The CORRECT date of EARNINGS ANNOUCEMENT is APRIL 19th not tomorrow
LOS ALTOS, Calif.--(BUSINESS WIRE)--April 12, 2006--Rambus Inc. (Nasdaq:RMBS - News), one of the world's premier technology licensing companies specializing in high-speed chip interfaces, will hold its quarterly conference call on April 19, 2006 at 2:00 p.m. Pacific Time to discuss financial results for the first quarter of 2006.
However that still puts us over an earning report for two days.
We will be watching this one, not because of any immediate proximity to our short put strike, but because of the earnings annoucement, coupled with the current court case against Hyndai. ( Seven major memory manufacturers have chosen not to fight Rambus on its patent claims and signed royalty agreements: Hitachi, Toshiba, Oki Electric Industry, NEC, Samsung, Elpida, and Mitsubishi. Rambus attempted to reach agreements with Infineon and Hyndai without success ) A victory in court could bring Billions of dollars to RAMBUS. But an adverse effect could cause just the opposite to RMBS's bottom line
In addition there is abnormal DEEP out of the money action going on in both the Call and Put Volume. (see the numbers below. A lot of action in options almost 20 points out of the money. - Note the put volume for the 35, 30 and our 25 put, and even the april 22.50 has unbelievable premium to be so far out of the money ESPECIALLY WITH ONLY 6 TRADING DAYS TO APRIL EXPIRATION. Either they are expecting a court outcome very very soon (like this week) or an earnings play. I don't believe an earnings play would do that much either way and not 17 POINTS!. so the action has to be over RMBS's patent and its claim of infringement. Like I said we are watching this one.
This position should be worth watching even if for no more than examining the outcome.
PUT PRICES and VOLUME FOR APRIL PUTS
We will be watching the market action on the RMBS underlying and will inform you if we need to do anything before expiration regarding this position.
This may be over hyped, but lets follow it to be sure what is really going on.