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MEMC Electronic: Glass Half Empty or Half Full? |
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| Jul 25, 2008 09:42 AM UTC |
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Tracked Blogger
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Via Long Investment Ideas from Seeking Alpha:
With MEMC Electronic (WFR) getting hammered yesterday on disappointing earnings (see conference call transcript), investors are faced with the always difficult assessment of what to do with the stock. I make no claim to deep expertise on WFR, but here are some general comments on the quarter, the valuation and the stock market reaction.
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Top line was about $10mm below the low end of management’s April 24th guidance. Operational issues were the cause. Some analysts are concerned because this is the 2nd quarter of such issues. Thus, the tendency is to extrapolate. But that is a human flaw. For a complex manufacturing process, operational problems are either indicative of poor process controls, or they are simply random events. Engineering types who follow the stock can perhaps answer this question. For now, let’s give the company the benefit of the doubt and call it random events, non-recurring glitches.Add Comment
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