NEW YORK (Real Money) -- Critical reversal or buying opportunity?
That's what people are asking themselves about Workday (WDAY), Splunk (SPLK) and Salesforce.com (CRM), three companies that had the misfortune to report unbelievably great quarters at the moment when Ukraine tensions turned into turmoil.
When I used to trade, I always disliked companies that opened up and reversed and reversed hard, especially if there was good news that propelled the initial move. The stocks of all of these companies did just that last week, despite reporting major growth (WDAY above 70%, SPLK above 50% and CRM above 35%) and giving guidance that required all analysts to raise numbers.
But if you are trading at a big-time institution right now -- not investing, but trading -- you are thinking to yourself, that all three just put in tops, tops that could be for the ages. I am not kidding. That's how people think.
They say, for example with Salesforce.com, the fact that it fell about 10% in a single session shows that it has the worst base of shareholders, that they have one foot out the door and that the peak's been reached because it will never again report a quarter this good. Believe me, that's precisely what's being discussed. The taint from reversals is that great.
I would like to look at it differently, though. Salesforce.com has phenomenal revenue growth. It is at the epicenter of the social, mobile, cloud and connectivity universe. It works with every major tech provider and it has developed a sales and marketing platform that's taking share left and right.