Justin M. Hall's  Instablog

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Doggy Comments (39)
 
Hey Justin,

I'm long FSYS and regret not selling at $52 just a while ago.

I'm very concern about their Q4 statement: ..."However, having factored no benefits from subsidies into our outlook for Italy, we do not expect this market to repeat its 2009 performance," the company said.

What make you think FSYS is a buy at this levels?
Would it catch in USA?

Thanks
4 Mar 2010, 11:17 AM Reply Like

Justin M. Hall Comments (753)
 
Doggy:

What was your initial entry price?
4 Mar 2010, 11:25 AM Reply Like

Doggy Comments (39)
 
Average is 32.91

First bought at 41.77 on 12/11/2009
Added some a few days ago at around 28.60
4 Mar 2010, 12:59 PM Reply Like

Justin M. Hall Comments (753)
 
If you view FSYS as a long-term position, then I would definitely continue to add to this position over time. I do like this long-term, i.e. 12 and up to 24 months.

If you view it short-term, then you might wait until it crosses back over the 20 MA which is currently around $29.59. Shares crossed over this mark (20 MA) in early trading and sold-off at the open. So, this sell-off is not telling me to play this as a short-term trade.

After all that said, I do think that it is a good value play right here. Good grief. This is a growth stock trading at 14.72 X earnings. This stock is also HEAVILY sold short and represents an ideal short-squeeze candidate. Holy cow! The short interest ratio is 34.33%. What in the Hell is going on here? (No need to answer that.)

It appears that the current sell-off may be related to the ongoing issues within the EU countries. On CNBC Global Exchange (early AM), a fund manager was commenting on how short-sellers are / have been colluding to drive prices down on EU companies and applicable currencies (sterling and EURO). The current sell-off of FSYS may be related as much of their earnings growth is directly tied to revenue generated from contracts the company has with the Italian government.

CONCLUSION

#1 Forget about the technical stuff. Right now, FSYS should be viewed as a value bet on a growth stock that also just happens to be damn ripe for a short squeeze. Based on the short-interest alone, which is way over done, I would be a buyer.

#2 Based on your average price of $32, I would average down more right here. I am not advocating that you get crazy. Since you seem both intelligent and rationale, however, I don't think this will be a problem! :-)

#3 This sell-off is driven by pure greed. Withholding expletives, those responsible might just get what they deserve. Under this particular set of circumstances, I would add proportionately to an existing position and stand ready to add more if it drops further.


I hope this is helpful. Please do keep in touch. I seriously want to hear about your progress with this stock.


Justin M. Hall
4 Mar 2010, 02:37 PM Reply Like

Doggy Comments (39)
 
Thanks a lot for your response!

FSYS is my largest holding and I can't afford adding much more, otherwise It would completely unbalance my portfolio. So I will have to wait it goes up again :)

I just can't believe how it lost 50% of the value in such a short period of time.
4 Mar 2010, 03:05 PM Reply Like

Justin M. Hall Comments (753)
 
D:

First, you're more than welcome.

Second, I believe your bet on (FSYS) will prove to be a good one. Hang in there.

Please keep me posted on your progress.

Justin
6 Mar 2010, 07:30 AM Reply Like