How did the wind run away from the pig, from GTAT bankruptcy said

Introduction: I take a post Zhu Geliang's attitude to judge Apple sapphire raw material suppliers and smelting system manufacturer GTAT announced bankruptcy protection this thing.

Yes, you are right, one day, the stock price fell from $0.8 to $11.

The K line chart stimulation?

An ear of the heartbeat of the K line graph!

The United States sapphire suppliers of raw materials and smelting system manufacturer GT Advanced Technologies (hereinafter referred to as GTAT) last night announced bankruptcy protection, instant price fell to 90%, from more than and 10 dollars to 0.8 dollars into the final. Although I do not have a penny in the GTAT, but the light to see if it fell back after the cold. Here I take a post Zhu Geliang mentality to judge this event.

An air outlet:

Sapphire has not been applied in the field of consumer electronics, basically as an optical material applications. Until last year, iPhone 5S for the first time in the HOME key and camera cover with a sapphire and attention, and in the process of the development of iPhone 6, there have been news media that iPhone 6 will use sapphire as a screen so that people found a new application field of sapphire. At the same time, the concept of sapphire appears, an air outlet to form. GTAT, including the domestic A stock market is a group of bullshit sapphire stocks began to rise directly to a high position.

A pig:

GTAT is the most fat pig that the wind blows. GTAT crystal growth equipment and solutions company. Mainly engaged in three parts: polysilicon business, photovoltaic (PV) business and sapphire business.

From the company's revenues can be seen, GTAT's income is year after year, but 13 years after entering the stock because of Apple's mobile phone to use the sapphire screen this concept did not fall but rise, up nearly ten times to $20 from a minimum of $2.6 along the way.

Classification from the business point of view, the company removed the concept of sapphire business, other businesses are not stable, volatility, but also in varying degrees of decline. But people are happy and selective to ignore these obvious problems, and put all the points on the sapphire.

We believe that as long as there is a sapphire, before the loss of all is not a problem, the performance will be reversed. In November 2013, apple and GTAT signed a $580 million sapphire supply agreement, plus there have been all kinds of news to Apple will use the sapphire screen, which makes many people almost sure GTAT will supply to apple. Big investment banks, such as Goldman Sachs, also reported GTAT. Goldman Sachs in April 1st to raise the target price of GTAT $24 in May 9th to $22, to the year of August 5th or buy rating, but the target price to $20 target price.

But the acquisition of GTAT sapphire patent technology are hard, from the scale of production experience, but also not much capacity, then advance to Apple about $400 million for the construction of the production line, we see that PP&E and liability increased significantly. But the ideal is full, the reality is very skinny, finally because the technology does not pass, the crystal growth process does not solve the problem of stress, produced a sapphire screen, processing is bad, the rate of finished products is very low, single cost more than $55, which makes the iPhone 6 of the total cost of only $two hundred to take hold of the apple Tak unlucky, only to give up sapphire screen.

The wind is gone

Finally, in September 9th, in people's warm expectations, Apple released a new generation of iPhone 6 and 6+. And many people predict the same, two sizes, a new look, but not the same as apple does not use sapphire screen. This result will undoubtedly reduce the intensity of the original strong winds a few levels, or that the short time the wind stopped, the day GTAT's share price fell 13%.

The previously mentioned Apple gave GTAT prepaid $4 hundred million, apple does not arrive, the 4 hundred million naturally have to go back, but the GTAT is only 3 hundred million, in 13 years of income and how, no way, had to apply for bankruptcy protection. This story explains in a professional terms, that is, next door with a red apple tyrant tyrant said I have a thief how can the technology of cattle, tyrant letter, hit a lot of money cock wire. Now cock wire story did not speak, tyrant brought a gang of thugs to help the door, cock wire simply apply for their own prison refuge.

To say that the wind is completely gone and not objective. Trends in consumer electronics innovation will not change. But there are always some DOA dead? Especially if the revolutionary martyrs in hand not only did not have a gun, and even the kitchen knife is not ready for a time.

Lessons to be learned

Never look for optional. In fact, the GTAT flaw is obvious. Many of our investment losses come from selective neglect.

Never too late to correct. Before the iPhone conference to determine the use of sapphire screen did not have time to run, after the September 9 concept should be resolutely removed. The stock was kidnapped, called Stockholm syndrome, it is a disease, get treatment.

Just look at the concept, do not look at the balance sheet to do investment, just like walking on the clouds to travel. The result of such a dry, as the Westward Journey said, stepping on the clouds, perhaps your prince charming, but it is more likely to be pig eight quit: fall!

Naked will be found. Just as long classic saying: a man jumped from the 20 floor, 19 floor he thought they were flying.

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