Failure of MESG to move more than a buck-fifty on the Yahoo! deal has deflated my enthusiasm. MESG appears to be suffering from many ills. Among these...
S-3 filings indicate insiders sold 408,339 of 7,063,015 shrs between 2/1 and 6/18. MESG still has a sizable overhang.
Institutional buyers do not appear active above 17. Price will probably have to fall below 16 before 10,000 shr BUYs happen in quantity. Today, eg, I only saw one 10,000 shr or greater trade an it was a sell at $17.97.
I also imagine short selling helped beat MESG off $20 and aggressive covering has yet to show its face. Another reason to expect further down slide.
Other things hurting MESG is no analyst coverage and meaningless -- that's right Larry, I said meaningless -- PR that gives little direction towards earnings or extent of signee commitment.
Until these points become clearer, I suggest caution when buying MESG at these prices. Anybody who rode this puppy to ground in June knows what I'm talking about.
The good news is, MESG has a greater chance today of bloodying the shorts and catapulting price once again above 20 in the process. But I want to be clear, it will be a test of who gives first, the shorts or the longs. |
