Summary of irrelevant SMTX "red herrings" raised today I have never seen so many irrelevant points raised on a stock:
1) SMTX non taxable.
Totally irrelevant- SMTX will remain non taxable for years with its huge loss carry forwards.
2) SMTX inventory is building up.
The SMTX inventory build up was required to meet surging demand, not as a result of slowing demand.
3) SMTX should have a low PE.
The Industry average PE is over 20. Even if SMTX warrants a single digit PE of 9, it should be $4 based on forward earnings.
4) The Industry is slowing down
Both SMTX and CLS CEO's said the rest of the year will show dramatic earnings and sales increases.. SMTX said a dramastic upturn started in early 2006.
5) SMTX has large debt SMTX debt small compared to most EMS players..the increase in debt is a GOOD thing it was needed to finance inventory for surging demand.
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