We looked at possible short-sale set-ups in RIMM and V last week, and today we see V rolling over after the weak-volume 3-day bounce off the 50-day moving average last week. RIMM continues to drive above its 200-dma, which is not a problem as stocks can often rally 2-3%, sometimes more, past the 50-dma or 200-dma before rolling over. We tend to view this area as a shortable area for RIMM up here just above the 200-dma at around 59.29.A reversal below the 200-dma would confirm a reversal, but so far the stock is hanging up there. RIMM sells at 10x forward estimates, which might attract some value buyers, but as we see it, for a former, hot growth stock like RIMM to sell at 10x forward estimates, it probably means that the market simply does not place a high value on RIMM's future earnings stream, and not that it is necessarily "cheap."
SSS - Follow-up on RIMM and V for Monday November 22
| Published: | 22 Nov 2010 15:31 ET |
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