heylo fouks.....
found this link when i googled for something else... sheer luck...
the original site is hardspell.com
now... don't stone me to death just yet... but increased competition is indeed good news... whether you are an Intel fan or of AMD
http://nl.babelfish.yahoo.com/transl...TrUrl=Vertalen
Regardless of market direction, regardless of the economy, there are a few companies out there that are already the walking dead. They can’t compete, or they’ve suffered from years of poor management, or their expenses have spiraled out of control due to rising cost of inputs, or they are just in the wrong business at the wrong time.
Even Buffett has said that the best management team in the world can’t save a business in a poor industry. He found this out all too well when he bought a struggling textile mill and failed to turn it around: Berkshire Hathaway. Ultimately, he gave up on the mill and stuck to insurance.
Hedge funds know all too clearly which stocks are going down the drain. When a stock is heavily shorted, there is only one reason: Hedge funds are gunning for it. They’ve done the research, they’ve spied on the CEOs and CFOs. They’ve rifled through the garbage cans in the company parking lot. They’ve pretended to b janitors while poking through the papers scattered on the COO's desk.
So here are the things we found in the three stocks below that are going to zero:
- Heavy short interest
- Declining revenues and margins
- A competitor that has become the industry leader by a wide margin
- Factors distracting management
- Heavy debt load so the company will not be able to tread water without restructuring itself and crushing shareholders
- Consistently missed analyst estimates
- Very few quality hedge funds as shareholders
Note: A high P/E ratio is not reason to short. Just because Baidu (BIDU) or Apple (AAPL) has a 100 times P/E doesn’t mean it’s a short. Once it's overvalued, if it continues to grow, it could easily grow even more overvalued. What you need to look for are the companies whose business is fundamentally flawed.
Advanced Micro Devices (AMD): Last week, AMD posted $1.35 billion in revenues, a sequential quarter-over-quarter decline of 10%, and it guided down for next quarter. Despite enormous technical creativity, AMD simply does not have the resources to compete with Intel (INTC). The myth of a duopoly in the chip space is over, and Intel is the winner.
AMD just replaced its long-time CEO, and it is trying to sell of two fab facilities in order to raise cash, despite raising $600 million just last November. Meanwhile, Intel is sitting on over $11 billion in net cash vs. AMD’s $3.5 billion in net debt. Intel can throw cash at any technical or competitive issue, while AMD is dealing with management turmoil, continued troubles integrating its acquisition of ATI Technologies, and cash management issues.
NEW YORK (Associated Press) - Fitch Ratings on Friday affirmed its "B-" issuer default rating on chip maker Advanced Micro Devices Inc. with a "negative" outlook.
A "B-" rating is non-investment grade, also known as "junk."
Fitch said the ratings and outlook continue to reflects its expectations that AMD's operating performance will "remain relatively weak over the near term, despite recent new product introductions."
NEW YORK (Associated Press) - Moody's Investor Service lowered corporate family ratings for chip maker Advanced Micro Devices Inc., citing ongoing operating losses and a competitive market that includes a bigger rival, Intel Corp.
Moody's said Monday it downgraded the ratings to "B2" from "B1." It also revised the rating on a $390 million senior note due in 2012 to "B3" from "B2" and said the outlook is negative.
The service said in a note its negative rating outlook reflects the company's "challenges to move its operating performance towards a level of self-funding profitability and then to sustain that momentum."
Moody's said it believes Advanced Micro "will remain challenged to internally fund the advancement of its process capability and production capacity, which is essential to keep pace with competitor manufacturing cost reduction and process node advances."
Moody's also cited risks inherent to "the volatile and capital intensive microprocessor segment of the semiconductor industry."
*tranqs the wingding and transports back to his cage*
nothing to see here folks.