Wednesday, November 28, 2007

And in the news today...

AMD is apparently pondering the purchase of Aegia.

This of course is a smart use of executive time when you have no cash in your pocket and a competitor who is coming at you like speeding train. But heck - let's sell out the company completely to acquire whatever we need because we're all so fixated on getting 30% market share.

It's no wonder AMD's stock hit a 1 year low all the way down to $9.80 a share. When you have them publicly contemplating folly like the above, of course investors are going to get spooked.

And my final whinge is Doug Freedman from ATR who downgraded the AMD stock. Saying there are no positive catalysts...

I contniue to laugh at how blase some folks on Wall Street can be as I point you to these post I had written some time ago chronicling how the gurus on Wall Street get to call the market with little impact:

Post 1

Post 2

I had vented when Mr Freedman called a Buy on AMD at 14 odd $ back in May. So read the posts and now think about how much money you would have made or lost had you followed the recommendations.

The primary fall out of AMD's stock going sub 10$ is the board will have to consider replacing Hector. Now don't get me wrong. I like Hector. I think he has cojones and he took on Intel and gave them a fight that must have scared them half to death. But he let it go to his head. He got to focussed on breaking Intel's market share and getting to 30% which he must have though is the tipping point. What he should have done is focussed on building a profitable and sustainable business and the market would have rewarded him with the market share.

Alas, it is human nature to want to touch something shiny...specially when you think it's soooooo close. But if you over extend yourself, you topple over and that is what you should never forget. The laws of physics still apply - so work within them.

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