Luxor afficionados:
The question on everyone's mind at present seems to be "Is today's AGM going to be a significant event?". Well, let me assure you all, the AGM today is almost certainly going to be its alter-ego, or, a non-event. Directors will be re-elected, auditors will be named and everyone will go home. Disappointing? Not when you look at what the stock is telling us.
Judging by the stock's trading pattern over the last couple of weeks, LRL seems to have entered into a classic accumulation phase. The company has issued no news of any significance in quite a while (certainly not enough to justify a CAD 2.50 price in the stock) and, when called, are more than happy to give you the run-around with vague comments on progress and corporate events. Meanwhile, the stock is showing surprising strength and support where this steady accumulation is occurring. More surprising to me, and people who know this story better than I, is just how little stock has come in for sale recently... That's the sign of a solid, tightly held stock.
A key element in all this mishmash is the coming issuance of those mysterious options at CAD 2.50 (the highest option price ever in Luxor's history) and the equally mysterious appearance of a block of stock nearly equal to the amount of options at the same price. The general consensus is that these two events are related in some way. I believe things are being put in place for an upcoming transaction(s) which will move the stock to a higher level while 2.50 becomes the new floor.
The little solid information I have been able to dig up coupled with what seems to be an orderly accumulation of stock below 2.50, gives me a VERY positive feeling for this story. I am not sure exactly when the announcements will be made to justify this price level (and quite possibly a much higher one) but my guess is that it will not be long, possibly just a matter of weeks. In the meantime, don't be fooled by what you see or what you don't hear. Don't be put off by today's non-event.
In general, do not sell when people in-the-know are buying.
IMAL |
