Analyst Estimates-INFY

I found this interesting piece of information on analysts estimates on INFY by the Wall Street. The lowest target was $54 and Highest target was $71 with a median target of $61. Check out the current price of INFY at $45.

Infact, Goldman Sachs upgraded the stock to “buy” in April 07 after which the stock fell from $55 to $45 and Bank of America gave a buy in Jan 07! Do you still wish to trust broker opinions?

In India, the brokers don’t even give you any numbers. They just ask you to buy a stock because the “growth prospects” are good. And if the stock tanks down, they ask you to hold the stock till eternity!

Is this a bull market for INFY and TCS investors?

Ever since I started writing on the blog I have been bearish on INFY and TCS. Infact my Infosys Trend Analysis post highlighted the importance of market trends by taking Infosys as an example.Ever since writing that post, I have made several people get out of their Infosys positions. Some at 2150, Some at 2000 and some at as low as 1850 also.

Today the stock closed at 1745 odd levels and fall was sharp. I feel that INFY is now entering a bearish phase and it might soon touch 1600 and subsequently 1350-1400. The probability of an acceleration in downward trend is much higher. So just stay out of this stock! Let the world analyze the stock, if you are losing money on this, you can still choose to get out.

Coming to TCS- The stock can fall to 870 levels if 980 gets broken on the stock.

I still fail to understand as to why people are sticking to these stocks despite such underperformance.

Just compare your returns if you had put 1 lakh in L&T and 1 lakh in INFY in June 2007 .

A 1 lakh in INFY would have resulted in a loss of 10,000 netting you 90,000.

A 1 lakh in L&T would have resulted in a gain of another 1 lakh netting you 2 lakhs.

Can you spot the difference? Not only did you lose 10,000 you also lost an opportunity to make 1 lakh.

And then people tell you that this is “bull market”! It is a bull market for the guy who has 2 lakhs in his pocket and not for the guy who is sitting on a loss and wondering what to do.

If you continue to be in such stocks you might end up losing money despite the bull run.

It pays to consider your “opportunity costs” while you sit on your losers!

Stock Watch- Jaiprakash Associates

Jaiprakash Associates is one of the stocks that I like as the stock has been trending up nicely since 800 levels. Its hitting new highs every day.

Disclosures- We are long on the stock.

Market Watch- BHEL, TCS,INFY

BHEL is hitting new highs and TCS is hitting new lows. We are playing the trends by being long on one and short on the other. INFY is also back to 1750 levels which are strong support points to take a small countertrend trade.

RPL and RNRL continue to bleed and it might not be bad idea to do some opportunistic buying in RPL from a longer term perspective. There might be still more pain left in these stocks as leveraged players need to bail out and might be forced to sell at ridiculous levels!

Markets are still trying to make up their minds as to what they wanna do next. Its best to be on sidelines and take the next bets when things get clearer.