Thanks, E Haiken, for your advice. Actually I have never recommended shorting ENER. I have only been discussing the stock as a part of doing my DD, which I am still working on.
My interest in ENER is restricted solely to a near-term situation: tax-loss selling. What the co. does over a longer time scale is no doubt of great interest to shareholders, but it is outside my scope.
If you are aware of anything developing that is likely to lead to news between now and Dec. 31, I would be happy to know about that.
Every autumn I search for small cap stocks, like ENER, that are owned primarily by individuals and that have fallen a lot over the year. That's because they exhibit a predictable pattern of underperforming the market in the last couple of months of the year. So I'm actually not 'late' in considering shorting ENER, but rather I am looking at the right kind of stock at the right time of year.
Maybe the tax loss selling effect won't be very strong this year ... I don't know. Overall, there might be less of it than in 96 and 97, since the market isn't up this year and many investors don't have gains that they want to offset. That's why I was asking whether ENER shareholders are selling to capture the tax loss -- I'm curious whether they have net capital gains for the year that they are tempted to offset.
BTW, ENER does have $2 per share cash, so that is the approximate intermediate-term floor for the stock price.
Of course they burn cash at the rate of about $1 per share per year, so the $2 is not a hard floor. There are a number of debt-free companies that trade below cash primarily because they burn cash and the market anticipates the future cash level.
Sorry, but tax-loss carryforward is of no interest to me ... I research a lot of development-stage companies, and I know what I'm doing when I look at a company's liquidity situation: cash is the only asset that interests.
Best of luck. |
