"Where are we running?
We need some time to clear our heads." - Lenny Kravitz, Where Are We Running?

So MSFT misses its revenue target estimates and has its first down quarter (y/y) ever in its history AND refuses to give guidance.  Other technology company bellwether's have reported decent numbers (Apple, IBM, Amazon) given the new expectations. But what do we make of the lack of visibility for the rest of the year?  The only thing that is abundantly clear is that nobody knows.  Everyone is afraid to step out on a limb and predict.

If you are an active stock trader in this market, you must be excited.  With so much uncertainty comes opportunity... for those with sufficient kahunas to play.  Look at Sierra Wireless locally, for example.  $700M in 2008 revenue after the Wavecom acquisition. $75M in EBITDA (proxy measurement for cash flow for the accounting impaired).  What is the consensus for 2009?  Without any help from the Company, analysts have zeroed in on a 15% decline in revenue to $600M and a 3x reduction in EBITDA.  But those are forecasts... do we really know?

A month ago, SW traded at a market capitalization of $125M.  It's entire enterprise was valued at $25M.  I kid you not.  A trader looking at this company would have smelled an opportunity.  Today the valuation is up 65% to $205M in market capitalization and $104M in enterpise value, a nice jump. But what is a high technology hardware company doing trading at 2.6x P/E and 1.4x EV/EBITDA?  Cripes, Teck Cominco is at 7.4x  P/E. 

This is one example in a sea of possible undervalued companies.  Good luck to the traders... as long as the forecasting is uncertain, the opportunities abound.