>>About 2: Though there was "no sign of a squeeze in sight", does not explain why covering is happening now . If, as you contend, Iomega is such a no-good, bloated, hyped, overvalued hog of a stock - fated to be outdone by any company that can figure out how to spin a disk - why not ride it down to zero? <<
I believe I've addressed this issue numerous times, and here are the numbers to back it up. The main reason the stock has been stuck here at 14 1/2 for a week now (and hasn't really moved any lower), is because of shorts covering in anticipation of the pre-earnings sucker rally. This looks like the bottom for now, so when the rise to around $18 happens April 17, the bears can pounce and sell short again at a higher price, and drive the price down to the single digits.
It doesn't take a rocket scientist (or a Harvard Business Grad. for that matter) to figure out this strategy. Just look at IOM's chart since it's decline from the 20's, and notice the sucker rally intervals. Brain-numbingly easy stuff. The recent coverage by the bears is testimony to the ease at which it is to cover 1.5 Million shares, and not raise the price appreciably. This doesn't speak well for the bull's position at all. |
