Artie,
Basically, I believe what we are seeing, in the heavy trading, is the Underwriters either, trading stock they have held back from the Secondary Offering, or trading the 187,500 shares they have an option on. They can trade in a way that controls the price of the stock until the market absorbs the 1.25M+ shares of the Offering, plus the optional shares, without the price going like a yo-yo. There was more demand for the stock, than was available in the offering--so I think what they have achieved, and continue to achieve, is a slow increase in price, during these periods of heavy volume. Had they not done this, you may have seen a run up to over 15, a sell-off to 12, and another run up and down. I spoke to one of the Brokers today at the Underwriters, and although he didn't say they were controlling the market--when I asked when this heavy trading would fall off, he said "probably about Wednesday." Tomorrow is the settlement day for all shares purchased in the offering. Don't worry about this stock being up so much this year; it has a long way to go before the price catches up to the value. Remember, not very many realize this stock is undervalued; it has a negative P/E, and (appears to have had) a negative third quarter. If I didn't know this stock, and just looked at the numbers in the IBD, there isn't anything that would attract me to it. I see a steady climb in the price, with periods of acceleration as the new earnings estimates draw attention, and again as we approach the announcements of the actual earnings. Again, all of the new earnings estimates should be out within a few weeks; I'll check to see how often the IBD updates its numbers (the IBD is still at 0.29 for the quarter and 0.85 for the year). First Call is now at $1.25 for the year but the IBD hadn't picked it up yet.
Buzz
Buzz |
