Back to Stocks.
My speculative bottom fishing is NOK. I haven't seen a stock getting hammered like this, from $11.50 to $8.84, over an executive decision. When you think about it, most of the fast stock drops are due to bad earnings or guidance, rarely caused by some planned corporate strategy. Former MSFT Apps exec Stephen Elop, with no wireless expertise, is now being widely panned as having delivered NOK to a sinking MSFT, instead of choosing the superior Android. A CEO is brought into enhance shareholder value, not to wipeout 20+% of market cap in two days by making such bad strategic choices. I suspect his days are numbered, and the board should hang him out to dry, if they are truly there to protect shareholders. The stock should jump back to previous levels if/when they dump him and undo the Windows Phone deal. I don't like much anything else about NOK in terms of fundamentals or market positioning of smart phones. But I think the soon to be dumped Elop may be the best thing about this stock!
posted by Junk Bonds @ 2/14/2011 04:44:00 PM
5 Comments:
Doesn't sound too speculative if it's already dropped 20%. I like your hunch here, but this is something that needs to be acted on soon. Where would you propose we can raise the $? Selling COW or RY or gold?
I would vote RY off the island; just feel gold and Ags have some more upside. BTW, I think there will be some time to buy NOK, no need to rush in. These european boards are a little slow to react, with their ski vacations and long lunches. Besides, they would effectively be admitting their mistake for hiring Elop, so they may need some fund managers to pressure them. I'd like to see some bottom rather than catch a falling knife. (how's that for packing in all the useless trading euphemisms in one comment!)
Earnings season for the Cdn banks starts Feb 24th so if you think time is not an issue then we can hope for some positive earnings surprises. Royal bank has lagged the others so it is due for some catch up but the way analysts are in with management, hard to say if the price is already baked in!
Also could NOK have just suffered a multiples reset? I know the 20% drop was rather sudden on no earnings surprises, but was it trading at nosebleed levels and just happened to walk into a negative catalyst?
I don't know about nosebleed multiples but the market was hoping for some cleaver insight from the new hot shot Elop, instead he laid an egg.
I think I saw RY earnings on tap for Mar 1. not sure we can wait that long, but I'll keep an eye on NOK news to see if there is some chatter along my thoughts.
I see NOK is hitting new lows today after some early bottom fishers propped it up last week. (I have a lot of practice studying dropping tech stocks :). Meanwhile RY has been trending up nicely past few days in anticipation of earnings. If you believe the "buy on rumour, sell on news" idiom, then later this week could be good timing to get out of RY before Mar 1, and get into NOK for a few weeks.
Also, I see OIH is up due to Arab unrest. Is that a better option than NOK?
Post a Comment
Subscribe to Post Comments [Atom]
<< Home