The lowest analyst price target for Netlist is 2.25. I'm long, I think Netlist is undervalued even at $2.25 per share and hope Seeking Alpha will allow me to publish a longer article explaining why soon. Meanwhile, in my opinion, at prices well below that, (at appx $1.32) Netlist shares present investors with a buying opportunity.
Netlist investors should know that an article, published by The Street, written by Shawn Ingram, dated 01/17/14 - 01:20 PM EST has false and misleading information which may cause, or have caused, additional downward pressure on Netlist.
The article needs to be corrected on the following points:
1. The headline "Why Netlist is Falling Today" is false and misleading.
2. The first sentence: "...Netlist (NASDAQ:NLST) fell 3.9% to $1.25Friday after winning a patent reexamination appeal." is false and misleading. The improper spacing has been left intact.
3. The truth is that according to both Yahoo finance and Stockcharts.com, Netlist rose 1.54% on extremely high volume. This was the second day in a row that Netlist had risen.
Although a correction won't help investors who see the article over the weekend, and decide to sell at open, it might help explain why Netlist may have a hard time gaining traction for the next few trading days. Due to the size and volume of the stock involved, I hope The Street not only issues a correction but also investigates the trading accounts of the reporter and his friends and family.
Since Netlist is a small company and often trades relatively few shares per day, the publication of false and misleading information could benefit some investors at the expense of others.
False and misleading information may also aid day traders (as thinly traded stocks are easily subject to manipulation and volatility). Netlist longs may want to brace themselves for continued volatility over the next year. During this time, Netlist is poised to rebuild low sales and income figures by negotiating settlement and royalty payments from patent suits. Also, to better it's long term bargaining position, Netlist managements should consider issuing additional shares. Though dilutive, such a move is likely to benefit investors over the longer term by ensuring Netlist is well financed for continued legal battles or settlement negotiations. Long term Netlist investors should be wary of false or misleading headlines from The Street!
Disclosure: I am long NLST, .
Additional disclosure: I am here to exchange financial and trading ideas, and am not qualified or attempting to provide financial counseling or advice. Please do your own due diligence. I do my best, but I have been wrong before. Please follow my comments to see some of my past thoughts, trades, or track record.