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Bob wrote:
<The price has been cut in half in the last 4-5 months (similar to
3com), today was another gasp down. Both are heavily traded NASDAQ
stocks. If earnings will be nearly $3 in 1998 then this seems like it
could rebound to $50 soon. Any thoughts?>
BOB: Maybe, perhaps. But the big factor is Fear and Loathing. ASND has
lost all credibility with analysts and portfolio managers. For the time
being, they are "snakebit". ASND has the habit of repeatedly introducing
the street to "Ms Rosy Scenario". Time and again, Rosy always turned out
to be a tramp. Earnings for the quarter were trashed (again). Other than
that, the entire group is weak. Even CSCO, the bellweather of the group,
is very weak. After earnings estimates turn out to be overstated , ASND
has a habit of making "plausible excuses" for poor performance. Their
guidance to analysts has been poor, to say the least. After a street
analyst gets burned twice or even three times he, she, or it looks
elsewhere for ideas.
From a technical standpoint, it has looked horrible since February. Even
a relatively uncomplicated set of indicaters from Worden 2000 pointed to
heavy distribution and unforseen problems. You have a choice: Take the
sick dog to the vet's and wait for it to be nursed back to health, or just
shoot it. At these levels, we might even see a "dead dog" bounce, who knows?
Cramer, who is a manager of a hedge fund and writes columns in
www.thestreet.com had an amusing article on ASND recently. After being
burned repeatedly in ASND trading, he publicly "took the pledge" and swore
off playing with ASND permanently (he says).
I also swore off ASND for the time being, but look at it and the
technicals every day with lurid fascination. It's like looking at a
swaying cobra. Someday I might try to bite it before it bites me. Be
careful. It's tough to pick a bottom on a despised stock that is in a
free-fall!
Good trading,
Nick
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