{"id":41,"date":"2009-09-10T10:42:48","date_gmt":"2009-09-10T15:42:48","guid":{"rendered":"http:\/\/drduru.com\/onetwentytwo\/?p=41"},"modified":"2009-09-10T10:45:26","modified_gmt":"2009-09-10T15:45:26","slug":"memc-electronic-materials-quickly-recovers-from-earnings-warning","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2009\/09\/10\/memc-electronic-materials-quickly-recovers-from-earnings-warning\/","title":{"rendered":"MEMC Electronic Materials Quickly Recovers from Earnings Warning"},"content":{"rendered":"

Two days ago, MEMC Electronic Materials (WFR) issued a late earnings warning<\/a> stating that it “…experienced a disruption in production at its polysilicon facility in Pasadena, Texas due to an equipment failure on August 7, 2009, requiring a large portion of the facility to be shut-down…The lost production and related costs are expected to negatively affect the company’s revenue and margins in the third quarter of 2009. ” The stock closed down on the day by almost 4%. Since then, buyers have stepped in with notable volume. WFR has now recovered all its post-earnings losses and at the time of writing is up another 4%.<\/p>\n

Normally, I would not think much about this action, especially since WFR’s business is under pressure from falling poly-silicon prices. However, last week, Nick Perry from Schaeffer’s Investment Research, reported heavy call trading volume on WFR<\/a>. The volume was so impressive, I also decided to jump in with the herd (my analysis on options trading volumes suggests that the signal can be quite ambiguous unless the trade follows prevailing trends<\/a>. WFR is currently stuck in a 5-month trading range, so this play was a stretch for me). Now that buyers have shown they are willing to look past the latest operational problems at WFR, I am even more intrigued by this trade and anticipating higher prices in the coming week.<\/p>\n

Be careful out there!<\/p>\n

Full disclosure: long WFR calls<\/p>\n","protected":false},"excerpt":{"rendered":"

Two days ago, MEMC Electronic Materials (WFR) issued a late earnings warning stating that it “…experienced a disruption in production at its polysilicon facility in Pasadena, Texas due to an equipment failure on August 7, 2009, requiring a large portion of the facility to be shut-down…The lost production and related costs are expected to negatively … Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[3],"tags":[33,1592,17,31],"class_list":["post-41","post","type-post","status-publish","format-standard","hentry","category-solar-energy","tag-calls","tag-options","tag-speculation","tag-wfr"],"yoast_head":"\nMEMC Electronic Materials Quickly Recovers from Earnings Warning - ONE-TWENTY TWO: Trading Financial Markets<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/drduru.com\/onetwentytwo\/2009\/09\/10\/memc-electronic-materials-quickly-recovers-from-earnings-warning\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"MEMC Electronic Materials Quickly Recovers from Earnings Warning - ONE-TWENTY TWO: Trading Financial Markets\" \/>\n<meta property=\"og:description\" content=\"Two days ago, MEMC Electronic Materials (WFR) issued a late earnings warning stating that it “…experienced a disruption in production at its polysilicon facility in Pasadena, Texas due to an equipment failure on August 7, 2009, requiring a large portion of the facility to be shut-down…The lost production and related costs are expected to negatively ... 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