Baby thrown out of bath tub
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These days it’s not easy for investors who hold US stocks, because the market has been in declining mode after the sub-prime woes. Do you still remember the DOW 14,000? That was July 19, as I wrote a post “IS Dow 14000 relevant“. Well, relevant or not, the Dow has retreated and it’s now under 13,000.
As individual investors we can not precict the market, nor should we fight against the market. But as general market declines, usually there are some good stocks go on sale. For examples, the Crocs (CROX) and Mindray (MR). Both companies reported good earnings, got a pop, and now went back to the pre-earning price. Some possible explanations: CROX got dragged down by the weak US consumer sentiment, Heelys HLYS’ crash; for Mindray, I really could not find a good reason other than short term investors move money to WuXi Pharma Tech (WX). Both companies (CROX and MR) had some insider sell activities too.
But these are not fundamental factors for the company. As I walked on Shanghai streets, I saw more and more people wearning Crocs. I know some are knockoffs, but most kids wearing the authentic ones (you know how Chinese parents spoil their kids, do you?). For the Mindray, the oversea market (especially US) just got started. So if the party just got started, will you say “let’s go home”?
Disclosure: at this time I hold both CROX and MR.