I still firmly believe in the fundamental story at the company. SIRF is benefiting from the GPS wave of personal navigation devices (PNDs), and riding the growth of Garmin (NASDAQ:GRMN), Magellan, TomTom, etc.
But this year, the big growth story is the rollout of location-based services [LBS] among the big cellular providers. LBS should be a big opportunity, as GPS-enabled handsets get rolled out. And SIRF has lots of design wins already with these wireless carriers.
Nonetheless, the stock has been in a funk since reporting earnings. The selloff has continued unabated for almost a month now. I think it is overdone, and although there is no obvious levels of support being hit right now, I am buying back my positions.
Short interest has also grown by large amounts. As of April, 23% of the float was sold short. That could spark a lot of short covering, if and when. I think the stock will rise back to the 30s at some point this year, offering an attractive opportunity from today's levels.
Disclosure: Author has a long position in SIRF