Quote:
Originally Posted by GregWeld
IBM has a 1 year TR of DOWN 9.6% a 3 year of DOWN 8.8% and worse yet is a 5 year TR of UP 35.6%.....
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It also helps to learn a little about the company before you throw money in just looking at a chart. I work in the same industry as IBM and 14 years ago was a design engineer at a factory building tools to sell them for their NY and VT factories. IBM used to be one of the 4 companies we partnered with on semiconductor process development. I have a lot of respect for where they have been. In recent history though, they have suffered. Their semiconductor MFG has been bleeding red for a while and the CEO has been under pressure to offload it.
They recently made a deal with a foundry to take the semiconductor MFG group, a large amount of their intellectual property, and gave the "buyer" $1.5 Billion in cash and a deal to buy chips from them. That is why the stock has suffered. So, when you see a company's stock drop, make sure you do a little research and find out the backstory before you just dive in! Now, looking forward, can they do well without the in house MFG? Historically some companies, like Qualcomm, have, others, not so much. Sometimes owning the MFG can be a competitive advantage (just ask Intel and Samsung). Their stock could take off, time will tell. For better or worse I will stay away from this one.
An article on the IBM deal:
http://www.bloomberg.com/news/2014-1...chip-unit.html
Generally I stay out of the semiconductor stocks, I am too close to it if that makes sense to you. The Intel deal I picked up on early last year was too obvious to pass on. I then sold it when I thought it was back in line, still made me nervous to hold on to it.