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UTStarcom a Near-Term Hold

 May 27, 2008 09:41 PM UTC
Return Risk
-14.33% MID
Tracked Blogger
Symbol Sentiment Start Return Closed
UTSI Neutral/Hold 05/27/08 -61.51% --

Graphic_arrow1 Via Zacks Analyst Blog:  

We believe market demand for the company's IPTV and optical transport solutions remains firm as opportunities appear respectable.


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Dan Sayre   69%     1 point   commented 418 days ago reply

This stock is a falling star. There are so many stats to make you ponder, "Why didn't I short this stock earlier?" First, consider the number of times an insider has bought company stock vs. selling stock. Simply put, a majority of insiders do not sell stock unless they feel the stock price is circling the drain. The company is in a hot economy (India's) in a hot industry (telecommunications infrastructure and equipment). Growth is great but too many times companies sacrifice cost containment to achieve growth. UTSI wins contracts but at what cost?
It seems many investors are fooled by the UTSI's +20% sales growth. But sales growth does not correlate with stock price growth. The company reported negative income. Its 5 year average net profit is -4.7%. What value are the managers providing for the stock holders? Sell short and get rid of it when the price hits a $1.


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