"Make better out of bad."

-- Christina Nikolov

Name/Ticker: ATMI Inc. (ATMI)

Date: January 2, 2003

Opinion: Bearish

Current Price: $19.95

Target Price(s): $12.00

Commentary:

Over the past three months, Wall Street's prognosticators slashed their 2003 earnings estimates for ATMI Inc. (ATMI) by 55.6%. Regardless, the shares are now 33.2% higher than they were three months ago and tout a p/e multiple of 449 based on fiscal 2003 projections.

The technical picture doesn't look much better. On December 2nd, ATMI was perched 112% above its September 27th low. Shortly thereafter, the shares formed a double top and quickly refunded 52% of those October/November gains.

Since ATMI is not currently overbought on a daily or weekly basis, there could be a little more strength left in the shares before they finally head lower. If a rally occurs, keep a close eye on overhead resistance at $20.40, $22.04, $25.00 and a three-year downtrend just above $28.  Any of these levels could potentially defeat a rally attempt.

Considering the negative fundamental and technical pictures, this stock will have a very difficult time surmounting the region between $20.40 and $25. Eventually, we expect ATMI to possibly revisit the September 2002 low near $12.

To profit from the anticipated decline, we suggest the June 25 put (Symbol: ASQRE), which is currently offered at $6.80. If the stock challenges the upper end of the region mentioned above, you might be able to pick some of these options up for around $5.



Chart(s):

#1) ATMI Inc. (ATMI) Six Month Daily Chart

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#2) ATMI Inc. (ATMI) Five Year Weekly Chart

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