GUMM.
Ron,
I sincerely appreciate your comments
You make a good case about the probability of buying below 12 if big news comes out overnight. I have been holding most of my position for four months so the opportunity cost is sunk and can't be recovered. I think the move will happen sooner rather than later and I'm willing to forego the opportunity to employ my funds elsewhere for what I'm betting won't be much longer. This is a judgement call and I might be wrong but I think most of the opportunity cost is already lost.
I'm always concerned about insider selling, and I investigated each of them to try to find out why they sold. As you know, people sell stocks for many reasons, and sometimes the reason has no negative implication on the company. Mr. Bernstein sold GUMM and is listed as an insider only because he received stock from his brother, a former GUMM Director. Neither of the Bernsteins have been involved with GumTech for well over a year, and one could make a case that they don't know what is happening in great enough detail to have sold for fundamental reasons. Mr. Boone, a current Director, sold for a reason that I can't post because I would be invading his privacy. I assure everyone that his reason for selling is unequivocally unrelated to GumTech and I'll just let my word stand on that.
Most of the negative things that can be read on the Yahoo bulletin board are posted by one or two short sellers who have been caught using multiple aliases. These people talk to themselves from post to post to give the illusion that somebody agrees with their negative spin. I have tried to get these aliases to address specific issues but my questions go unanswered. They continually dance around my questions and deviate on tangents and never specifically talk to the issues.
It's very easy for an anonymous alias to make a general statement such as "GumTech's financing is bad for shareholders". I posted several specific reasons why the terms of the financing are favorable to shareholders and asked anyone to tell me specifically point by point what is bad with the financing. I never got an answer and about a week later the same alias again posted "GumTech's financing is bad for shareholders". The same alias said "GumTech's management is inexperienced". I posted several specific reasons that demonstrated that they are experienced and asked for comments. I never got an answer. In general, the short seller talks in vague generalities and ignores you when you post something in great detail that pins them down and forces them to answer something specific.
The short seller(s) on the GUMM thread at Yahoo have stooped to lower levels than I have ever seen on a public message board. They have lied about what is happening at the company, lied about deliveries "pallets" of product to retailers, lied about where they work and what they know, slandered GumTech management, and slandered Gunn Allen (a major market maker in GUMM), to name a few. This isn't to say that there isn't risk in GUMM or that one can't find anything negative in the company. It's just that the negative spin you read on Yahoo is so exaggerated and full of lies that you have to discount most of it. One could also reason that if they have to lie so much, they are simply trying to cover the truth, which is mostly a bullish outlook.
Thanks again for your comments. Your unbiased look is highly respected.
Dan |
