Tuesday, February 03, 2009

Earnings Day

So far, after a few short days the Electronic Arts (ERTS) position is underwater about 8%. They release their earnings today after the bell. For the most part, analysts share a pessimistic view and feel the quarter will be disappointing. The company had already warned that the quarter would be weak back in December. I was hoping that much of the negativity had been priced in at the time of purchase with shares trading roughly where they were after their initial warning.

Hoping for the best here, but if the afternoon report is a disaster, I'll try to get out as best I can. With all their cash, I would think that the company has limited downside, but I've been wrong plenty before.

*** Edit ***

Looks like it is going to be brutal. The numbers are pretty bad. I guess I'll be losing some money here real soon. Shares halted... not a good sign.

*** Edit #2 ***

Shows what I know... shares have resumed trading in the afterhours market, and surprisingly, they are trading UP! I figured low expectations were built in, but the numbers were well off what I thought would be palatable by the street. I'm going to be getting out of this thing.... at the very least I'm going to unload at least half of it before the conference call.

*** Edit #3 ***

Unloaded just over half at the same price as I purchased ($16.15). Will hold the rest of it for a little and see how things unfold. I still plan on dumping the rest of it soon... if not tonight, then certainly later this week.

*** Edit #4 ***

Closing the books on this one... dumped the rest of it ~40% at 16.43. I obviously had the Street's expectations pegged wrong (fortunately), and I must really not understand something, but I can't say I like much of what was announced in the earnings release. More or less break-even given the size of the trade. Up enough for a nice meal, but nothing more.

I'll continue to follow the company. Even if it goes up from here, I'm not going to kick myself, because when that report first came out, it scared the crap out of me.

No comments: