CRAY

[basonista]

As we can see on the mid-term chart, CRAY formed resistance at the $1.35 level:



When David bought the stock, it had broken out of a short term ascending triangle from exactly this $1.35 level:



$1.35 was tested on Monday and held up followed with a nice up move yesterday.  I had decided to sell at one of the fib levels (forget which one now) a little higher than $1.35 but saw that buyers were building up at that level so decided to wait and see if that would hold which it did.  Tech has been showing a little weakness this week so we could see another retest of support but I would be surprised to see it drop that low again.  My stop is set for a break of $1.35 support.  There was such strong buying pressure at that point that a break of this level will invalidate it for my trading plan.

I also don't look at the co-founder as leaving as necessarily bad news.  This could be a chance for CRAY to get some young, new blood with some fresh ideas to help them along.  We'll see if the market agrees.

[basonista]

Looking good. 

I am cautiously optimistic that the current bull run will continue through December.  I am also pleased with CRAY bouncing off support and then moving up when the markets were generally moving lower.  I really feel that CRAY looks good at this point and has a lot of upside potential left in it for the short term.

But as usual, do your own DD. 

[422fwhp]

Anyone still holding?

I got in on the last retracement and have seen nice gains so far.  RSI is getting close to overbought territory, imo, but stil has some room. 

Opinions?

...   can't seem to post my nice annotated chart!

[basonista]

I was holding until yesterday.  I have been impressed with how CRAY is holding up in the face of high selling pressure.  I thought that pressure was going to get it towards the close yesterday when it dropped to 1.65 and it looked like the buyers were going away while the sellers were jumping in.  I also had to leave right before the close so decided to sell only to return and see that it did rally and closed at HOD.

[David Randolph]

I was holding until yesterday. I have been impressed with how CRAY is holding up in the face of high selling pressure. I thought that pressure was going to get it towards the close yesterday when it dropped to 1.65 and it looked like the buyers were going away while the sellers were jumping in. I also had to leave right before the close so decided to sell only to return and see that it did rally and closed at HOD.

Hello basonista !

I would forget about it now, volume on this second leg up was lower than on the previous one, possibly $1.70 - $1.73 will be a resistance level for some time.

You did well, I sold much lower than you did because of a stop loss.

Good luck for your next trades !

[la-onda]

update 

Cray Inc. Announces Selected Preliminary 2005 Results and Updates 2006 Outlook

Tuesday , January 10, 2006 16:00 ET

SEATTLE, WA, Jan 10, 2006 (MARKET WIRE via COMTEX) -- Global supercomputer leader Cray Inc. (NASDAQ: CRAY) today announced selected preliminary results for the year 2005 and provided additional information about 2006.

In the November earnings press release, the company indicated that total estimated 2005 revenue would be in the range of $195 million. Based on preliminary results, total revenue is now expected to be about $199 million. Cash and short-term investments as of December 31, 2005 are expected to be approximately $46 million and Cray has not borrowed against its $30 million credit facility.

Cray expects to announce fourth quarter and full year 2005 results in the first part of March when year-end results are final.

Cray also announced that it had received important customer acceptances in the fourth quarter of 2005, including one from the Korea Meteorological Administration (KMA), where the company installed a large Cray X1E(TM) system. Cray also received acceptances for large Cray XT3(TM) systems installed at Oak Ridge National Laboratory, Pittsburgh Supercomputing Center and the Swiss National Supercomputing Centre (CSCS). It is expected that all of the customer acceptances will be included in 2005 revenue except KMA, which is not expected to be recognized as revenue until the fourth quarter of 2006.

"We finished 2005 strongly, exceeding our projected revenue, improving our cash position and securing a number of key customer acceptances," commented Peter Ungaro, President and CEO. "Our focus on reducing operating expenses has also been successful. We are beginning to benefit from cost containment measures put in place over the past six months," Ungaro said. "Though it is still early in the year to provide a more refined outlook, we expect to grow our business in 2006 and return to profitability in the second half of the year."

While a wide range of results remains possible, Cray anticipates annual revenue in 2006 will be higher than 2005 levels, likely growing between 5 and 15 percent. The company expects that the second half of 2006 will be stronger than the first half, with approximately 65 percent of total annual revenue to be recorded in the second half of the year. The second quarter is anticipated to be the lowest in terms of revenue. While the first half of 2006 is expected to incur a moderate operating loss, the second half will likely show an operating profit.

The first half of 2006 will be affected by three key developments:

--  Delays in U.S. government funding: Cray reported that U.S. government
    appropriations legislation that funds the Department of Energy and the
    Department of Defense for Fiscal Year 2006 was signed into law in November
    and at the end of December 2005, respectively.  Because of these and other
    possible delays, the timing of when Cray customers will receive funding for
    their projects remains unclear, and the company may not be able to record
    revenue for certain installations until the second half of 2006.
--  Planned product upgrades: Cray reiterated its plan to upgrade the Cray
    XT3 systems to AMD's dual core technology and is on target to implement the
    upgrades in the summer of 2006. As a result, the majority of the Cray XT3
    upgrade revenue will likely occur in the second half of the year.  Other
    product upgrades could delay recording revenue until 2007.
--  Customer orders and acceptances: Cray is currently engaged in a number
    of large procurements. However, the timing of any orders and acceptances
    resulting from these procurements remains unclear, and it is likely that a
    significant portion of any revenue related to these procurements would be
    recognized in the second half of 2006.

Cray announced that it will present at the Needham & Company Eighth Annual Growth Conference in New York on Thursday, January 12, 2006 at 4:00 p.m. (Eastern Time). The Cray presentation will be available to the public via live audio webcast. To listen to the webcast, go to the Investors section of the Cray website at http://investors.cray.com. An archived version of the webcast will be available on the Cray website for 90 days.


AH up 21%:
http://finance.yahoo.com/q/ecn?s=CRAY

[la-onda]

Needham Conference slides (16):
http://library.corporate-ir.net/library/98/983/98390/items/179268/NeedhamConference2006.pdf

updated chart:

[Melf Elf]

Partial Repost From The Personal Logs Board - Melf's Workshop:

#3 - February 15, 2007 - CRAY reported earnings of a $0.33 profit vs. a loss of $0.42 in the prior year.  Additionally, CRAY won an $85 million British supercomputer contract.  What was the reaction to that good news?

CRAY broke out above a Symmetical Triangle, crossing 13.23, putting 16.94 IN PLAY, took out both highs of the pattern (13.45 and 13.32), and closed near the high of the day.

Big difference between Friday's reaction to good news , and the prior two reactions to good news.

Friday's (February 16) response was a tempered, bullish response (Symmetrical Triangle breakout) that held up into the close.  No huge "Gap To Crap" over-reaction to the good news.

If we were watching CRAY prior to, or on Friday morning (unfortunately, I wasn't), we can structure a nice risk: reward trade:

Breakout at 13.23.  Target IN PLAY is 16.94.  Reward if it gets MADE: 28% gain.

Stop loss: Below the 12.00 low, prior to the breakout (so, 11.99): Risk: 9.4%

Risk: Reward on the trade: 1:3.

Stop loss also could be 12.78, below Friday's 12.79 low.  Risk: only 3.4%.  That would improve the risk: reward to 1:8.

Fundamentally, CRAY is a turnaround story.  This Fiscal Year's estimate is a loss of $0.58.  The prior Fiscal Year was a loss of $2.92.



Next Fiscal Year estimate is a gain of $0.48, so things are on the mend. 

Summary comment:

Watch the market's reaction to the fundamentals.  Markets don't always trade in tandem with the fundamentals, be they good or bad, and the chart/technicals can be of great assistance in helping us to determine how a stock is trading, vis a vis the fundamentals.

Do the fundamentals and technicals agree, or disagree?

My opinion is that "When the fundamentals and the technicals disagree, defer to the technicals, or at least give them strong consideration."

[Melf Elf]

Bought CRAY at 13.11.  Stop: 11.99.  Risk: a loss of 8.5%.

[la-onda]

in @ 13.3

fyi:
Cray initiated with "outperform"
Thursday, January 11, 2007 9:58:08 AM ET
Nomura Equity Research
NEW YORK, January 11 (newratings.com) - Analysts at Northland Securities initiate coverage of Cray Inc (ticker: CRAY) with an "outperform" rating. The target price is set to $17.50.

&

Cray reinitiated with "buy"
Thursday, January 04, 2007 2:58:32 AM ET
Needham & Co
NEW YORK, January 4 (newratings.com) - In a research note published yesterday, analysts at Needham & Co reinitiate coverage of Cray Inc (ticker: CRAY) with a "buy" rating. The target price is set to $15

cheers
O.

[Melf Elf]

Thanks for the information on the upgrades, Oliver. 

The top of the Ascending Triangle on the daily chart that I posted at the weekend comes in today at 13.229, so we'd like to see a close of 13.23, or better.

She's currently BID 13.38...ASK 13.39

Good luck to us! 

[Melf Elf]

Bought CRAY at 13.11.  Stop: 11.99.  Risk: a loss of 8.5%.

Sold 25% of my CRAY at 14.34.  Gain: 9.4%

Raising stop of the remaining 25% to a fractional gain, above my entry.  Risk: none, excluding a gap down.

[Melf Elf]

Bought CRAY at 13.11.  Stop: 11.99.  Risk: a loss of 8.5%.

Sold 25% of my CRAY at 14.34.  Gain: 9.4%

Raising stop of the remaining 25% to a fractional gain, above my entry.  Risk: none, excluding a gap down.
[/quote]

Sold remaining 75% CRAY at 13.23.  Gain: 0.9%.  Gain on the trade: 3%.