I may have found the culprit for this decline that noone has mentioned, and this information is BURIED, believe me. The company just ended a lockup period from the Secondary Public Offering of March 2000. For a period of 90 business days from March 21, 200, the date of its commencement, the filing S-3 states the following, and I quote:
sec.gov
"For a period of 90 days after the date hereof, the Company
will not offer, sell, contract to sell, pledge or otherwise dispose of,
directly or indirectly, or file with the Commission a registration
statement under the Act relating to, any additional shares of its
Securities or securities convertible into or exchangeable or
exercisable for any shares of its Securities, or publicly disclose the
intention to make any such offer, sale, pledge, disposition or filing,
without the prior written consent of CSFBC except grants of employee
stock options and issuances of common stock pursuant to the terms of an
employee benefit plan in effect on the date hereof and issuances of
Securities pursuant to the exercise of such options or the exercise of
any other employee stock options outstanding on the date hereof."
Therefore, it is entirely possible that the company is selling, or is intending to sell OR that the perception is that the company can sell and will do so. Perception is a powerful entity. This is a heavy weight on any stock coming out of a lockup period. That day, if I have calculated correctly, was Friday July 21 at 5:00 p.m., and thus the lockup period has ended for SSTI. This may have been the negative that we all missed, and an explanation for the recent decline on the heels of an amazing earnings outlook.
If this is true, that the perception is there, then I would load up here in the $70s. Daytraders usually know these little details that most of the rest of us overlook and they will sell ahead of this occurrence, anticipating a decline. Meanwhile, real investors are perplexed at such action and can't find a reason. Many will sellout and thus you have the climactic selloff. They'll be hitting themselves when they learn of this. I do not see the company selling shares if they were so bullish as to call for and approve a 3:1 split while the stock is trading under $100 and with such an amazing earnings outlook. It may be the last time we see such prices in this day of a high volume climactic selloff.
JMHO,
Miller |
