Meredith Whitney Calls Goldman Sachs Higher. It's Time To Call A Probable Peak In Whitney's Stock.
Meredith Whitney made a name for herself this cycle by giving an honest assessment of banks while many on Wall Street opened wide and had the market pound incredible banking losses down their throat. I like Meredith Whitney for her integrity and honesty.
But, as a contrarian I can't let today's remarks by Whitney pass. Whitney has called Goldman higher with a new "buy" rating and a price target of $186 today. Wall Street loved her remark and it send the stock up $7 yet it is still below the early June high. Her call is after the stock has already run up 160+ percent off of its lows. The stock issued clear buy signals on my trading program numerous times since November but here I would be looking to take profits. Buyers started scaling out of Goldman a month ago. That could be seasonal malaise or it could be the start of something more sinister. Regardless I wouldn't be waiting to find out. Remember my post of a few weeks ago - probable period of malaise followed by weakness. People may be getting ahead of themselves believing an imminent decline to new lows is just around the corner. Longer term, I believe Goldman is very likely to endure a fight for its very existence as it tries to transform its business model. Today the company seems oblivious to fundamentals lining up against its major lines of business.
This brings up a good point. Much of what I would classify as "hyper"-success in business fits under the idiom of a one-hit wonder. Being in the right place at the right time to make an inordinate sum of money or receive tremendous accolades is hard to replicate. Sometimes its better to be lucky than good. That applies to Goldman's business model and to Meredith Whitney's current fame. Making a call on Goldman to move higher after it has already run 160% isn't what I would classify as a prescient or even noteworthy call. Noteworthy would have been to make the call at $55 or $65 or $75 or $85 or $95 or $105 not $145. Whitney now has her own company and she is responsible for getting all of her calls right. Not just the one call that made her famous. Just as fundamentals are lining up against Goldman's business model and continued hyper-success, so too will it be difficult for Whitney to maintain the perception of her prescience. As a contrarian, I would say it's pretty close to the time that I would be selling Meredith Whitney's stock. Not that it is likely to go to zero. But that it has likely hit its all time peak. Sorry Meredith.
But, as a contrarian I can't let today's remarks by Whitney pass. Whitney has called Goldman higher with a new "buy" rating and a price target of $186 today. Wall Street loved her remark and it send the stock up $7 yet it is still below the early June high. Her call is after the stock has already run up 160+ percent off of its lows. The stock issued clear buy signals on my trading program numerous times since November but here I would be looking to take profits. Buyers started scaling out of Goldman a month ago. That could be seasonal malaise or it could be the start of something more sinister. Regardless I wouldn't be waiting to find out. Remember my post of a few weeks ago - probable period of malaise followed by weakness. People may be getting ahead of themselves believing an imminent decline to new lows is just around the corner. Longer term, I believe Goldman is very likely to endure a fight for its very existence as it tries to transform its business model. Today the company seems oblivious to fundamentals lining up against its major lines of business.
This brings up a good point. Much of what I would classify as "hyper"-success in business fits under the idiom of a one-hit wonder. Being in the right place at the right time to make an inordinate sum of money or receive tremendous accolades is hard to replicate. Sometimes its better to be lucky than good. That applies to Goldman's business model and to Meredith Whitney's current fame. Making a call on Goldman to move higher after it has already run 160% isn't what I would classify as a prescient or even noteworthy call. Noteworthy would have been to make the call at $55 or $65 or $75 or $85 or $95 or $105 not $145. Whitney now has her own company and she is responsible for getting all of her calls right. Not just the one call that made her famous. Just as fundamentals are lining up against Goldman's business model and continued hyper-success, so too will it be difficult for Whitney to maintain the perception of her prescience. As a contrarian, I would say it's pretty close to the time that I would be selling Meredith Whitney's stock. Not that it is likely to go to zero. But that it has likely hit its all time peak. Sorry Meredith.
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