THE MARKET In general the indexes continue to look very much like consolidations in a downtrend, with another leg down yet to come. A technical relief rally is not far away ,but be careful....its sustainability is doubtful. The technicals and chart patterns have broken down, with double and triple tops in place now, and the indices will be very hard-pressed to reverse the bearish chart patterns. Friday was another volatile day with markets closing near there lows for the day.... What's worse is the selloff accelerated in the last hour and a ½ in the day. This does not bode well for the sustainability of ant short term rallies. NASDAQ volume was over 1.6 billion with more than a 3 to 1 ratio on the negative side. The NASDAQ has resistance at 1962-1970 and 1985-1991, and support is 1928, 1913-1920 and 1887. If we can hold the important short-term support levels then we may have a chance of working our way out of the woods ... albeit with a heavy ax....But if the market breaks support we will be due for a continuation of this weakness most likely into the 1800s as I have indicated before...So...without a breakout above resistance the trend is still down. The Dow looks like a bear flag, and a move down Monday would break it. Resistance is 10,250 and 10,330-10,375, and support is 10,128, 10,092 and 9900-10,000. The S&P was turned back once again at the major resistance level of 1126. First resistance is 1113, and support is 1102-1105, 1096 and 1075-1082. Attention focused on Pakistan in hopes that Osama bin Laden's number-two man might be captured, but the news never came. A bomb threat in Washington D.C. schools turned out to be a nonevent, but did set a negative backdrop early in the session. High gasoline prices also continue to be a concern. For the week, the Dow fell 53 points, or 0.5%. The S&P 500 dropped 10 points, or 1%. The NASDAQ was down 44 points, or 2.2%. Keep your eyes on mutual fund flows....watch to see if this weeks recent outflows reverse. If inflows snap back we could get a nice technical rally, but if they do not, or if the volume increases on down days, then we could see a much larger decline in late March/April.
EXCERPT NOTED IN MY POST Date: 3/16/2004 Momentum has shifted to the downside for now. Recent breakdown levels are expected to now act as barriers to a sustainable short-term recovery. I continue to find most equity averages well entrenched within an intermediate corrective process. I believe the Dow may very well drop below the magical 10,000 a strong psychological support....the NASDAQ has already broken its magical psychological support of 2000 Investors Hub - InterDigital Communications (IDCC)Post #62960
IDCC IDCC is currently traveling the post earnings/conference call carnage cycle.
LETS REVIEW... ISSUES: Earnings,analyst expectations+downgrades /upgrades, expenses, licensees, litigation/arbitration, relevant market conditions+ a bit of TA Revenues in the last quarter declined, expenses increased, analyst expectations were whacked. Forward looking statements included continued higher expenses, uncertainty in licensing, and Nokia arbitration delayed till next year. Merritt was conspicuously absent[ok] and Goldberg smoothed over the licensing predicament with generalized comments of being in the 'economic phase' of negotiations with perspective licensees...
LICENSEES.....excerpts from posters "Without a doubt that's correct. They gave Merritt a little wiggle room to bring in Lucent and he fell on his face. IMO Goldberg did much better running the licensing program."
"Think they knew they were going to miss and were hoping a new licensee would cover their @$$es...."
A QUIET LONG POSTS sonic22 RE licensees Still waiting for one major player to sign for 3G and than I think the teens could be history for good. I'll take numerous companies like Sierra signing up but I think we have to be realistic, Sierra will contribute only 1-3 cents this year, not enough to bring us back in the 20's. A few more sign and than we'll be back to where we were before the CC. Investors Hub - InterDigital Communications (IDCC)Post #63230 Can you hear me now/? Can you hear me now/? Can you hear me now/?
LITIGATION/ARBITRATION 'If they can explain the delay in the Nokia arbitration that makes sense we will recover somewhat. If the analysts don't swallow it we wont.' JimLur
Looks like the big boys are waiting for resolution...or worse... FROM ONE OF OUR MORE OUTSPOKEN LONGS Surely if each company is interdependent on each other then it is commercially unwise for any of the trigger company's to bother paying. The only way would be for IDCC to enter into long term costly litigation against one of these giants. Investors Hub - InterDigital Communications (IDCC)Post #63480
CONSPIRACY THEORY some of the big boys got together and figured out that they could wear down little ole KOP UNTIL.... 1].they litigate themselves to death...... 2].its analysts downgrade it into obscurity and 3].its loyal long investors pass away....[ overstated] At BEST IDCC would capitulate as they did with ericy settlement for a pennies on the dollar or worse they would war till the last dollar was depleted from their coffers...[thatS from me... just a thought a bit out there... ]
ANALYST EXPECTATIONS
DOWNGRADES/UPGRADES Zacks Sell List Highlights: InterDigital Communications 3/16/04 IDCC intraday high 18.19
Zacks.com . Zacks Rank #5 (Strong Sell). ... InterDigital While the rest of Wall Street continued to tout stocks during the market declines of the last few years, we were telling our customers which stocks to sell in order to save themselves the misery of unrelenting losses. Among the #5 ranked stocks today we highlight the following companies: InterDigital Communications PCQuote / Empowering the Individual Investor
---Most analyst downgraded to neutral one upgraded to buy.--
MARKET CONDITIONS + TIMING RELEVANT TO IDCC...
ARTICLE.... InterDigital Gets Dinged March 11, 2004 Basically, IDCC's stock became a victim of early success and subsequent bad timing. The company successfully negotiated a windfall license agreement with Ericsson (NASDAQ: ERICY) back in March 2003. It hoped to capitalize on the agreement and quickly ink similar deals with major wireless equipment manufacturers. Rather than accept the terms of the Ericsson license, however, Nokia (NYSE: NOK) and Samsung instead chose to enter arbitration to resolve fee disputes.
The more speculative stocks are out of favor and on a technical and fundamental basis and they may fall more in the near future.
EXCERPT NOTED IN MY POST Date: 3/16/2004 The Dow, NYSE Composite and S&P 500 have held up much better than the NASDAQ, as there has been selling of speculative stocks and a flight to quality. Distribution + SECTOR rotation is in process...A MOVE TO THE BIG CAPS //////////THE BETA FACTOR Definition -- Beta The measure of a stocks risk relative to the market.
I think what most of us forgot, or were either unaware of, Is that IDCC has a high Beta value of 5.4. Thus price movements up or down are much more volatile than the market. In the current down market, and with the recently announced "bad" news, IDCC's price action may be understandable. Maybe some of our TA types can explain it better. Investors Hub - InterDigital Communications (IDCC)Post #63435 "understandable"....BUT NOT LIKABLE ... your observation is correct....... IDCC NOT FOR THE LIGHT HEARTED OR THE WEAK OF STOMACH
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TECHNICALLY ...
EXCERPT NOTED IN MY POST Date: 3/16/2004 ......... INTRADAY HIGH. 18.19..........
We have broken below all of our recent pre earnings support levels, below the Forbes article lows, and are now back to the October of last year when we closed at 16.99 [as we were coming into earnings]. At that time we were trying to recover from the Nokia arbitration debacle...which took us down to an intraday low of 13.90 in August [naz in the 1700's]with market momentum well on is way to the upside...bulls in control. Now the market is in a corrective pattern and positive momentum is not there at this moment to support us.....at some point that should change but I am not certain that it will be with the same fervor as last year....we will have to wait and see.
EXCERPT NOTED IN MY POST Date: 3/16/2004 Yes, we are oversoldbut that does not mean we will make a speedy recovery... Unfortunately Institutions are in on this sell off and we have nothing to replace them with at this moment. At the point that we get significant licensees and our earnings are up not down we will recover. We have the goods....just missing enough paying customers. In the near term ... short relief rallies may lead way to lower prices I will be looking to add to my position as the bottom becomes clear ... At the end ... when all is done...we will prevail http://www.investorshub.com/boards/read_msg.asp?message_id=2615935
As always your thoughts and comments are appreciated..ALLEY
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