Why I'm Cutting Back Riverbed Technology Ahead of Earnings

I was waiting to see if there would be a bounce this morning to see if we could get some extra juice on this sale, but it appears not to be. We've now broken below S&P 894, so 880 seems extremely probable. I said I would cut back my Riverbed Technology (RVBD) position ahead of earnings, which are Thursday, and here at $23.10 I am going to do it. I have had a stop loss at $22.00, but if the stock gaps down post earnings the stop loss will be meaningless.

If you are a believer of the "chart knows," Riverbed should announce good earnings. But what worries me now is what I am seeing in some technology peers -we always say it is not the news but the reaction to the news. Yesterday Marvell Technology (MRVL), a chip maker, raised guidance on revenue, and the stock ended on the lows of the day. This market has gone up on any news for 3 months; it has found a way to manufacture "green shoots" out of anything. So now we have an example of actual good news, and the market found a way to sell that off. That is a change in character we have to respect.

So pending Thursday's earnings report, I am going to lock in our best performer the past few months by selling 5/6ths of the position around $23.10. If it pops on earnings so be it... it is now down to a 0.2% stake.

[May 12, 2009: Restarting Position in Riverbed Technology]
[Apr 8, 2009: Stimulus Fire Hydrant (Worldwide) Should Benefit Networking Companies / Broadband]
[Apr 9, 2009: Juniper Networks (JNPR) and F5 Networks (FFIV) Benefit from Low Expectations]
[Feb 5, 2008: Riverbed Technology Continues to Execute and the Stock Continues to Fall]
[Nov 27, 2007: Riverbed Technology - Fortune Article]

Disclosure: Long Riverbed Technology in fund; no personal position

Comments

[Stone Fox C...:]

Do you have the correct date? Earnings aren't until 7/23. I had the same thought as you, but thats a month away.

Jun 24 12:42 PM

[TraderMark:]

rofl

DOH!!!!!!!!!!!!!!!!!!!...
6/23
7/23
potato
tomato

Jun 24 05:21 PM