Legendary short-seller Jim Chanos made news on Wednesday when he assessed Hewlett-Packard Co. (HPQ) as a short candidate. He claims that in the wake of an Apple Inc. (AAPL)-led movement from personal computers to mobile devices, companies like Hewlett-Packard are in trouble. Mr. Chanos is concerned that Hewlett-Packard will refuse to age gracefully and instead will acquire other companies in desperate attempts to acquire lost market share.

This prognosis is actually very useful for value investors, who can use the symptoms of this condition to diagnose value traps by recent financial performance.

Out-of-Favor Apple Casualties

There is a long list of companies, which Apple’s mobile devices have displaced. First and foremost is Nokia Corporation (NOK). Adding insult to injury, after multiple versions of the iPhone, many would call many of Nokia’s old products “dumbphones.”

Next is Research in Motion Limited (RIMM). This company is letting go of a third of its employees and closing down several production sites. Management even consented to selling its nine-passenger midrange company plane as part of a plan to eliminate $1 billion from business costs. The company hopes to sell the jet for $6 million or $7 million. This sale is part of an effort to cut down the operating budget as BlackBerryes become less popular and lose sales.

Firms in Microsoft Corporation’s (MSFT) Windows-based PC industry are also scrambling to redefine themselves as PC sales stagnate. Dell Inc.’s (DELL) interest in Quest Software, Inc. (QSFT) demonstrates that the firm is looking to bolster its database and server businesses.To continue reading, click here.