I am not too sure how "liquid" Mattson stock is in the mutual fund money inflow universe. A lot of funds cannot even begin to think about Mattson simply because they have to invest a minimum of a million dollars in order to have a company represent 1% of their portfolio.
Lets take a look at an example that I pulled more or less randomly. The PBHG Small Cap Value fund might seem a good candidate to buy into Mattson. Their assets are $117 million dollars and their average holding in any one company is $665,000.
Now, interest in MTSN is at an all time low, and we pretty much bounce around at about 70,000 shares/day, which represent little guys like you and me looking for a screaming deal or finally throwing in the towel. Take a look at the volume and price chart and you will see that on days when volume picks up, their is usually quite a swing in price. A good example is Friday when we were double "normal" volume and went up 15%.
So our fund manager decides to get into Mattson. She needs about 100,000 shares, and pow, she just sent the share price up another 10%. Also, note the characteristics of her fund, it is pretty tiny as mutual funds go, so her fund is one of the largest that can buy into Mattson without the share price getting totally away from their entry level. Her pal in the next cubicle running the PBHG Emerging Growth fund with about $1,200 million assets cannot include MTSN it its portfolio because it needs about 500,000 shares of MTSN to make a difference in its portfolio. That kind of volume usually moves MTSN about 40%.
So anyway, of that $5B-7B flowing into the markets, only a small number of those managers would even dream of buying into a $80 million company. Of course, I guess it only takes a few of them to buy in and then we are back into happy territory again. |
