Posts tagged MS
The market was down strong in the morning as both fears of rising inflation in China and common sense seemed to hurt sentiment, but then like a phoenix rising from the ashes (though luckily not River Phoenix rising from his ashes, because that would have been weird) investors stopped adjusting their bollinger bands, refused to overlay any more pivot points (and Money McBags would love to over lay any of these pivot points), threw away their Ouija boards, and remembered that the key to making money in this market is to simply buy the fucking dip. It is a more fool proof strategy than settling disputes using a two-headed coin or solving a rubik’s cube by merely peeling off the stickers and putting them back on, as the “Bernanke Put” lifts all falling markets (except for maybe Tunisia‘s).
As for data today, new claims for unemployment dropped by 37k to 404k which was below analyst guesses of 420k (and no surprise the guess of 420 was too high, and strangely left analysts hungry). The most surprising thing of all though was that last week’s claims were revised down for the first time since full bush was still in style as they dropped from 445k to 441k, and no that is not a typo. Money McBags hasn’t been this surprised by anything since he learned that Paul Krugman won the Nobel Prize in Economics or Maria Vagina is a real person. As loyal readers know, the B(L)S has consistently employed the “hold the shock and hope for no awe” strategy of announcing better numbers and then revising them worse the next week with hopes that investors’ memories will be shorter than He Ping Ping‘s taint, and it has worked marvelously so far, so Money McBags can only scratch his head at this sudden reversal of strategy as it has made him more confused than Joe Lieberman (though without that old man smell).
In other macro news, existing home sales were up 12.3% to “are you fucking kidding me?” Sales reached an annual run rate of 5.28MM units which destroyed analyst guesses of 4.85MM as a 1% drop in home prices, a jump in mortgage rates, and a buy one foreclosure get one free deal swept the market. That said, it is hard to, well, get hard about these numbers (unless you are reading them while Ali Sonoma gently whispers sweet nothings in to your ear) as sales are still 3% below last year’s number and 36% of sales were from distressed homes which include foreclosures, short sales, and wherever Charlie Sheen is sleeping.
Finally, the Philly Fed index dropped to 19.3 from a downwardly revised 20.8 and those numbers mean less to Money McBags than brevity means to Tolstoy (though Money McBags does love him some War and Peace) or “no” means to Ben Roethlisberger. If anything, Money McBags is surprised the Philly Fed doesn’t always register as a negative since the only thing the city knows how to produce is crime, broken dreams, and heart attacks. Oh yeah, the Conference Board also came out with their index of leading indicators which rose 1% and brought the index to a record high thus securing its place in the annals (and anals) of economic forecasting as the least valuable index yet (just nudging out Art Laffer’s random number generator and GDP).
Internationally, China’s economy expanded 10.3% in 2010 thanks to lending being looser than Arizona’s gun control laws or Alexander Hamilton’s interpretation of the Constitution, a shitload of state run infrastructure investments, and overwhelming demand for pee pee flavored coke (and loyal readers, Money McBags is terribly sorry for using that joke again, but you see, he has made the same reference now for the past bazillion China stories and is experiencing a bit of joke OCD). The big concern is that inflation continues to be high as the rate was 4.6% in December and many economists expect that pace to pick up again soon due to rising wages and seasonal factors like the Lunar New Year holiday in February and the release of Yoko Matsugane‘s new calendar.
In the market, MS was up 5% as their profit jumped 60% to “lobster tails and blow jobs for all.” That said, the company either beat or missed analyst guesses of $.35 eps depending what you want to count as one-timers, gains from sales, and straight up manipulation. The driver of MS’ performance was their strong retail brokerage fees as clients came back in to the market to buy the fucking dip and that offset shitacular results from MS’ fixed-income division. And in the fourth most closely watched number (after 36, 24, and 34), MS’ compensation expense was 51% which dwarfed GS’ sub 40% ratio and ensured that no one at Morgan Stanley will ever have to lower themselves to slumming in a 5 series again.
In other earnings news, EBAY was up after they beat earnings guesses on sales of $2.5B which is a fuckload of Johnny Dickshot autographs. To be honest, the most surprising thing to Money McBags was that EBAY is even still relevant since the last time he used them was to a buy a new stylus for his fucking Palm Pilot. That said, Paypal revenue (and yes, Paypal sounds like a NAMBLA dating site) was up 22% and is now 39% of EBAY’s revenue as mobile devices have made e-commerce more ubiquitous than bad grammar or Paris Hilton’s vagina. More importantly, EBAY gave above the Street guidance for 2011 as analysts were outbid on their guesses after EBAY waited until the last second to make guidance public.
Elsewhere, F5 Networks was down ~20% after posting weaker than guessed results, having a book-to-bill ratio below 1, and closing fewer big deals than a member of BBW Personals Plus with a book of McDonald’s coupons and a year’s supply of Crisco. You all know Money McBags is a big proponent of cloud computing because there is no reason for any business to have an IT department, so look to buy into weakness in the sector. And finally. Arby’s is for sale with the bidding starting at “go fuck yourself” because why anyone would want to buy a shitty fast food restaurant with an outdated concept is more puzzling to Money McBags than why someone would build a cathedral from trash (or from anything) or want to watch this.
In small cap News ISLE was down ~12% after pricing an offering of 5.3MM shares at $10.25 and as you all know Money McBags has called this company out as a short many times (though he did tell you to take some of your profits off the table after their last Q). As he said, they are simply burning too much cash and have too much debt so it was obvious that they were going to have to raise cash somehow since their run down casinos don’t bring in the poor and unfortunate like they used to.
Also, Money McBags wanted to bring CTGX to your attention again as ~35% of their business is tied to staffing for IBM server installations and as we saw yesterday, IBM’s service contracts were up like a priapism sufferer when standing next to Bree Olson. In the past year Money McBags has broken CTGX down exhaustively on the award winning When Genius Prevailed (just throw them in to the search box, while Money McBags throws himself in to searching for Katie Savoy‘s box) and we’ve made well over 50% on the name but the stock still remains relatively cheap if they can continue adding EMR projects at the pace they have been (they had 6 new RFPs last Q) and especially if they continue to see a pick-up in their boring and shitty staffing business which Money McBags has completely discounted.
Guidance is for ~$.50 in eps this year and with new EMR additions, Money McBags thinks $.75 eps is possible for next year if everything else stays as flat as Jennifer Connelly‘s acting. That said, their staffing business has had a huge bounce back growing ~27% and if the pick-up IBM saw this Q can trickle down to the shit CTGX does for them, then the company could easily beat the $.75 eps guess. CTGX is currently trading ~15x that but IBM’s Q is intriguing enough that they could put up a surprising quarter and Money McBags thinks you can buy in ahead of that Q.
The market rally was back on today with stocks shooting up faster than Ben Bernanke could chant “quantitative easing” over his bubbling cauldron (though he was heard incanting: “Double, double toil and trouble; Dollar burn, and assets bubble“) and faster than Sofia Vergara‘s son’s popularity on take your mom to school day. That said, with little news and sort of positive earnings results, the strength of the rally was more confusing than AIG’s balance sheet or why people with the last name Wadhams would name their son Dick.
Macro news was light today with mortgage applications falling by 10.5% (though as far as Money McBags knows, 10.5% of 0 is still 0) even with near record low mortgage rates. Refis were down 11% (due to something about not being able to borrow against an asset you no longer have equity in) and purchase mortgage applications were down ~7% (due to something about no one having any fucking jobs). The only other macro news was that Bernanke released his beige book today which was nowhere near as insightful as his little black book where we learned that it takes more than just a strong M2 to get in to Elizabeth Duke’s overnight facility.
The beige book basically showed an economy staler than Money McBags’ writing (and with 1/2 the dick jokes) as the recovery is now continuing on at merely a “modest pace” which was enough to erase any doubts of the upcoming QE2 (and it is not upcoming because it has Peyronie’s disease, but rather because it will occur at the beginning of November). Highlights of the modest growth include 8 of the Fed banks reporting some growth, 2 reporting mixed economies, 1 holding steady, and Atlanta reporting that “shit is still fucked up.”
The only other interesting story today was that according to Bloomberg, the government made an 8% return on the Wall Street bail out which not only beat returns on Treasuries and money market funds over that same time period, but the $25B the government made should be enough to fund the SEC’s tranny porn habit for years to come. That said, the TARP can now be seen as an unmitigated success (unless you also add back the loss from non-financial bailouts such as GM and the fact that the slippery slope of moral hazard for bank risk taking is now not only slipperier than Teflon with it’s coefficent of friction of .04 but sloped steeper than Ashlee Simpson’s new nose). Given that, Money McBags plans to run for Senate under the “Bail Outs Give Us Savings” platform, or BOGUS for short, as bailing out failing companies seems to be the only way the government may get out of debt. It’s a bit counter intuitive, and completely illogical, but with social security benefits soon to be fucked, the government has to do something to raise their returns and TARP II seems to be the best alternative.
Internationally, the Chancellor of the Exchequer George Osborne detailed the deepest budget cuts ever in Britain (though why the ex-chequer’s chancellor would be in charge of that and not the current chequer’s chancellor, is beyond Money McBags). The cuts will eliminate ~500k public sector jobs, add a new levy on banks, and limit the Queen’s Netflix plan to only two movies a month while completely shutting off her membership to the Bang Bus (google at your own peril). The new plan will also cut welfare by 7B euro by capping benefits to unemployed families, curbing payments for housing subsidies and tax credits, and simply rounding up poor people and telling them to get the fuck out.
Earnings news was mostly positive today with WFC reporting a huge Q driven by improved credit, increased revenue from community banking, and sleight of hand. As always, Money McBags believes in bank balance sheets and bank earnings as much as he believes in karma or female friends without benefits because bank assets remain less tangible than the Higgs Boson. And it’s not just Money McBags who feels this way as noted adventure capitalist to the stars Jim Rogers was on CNBC today and said bank stocks are still unattractive because of the uncertainty with their balance sheets. Um, Jim, you know what Money McBags calls uncertainty in bank balance sheets? Wednesday.
In other earnings news, BA flew above analyst guesses and earned $1.12 per share after a loss in the year ago quarter as jet deliveries picked up, YHOO searched for a good Q and came up with more of the same, and MS stumbled by earning only $.05 per share from continuing operations (and Money McBags would love to be part of the team that decides which of their operations should be continuing) vs. analyst guesses of $.15 per share. Also, just about every airline stock flew higher than Icarus (and luckily their wings were made out of metal) as Delta, American, and United all posted positive earnings which came in only four hours late.
In small cap stocks, most companies Money McBags follows had strong days as they tend to have high beta with the market due to their small size and yet high growth profiles. That said, Money McBags finally got around to looking at WGO’s Q and loyal readers will know he is prone to shitting all over this stock as if he’s filming his own scat film. Money McBags’ thesis remains that in a fucking recessionary environment, people are going to be less interested in buying ridiculously expensive completely discretionary products (when there are much cheaper alternatives) than Travis Henry is interested in buying a condom (or a financial planner). That said, they put up another meh quarter and have rebounded faster than Money McBags thought they would, but they are still trading at a valuation that is less attractive than Minnie Driver‘s gunt.
Revenue of $123MM was up 107% in the Q which would seem spanktastic but it is coming off an almost company killing low number and was down sequentially by ~9% which isn’t seasonality because in the sequential Q last year, revenue was up 30%. The company did manage to boost gross margin to 8.5% (ex,. the $750k LIFO adjustment) from ~7.5% and hold their operating costs flattish at ~$6.3MM. The interesting thing to Money McBags (besides Gia Allemand) is that their expensive Class A gas vehicles drove sales and were up a bit sequentially while their cheaper Class C vehicles were down ~33% sequentially, so Money McBags guesses as long as people are going to blow money on something they don’t need, they might as well go all out. Afterall, overspending is the American way.
So the company seems to have reached a stagnant/steady state sales level and earned $.17 but did not pay taxes due to carrying forward losses from 2009. Their Q isn’t out yet so Money McBags isn’t 100% sure how much of a benefit they have left but he thinks that they had ~$6MM last Q and would have used ~$3MM this Q so have about one more Q before they have to pay taxes, but again, Money McBags is pulling that so far out of his ass that there are still whole chunks of undigested food in it. So if we take the $.17 reported EPS, deduct out the 750k positive LIFO adjustment, and tax it at 35%, real run rate earnings are more like ~$.09 per share, and as a reminder, this company is trading at ~$9.50.
So what the fuck do we do with this as their business seems to have leveled off, the economy is not getting better, there is still a strong secondary market for used vehicles, and they have cut every cost they possibly can. Even if we take the best case scenario $.17 non-taxed LIFO infested EPS and annualize it, we get ~$.68 and the company is trading at ~14x that despite a sequential sales decline and backlog down 13% (and yes, Money McBags said backlog, huhuhhuh). Using the taxed EPS number, annualized EPS would be ~$.36 so they are trading at 25x that, which makes this valuation more out of whack than Rachel Uchitel‘s lips. EBITDA was ~$7.5MM so that would put them at a ~$30MM run rate and their EV is ~210MM so they are trading ~7x that which isn’t terribly expensive but one shitty economic Q and margins go back negative so there is still a fuckload of risk for this company.
Money McBags thinks earnings will remain ~$.10 to $.15 because growth has been basically flat for 3Qs so next year maybe they earn $.50 and Money McBags wouldn’t pay more than 10x for that so WGO is still something that is worth shorting. Fuck even if they hit $.60 for the year, is that worth paying 16x which is where the company is now trading?
The market was chugging right along today like a Kennedy at a sorority mixer after Apple titillated the market with sales stronger than the breath of either of the world’s foremost cunning linguists, the great Vladmir Nabokov and the greater Janine Lindemulder, until Ben Bernanke got up and threw his figurative Baby Ruth into the market’s pool causing investors to run for safety. Bennie B. got his best gangsta lean on and told the Senate Banking Committee, who never met a bubble they couldn’t regulate after it had already deflated itself, that the recovery remains “unusually uncertain and shit” before repeatedly rhetorically axing “you know what I mean?” His befuddling remarks caused the market to fall faster than Andrew Johnson’s reputation in the Republican party after suceeding (or more appropriately, failing) Lincoln and thus negated a rare day where earnings were mostly positive.
While it’s not entirely clear what “unusually uncertain” means, especially since Money McBags finds all uncertainties a bit unusual, he believes the term is Fed-bonics for “We have less of a fucking clue about what is happening than we usually do.” Bernanke did say the Fed is ready to step in as needed and while he didn’t say what those steps may be, one can assume they include keeping rates low (for an extended period like a metrorrhagia sufferer), manipulating the Fed’s balance sheet, and the Charleston.
Prior to Bennie B. unleashing his pimp hand and treating the market like his bottom bitch, President Obama signed the financial legislation bill which after two years of debate has been watered down more than a virgin bloody mary without the tomato juice or tobasco (though he signed it “Alan Smithee”, so it’s not clear if the bill will hold). The most worrisome part of the bill is that many of the details are more open ended than Alexis Texas right before filming Buttwoman which leaves regulators plenty of wiggle room to fuck more shit up. As far as Money McBags is concerned the bill didn’t go far enough in regulating the use of derivatives, in limiting the size of banks, or in raising reserve requirements and making banks responsible for their greed which led to credit scoring models to be less frequently used than MySpace (does anyone remember that piece of crap?).
In macro news, mortgage applications jumped last week for the first time in five weeks in what surely is a fictitious number, or a typo. What is more believable is that refi applications were at 14 month highs as record low mortgage rates of 4.59% have led homeowners to lower their interest payments faster than the Stoughton, MA police department lowered the boom on one of their officers who was just doing a little (and Money McBags stresses “little”) due diligence.
The real story of the day (other than Bennie B.’s uncertain uncertainty) was Apple’s Q in which they sold what is known in the retail space as “a fuckload of shit” and put up a huge earnings number. Apple’s net income rose by 78% by selling 3.3MM iPads, 8.4MM iPhones despite people waiting until the end of the Q for the iPhone 4 launch in order to be able to make use of the front facing camera while masturbating for strangers on chatroulette from work bathroom stalls everywhere, and a whopping and quarterly high 3.5MM Macintosh computers making everyone loudly say “Apple sells computers?” Revenue was up 60% to $15.7B, beating analyst guesses by $1B, and putting the company only $4B away from world domination. Steve Jobs also defended the iPhone antenna problem by simply saying “deal with it. And if you don’t like it, go by one of those Blackberries and make sure it matches your 8-track player and Jams.” That said, Lenovo is set to launch a challenger to the iPad using GOOG’s Android system and they are referring to it as “LePad” because apparently “LeThingThatIsn’tGoingToSell” was already taken.
In other strong earnings news, MS put up a ginormous Q, harkening back to the pre-2006 days when investment banks ruled the markets like Jessica Simpson ruled the short bus in her elementary school days. Revenue grew 53% to $7.95B and beat analyst guesses of $7.93B driven by MS’ trading business which earned $4.1B in operating profits after trading their souls for three more months of manipulating the markets and a good night kiss from Rose Huntington Whiteley. Also, KO put up a good quarter on the heels of PEP’s outperformance yesteray once again reinforcing the demand inelasticity of sugar and water. KO earned $1.06 per share, beating analyst guesses of $1.03 per share, and saw 5% growth worldwide led by international growth ex. Europe of 6%. Money McBags is a longterm owner of KO because it is a cheap aspirational brand that appeals to emerging markets that will continue to grow as the US slogs its way towards mediocrity (though mediocrity would be a good thing). Finally, YHOO dropped 8% on a disappointing earnings report as revenue growth remains more challenging than Sudoku for a dyslexia sufferer.
In small cap news, Money McBags mentioned CRUS yesterday but he was in such a time rush that he missed their quarterly earnings release from earlier in the day which turned out to be more positive than Robin Williams’ herpes test. The company earned $.29 per share in the quarter on 118% y/y revenue growth and margins going to 57% from 52% last year and 56% last Q. Most surprisingly, their energy business jumped up to $28MM from $22MM as a result of the both the power meter business and their energy exploration business. On the call, they talked about this business but gave fewer useful details as to what is driving it than a republican strategist gives details about their plan to fix the economy.
That said, it’s really CRUS’ consumer audio business that has investors drooling over this company as if it were Hayley Atwell as they provide an audio chip for the iPhone and that segment absolutely killed it. Revenue was up 32% sequentially in that segment with Apple moving to 35% of their overall revenues. Company guidance was also stellar with next Q predicted to have at the midpoints $102MM in revenues, 57% gross margins, and $27MM non-Gaap op ex. and while Money McBags is no maffematecian (he only counts to two when told to turn his head and cough), those number should get them to ~$.44 eps as they still have more NOLs than Money McBags has broken dreams.
The hard part is forecasting this company since they are obviously a play on the iPhone and AAPL could find a new suplier or put more pricing pressure on them at any time. Now look, Money McBags doesn’t think that will happen anytime soon as their chip is supposed to provide the best audio quality and they are continually investing in R&D, but it is something of which investors should be aware. Money McBags’ previous estimate for fiscal year EPS was $1.20 but with CRUS earning $.29 per share in Q1 and guiding for $.44 per share in Q2, $1.20 seems like it is lower than Andy Rooney’s balls. So Money McBags is going to get a bit conservative here and estimate that the energy business falls to ~$24MM quarterly run rate, the non-AAPL consumer business stays flat, and the AAPL business only grows 10% sequentially.
Doing that (and using 55% margins which may be on the low end and $110MM op ex), Money McBags gets an estimate of $1.47 which is about double what they should earn in the first half of the fiscal year. Of course, those are very low end estimates as the AAPL business has been growing 30%+ sequentially and gross margins have been above 55%, so at the hgh end we could be looking at closer to $1.70 EPS for the fiscal year.
Either way, the stock is now trading at ~$19 which is ~13x Money McBags’ low end estimate and the company has ~$2.50 in cash on the balance sheet and 13x for a company growing this fast is just way too fucking cheap. If you want, throw a 20x on $1.47 and get to ~$30 for a target price. As long as Apple doesn’t pull the rug out from under these guys, there is plenty of room to move up even though it has already had a better run than a roidal Ben Johnson.
The news today is earnings, earnings, earnings, and Sophie Turner. The markets are inching up after a strong slate of mostly positive earnings reports (not so fast AT&T and GILD). However, before we get to earnings which featured Apple taking other handset makers out to eat, getting them drunk, and then giving them a cleveland steamer as a reminder of their dominance, Greece is back in the news. Investors are worried that Greece may take 45B euros in aid before actually agreeing on the terms which is very TARP-esque of them (one wonders if they are going to use Hank Paulson’s preferred contractual device of a napkin to agree to country changing policies). With terms of the aid more open than Joslyn James‘ anus right before Tiger Woods “sinks a putt,” the risk premium on Greek bonds has soared to 512bps which is higher than anything in Greece has gone since Icarus let his ego get the best of him. Concerns remain that Greece may not be able to pay the 8B euro coming due in a month and in a show of support, Greek workers are about to embark on their 3rd 24 hour strike since the crisis began which would be crippling if that weren’t somehow still more hours than they typically work in a day. Luckily for them, France is gearing up to loan Greece 6B to 8B euros as part of the aid package. French economy minister Christine Lagard, who in 2009 was named Best Finance Minister in Eurozone by the Financial Times after a stunning rendition of “Mo Money Mo Problems” in the talent portion of the show, tried to calm the fears of a Euro meltdown by opining: “I won’t say Portugal is next in line…” before adding “but I just saw Prime Minister Jose Socrates listing the Iberian Peninsula on Craigslist for “roses.” Boooyah!!! Can I get a Quelle Quelle?”
As for earnings, AAPL crushed their quarter with iPhone sales up 130% leading to a 90% increase in profit and a 49% increase in sales. Apple earned $3.33 per share, well above analyst guesses of $2.45 and said they were “shocked” by how well the iPad was selling. Holy fucking shit is it on. Apparently Apple’s app for taking over the world is a little too good as their products are selling faster than Adam Smith’s invisible hand can fondle unwitting young ladies during New York’s Fashion Week. In other earnings news, Morgan Stanley traded the fuck out of some shit (and Money McBags apologizes for getting overly technical there) earning $1.03 per share after one-timers largely because of their sales and trading unit. Book value is up to ~$28 per share and ROEs are creeping back up hitting 13%. Like every other investment bank, revenues and profits were driven by fixed income traders who bought and sold shit we’ll never know about, who we can’t actually track to see what the fuck they are doing, and who are likely ignoring all but one SEC regulation (and that one of course is to not get high off their own supply). The paper economy lives on, long live made up shit. Also, MCD beat guesses by earning $1.03 per share after one-timers and Money McBags is an owner of this stock because there is huge brand equity for continued international expansion. Operating margins were up 2.2% and same store sales were up 4.2% for the quarter and 5.2% in March driven by 4.2% growth in the US, 5.9% growth in Europe, and 7.9% growth on Mars. MCD is not going to be a high flyer but it offers a nice yield for a franchise that should do well in a world becoming more globalized, even in a down economy.
In other earnings, BA beat numbers, YHOO had a nice bottom line (though not nearly as nice as Jessica Biel’s bottom line) yet missed on revenues since they compete with something called GOOG, and AT&T had a good Q but is selling off as new subscribers were the lowest since 2004 during the bizarre and short lived rotary phone trend. Also, VMWare put up a huge quarter and Money McBags did something he rarely does by buying the quarter of a ridiculously high priced stock. Honestly, Money McBags hates buying things this overvalued more than he hates long walks on the beach, sentences that end with prepositions, and Jane Austen, but he believes in virtualization. This not a fucking fad like Wacky Wall Walkers, YoYos, or the way way too short lived rainbow parties. Revenue was up 35% to $634MM, Non-Gaap earnings were up 45% to $.32 per share, free cash flow was up 68% to $326MM, and overall cash on the balance sheet was a healthy $2.8B. Guidance was for 30% 2010 revenue growth of $2.6B to $2.7B which means the company is currently trading at around 9x 2010 revenues but closer to 6.5x 2011 revenues ex. cash. Yeah, it is a total bullshit metric and Money McBags crapped all over metrics like this yesterday when he advised that SFSF was too fucking expensive, but companies like VMWare often get purchased at multiples of revenue between 6x and 10x so we’re still at the low end of 2011 potential revenue multiples. It certainly isn’t cheap and on a P/E basis it is trading somewhere between astronomical and Warren Buffet heart attack high, but they are a market leader in a space that is absolutely here to stay. IT departments are cutting costs quick and deep, like Lexington Steele losing his virginity, and VMWare’s virtualization software is at the forefront of this (or, to continue with the Lexington Steele analogy, the foreskin of this). Money McBags believes in this sector and cloud computing almost as much as Burton Malkiel believes in efficient markets or as much as aspiring Hollywood actors believe in Scientology and it is why Money McBags will soon be buying TMRK (who by the way received a big investment from VMWare last year). So yes, the stock is pricier than an Ashley Dupre blumpkin, but sometimes you have to pay up for quality.
In small cap news, a Money McBags favorite and his largest small cap holding KITD is bouncing back after a big block trade on them yesterday afternoon which sent them stumbling. The stock is probably range bound to down until they announce a new acquisition or until their next quarterly call in a couple of months so there is no reason to panic and if you are are not an owner, buying any dip is certainly worthwhile. Also, CRUS which Money McBags owns and has written about many times is getting some AAPL momentum today as they produce an iPhone audio chip and as said earlier, iPhone sales were ridonkulous.