continue downward until the move bottoms around a moving average. I would venture that if we do not get a significant move higher that also pulls the MACD back to projecting upward trajection, we could very easily continue down to the lower averages.
The fundamentals would support a case for a lower price as well. UTX came out and reaffirmed 2014 guidance, with an expected hit to Q1. Now, based on the short-term guidance for 2014, we are looking at somewhere between 5-6% EPS growth off of 2013. You have a stock trading at roughly 17-18x earnings with 5-6% short-term growth that has now TWICE cut guidance. I do not see a justification for that high of a multiple until the company proves that this is a minor hiccup as global economics are shifting due to China demand (where UTX has huge business opportunities for Otis and Carrier, etc.). If 2014 guidance holds, and we trade down to the $105 level, you have a stock trading at roughly 16x (105 divided by the 6.55 low end estimate for the year). I am more comfortable with 16 and below than I am with 17-18x. A P/E of 16 takes out great deal of premium for perfect execution. When compared to other industrial names operating in similar fields (Honeywell), UTX does not have growth high enough to support a premium multiple AT THIS TIME. If, however, management gets ahead of these headwinds and is able to boost sales, and thus the bottom line, and build future growth expectations, then a return to 17-18 would be not only justifiable but warranted.
Keep your core position. Trade around that with options to raise capital to buy more stock on the deep dips. Solid company, but the stock is high.
Let's see... buy 2250 shares at 1.56, then sell at 2.20.... back out the $10 for transaction cost... and you get... hmmm.... 40%!
I can do math quite well.
Will redeploy after the gaps are closed and make that same money over a second time while your sitting on your hands watching the red and green bounce around on your screen.
Okay, so I guess I'm bashing... I guess that's why I sold 2250 of my shares today for a 40% gain.. Hmm... I'll go "think about what I've done".
Etrade lets you. When you put in your order there is a spot where you can select whether it is for the current day, good for 60 days, fill or kill, or pre/post market hours.
I mean, they use electric furnaces in aluminum production and some steel operations. Why couldn't they transfer that technology to oil sands processing-- especially when they can do it at high rates of efficiency with such an abundant waste product. Instead of simply exporting natural gas, convert it to electricity and export the value added energy source.
I wonder what the feasibility would be for N.D. to push a movement through that would have all of the currently flared gas run through on-site turbines that could be transferred into a regional power grid and then exported into Canada. Have the Canadians then work on figuring a way to convert their oil sands operations to using electricity to run their processes instead of natural gas. It would solve the problem of flared gas in N.D., get the Greens off the backs of the oil sands companies, and add yet one more exportable commodity to the list for the U.S.
They could start with small turbines to cut out the flaring and them work their way up to larger collection/generation/systems down the road with the money they make off the electricity sales to the state and what is saved through the electrification of drilling equipment vs. diesel fuel costs (drills/pumps/etc.).
Hey, I added 1,000 shares today with the pullback. It is my speculative name and is currently about 3.5% of my one account, and roughly .9% of my overall holdings. I'm not adding more until the rest of my positions increase in value and dilute this position to well below 3% of the account.
I'm still figuring one 1 full year before profitability, and maybe 1 cent per share at that point. If they break over into profitability sooner- great. A quarter after that, I can deal with that too. But I'm not expecting the multi-dollar move being hoped for by others on this board. I don't invest in hope. I'm here to invest in a technology that fits well with one of the investing tailwinds I see across the global economy- namely a combination of a desire to squeeze increased value from all costs. Customers can squeeze more value out of their energy costs by implementing this type of technology through added outputs of energy and services (heat/cooling). Plain and simple. I don't see these being added to trucks because trucks will not electrify en masse. They will switch to fuel sources that allow for cost dilution, i.e, CNG/LNG/Propane and mixes of the aforementioned with biodiesel and the like. These not only reduce fuel costs but also maintenance costs through reduced wear on engine components.
This is not a miracle company. This is purely a company that has a product that fits the needs of a growing customer base and that has significant future potential for sales along with improving internal metrics that will translate those sales to profits at a faster pace.
Rolling over. Look at the charts. My guess is $112 target. Buy puts to trade the downside. Lock in the profits and use it to buy calls for the return trip. Don't sell your shares-- use options to trade around the moves to raise capital you can then plow back into your core holding for the name.
Yeah, but two new gaps are now open. 3/10 open, from $1.80 to $1.90. Today's open, from about $1.95 to the current market level, which has closed the gap roughly half way with the decline from the high earlier this afternoon.
My guess is a retrace to $1.80 to close that gap.
Ummm... what do you call the rocket 20% move from $2 to $2.40 today then? I'm pretty sure we have seen a significant part of the short squeeze already.
The stock has already outrun the fundamentals. There is not justification for this P/E other than a move to put the stock in-line with other names from the rail industry and similar manufacturing company stocks. Even if this were warranted, the move came far too quickly and now that the momentum has broken, a number of people have likely pressed the sell button to lock in an astounding 40%+ move in less than two weeks (potentially 1000%+ return if you played this name through stock options from before earnings!). Because the trend has broken, I believe it likely that technicians and technical traders will move into this name. We are very close to breaking through the downside on the MACD line. The RSI is well within overbought territory. The Williams %R indicator is also within overbought territory. The RSI and Williams are both trending downward while the MACD is trending downward.
The moving averages are quickly coming within striking distance, especially considering daily 3%+ swings. The 20DMA and 20EMA are are roughly $65, with the 50 averages around the mid-$50's range. With today's sharp spike down, we effectively closed one of the major gap ups left from the near parabolic move higher ( I say "near parabolic" because the angle of incline on this stock is far too sharp to be considered a standard parabola, but as we have seen the sell-off following the apex comes just as quickly in the opposite direction.
Likely course? Either we bottomed out at the low today, closing that gap, and then bounced, leaving the stock to trade roughly sideways over the next week or so while the technicals ease lower without further sell-offs. Or, we are still within the trading range on the downside and will continue to sell-off moving forward. You can see this range pretty clearly on a 5 day chart. Draw a line connecting the spike downs of 3/6,3/7 and 3/10. All three are bouncing of the same line. I think that gives you a direction and a series of targets to use.
Not as much as I thought it was going to be, but still demonstrating downward trend. You can make out the average line of incline and decline on the 5 day chart-- good deal of control in the up and down to either side of the inflection point at the 3/6 high. That overshoot was offset by the initial overshoot to the downside shortly after the open today, which righted itself and biding time until the midday move down begin.