Bill: Thanks for posting the story. Here are some comments I have about the story. Let me know your thoughts as well.
>True, the company has been in the red in the past four years, and sales are just nearing $10 million--up from $4.8 million in 1994. But it's in the throes of breaking even this year--if not jumping into the black, says the hedge fund manager <
BREAKING EVEN!?!?!?! First Quarter this year came in WORSE then expected and lost more $$ then same quarter previos year and the previos quarter!! Where does BW get that Idea from????
>Little-known Opta Food Ingredients (OPTS) is getting to be quite visible to major packaged-food companies and even McDonald's <
Last Quaters earnings ( or lack there of ) statement said they had lost a major customer. Wonder who that major customer was?
>He notes that French giant conglomerate, Compagnie Financire de Paribas, has taken a 12.7% stake in Opta. Paribas first purchased 531,900 shares in October at 7 1/8 a share on the open market. In December, it bought 854,771 shares from Pfizer at 8 1/2.<
Shares were bought before the last 2 (worse then expected )earnings reports. Now they can get out and break even. There is the potiential of 1,386,671 shares being sold.
>He thinks the stock, now trading at 5 3/8 a share, is ''an easy double in a year's time--with or without a buyout.'' The downside risk, the manager adds, is minimal, since the company has net cash of $3.50 a share and $2 a share in tax-loss carryforwards.<
WAS at 5 3/8 till the BW story was leaked and then came out. At 5 3/8 as they stated on the story, the company might be a good long term hold and hope but at $8.00 plus its a differant story!
The downside risk at 5 3/8 is probably somewhat minimal, but again, at $8.00 plus the downside risk is major and the upside potiential has evaporated away.
>BY GENE G. MARCIAL< He picks some good stocks for a nice one to three day play caused by his stories for business Week, but those stocks always sink on profit taking after just a few days. Some drop below were they started before his stories in BW, some drop to close to the price before , and once and awhile they drop to half the price before story. ALL of them that I have seen, DROPPED after a few days of hype from BW.
Differance here is that the stock was moving up strong on low volume for 4 days before the story came out on Thursday night. The story had to been leaked out as there was no news of any kind to cause a small number of people to buy the stock at any price.
THEY, all 97,900 shares traded on the four days leading up to Fridays move, are potiential sellers with a nice profit!
Add in the 333,800 shares from Friday who will be looking for a quick out on their hopefull short term gain, plus the MANY MANY shares bought over MANY months time at much lower stock prices and you have the potiential of Millions of shares being SOLD on Profit taking. |
