Synaptics, Inc. (NASDAQ:SYNA)

CAPS Rating: 3 out of 5

The Company is a developer and supplier of custom-designed user interface solutions that enable people to interact more easily and intuitively with mobile computing, entertainment and other electronic devices.

Recs

5
Player Avatar AnomaLee (28.50) Submitted: 7/2/2008 2:33:22 AM : Underperform Start Price: $27.31 SYNA Score: -13.18

...because this stock is over-valued right nowDon't get me wrong I love Synaptics and their technology. The penetration of their touch technology and supply deals with Apple are great. it's possible that my call may very well be wrong. However, I bought shares when the price was below $28 and sold off my position above $33. I'm a little worried that the shares may be getting ahead of themselves after gaining 7% in one day. There is large short interest in the stock which I last checked to be around 40% of float. I believe the recent climb is due to mass short-covering. Although, earnings per share declined by over 45% net cash flow reported a dramatic increase. I believe this was largely due to a large conversion of short-term investments. I did some further glancing before and I remember asking myself "Why is this company involved in auction rate securities?" The management discussion was vague and the adjustment was for $2 million.To be honest I didn't do enough investigating, but it scared me enough to sale my shares. Anytime I see such a large short position it makes me wonder "What do they know that I don't know?"

Report this Post 2 Replies
Member Avatar ResearchLover (45.46) Submitted: 7/29/2008 1:42:36 PM
Recs: 0

Some may be hedging their gains by taking short positions... Still, I'll agree with you and take my virtual profits before the 7/31 earnings. That's when your idea is likely to shake out.

Member Avatar AnomaLee (28.50) Submitted: 8/1/2008 7:43:25 AM
Recs: 0

Well, I'll be watching this name today...Umm.... I can believe the short position in the options market but it seems that someone is program trading a long-short (possibly 130/30) leverage position from the recent volume and spread activity. Overall, I think my theory was right, but being right doesn't make you money if you're at the wrong time. I'm sure a lot of people are squeezing through the exits from their short position, and there is any wide diverge from expectations you should really see it in the shares. I still think there's still a little short-covering left to do, and I wouldn't be surprised to see shares jump 7% either way...I'll see later on...

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