Did essentially the same thing on ATY. Sold half yesterday at 18.80. Thought I would cover myself a bit.
As for YF, let me clarify about managing the stock price. If you look at AMZN, they are notorious for playing the investment community to their liking. Just when the hype starts to get thick about how AMZN is overvalued, going to see competition, growth slowing etc, management comes out with another press release or something to kill the infection. The timing of their latest stock split announcement was no accident - the stock blasted off once again. Both ATY, MSFT and countless other companies do the same to a lesser extent. AMZN is a pro.
Back to YF, I'm not saying they should be hyped until they get way beyond fundamentals. Still, management could do a lot to ease fears the market has etc. but they haven't. The Kmart thing is an example. Who here knew about that deal??? ATY would have had 2-3 press releases out with frequent updates.
There are lots of companies that just don't seem as finely tuned in to how they benefit from a higher stock price. Some co's speak of nothing but "shareholder value" etc. Others seem to just view equity as a means of cashing out.
Lower share prices hurt in many ways. For example, if YF had a stronger currency (their stock), they wouldn't be paying for EPIE with new debt, they could offer shares instead - but they can't. If they want to do lots of aquistions, especially a big one, they'll have to work to get the price higher, otherwise they're stuck. And, that debt interest is deducted from earnings too. Gulf(GOU) and many other companies have had much the same problem. You can't be a player in takeovers without a strong stock.
As for what I do, I work for an arbitrage fund (read very short-term) in Venezuela, but that's strictly US and Venezuelan stocks. My personal stuff is longer-term but I'm always flexible. Sooo, I'm not interested in YF as a trading stock, more of a long-term play. Just not ready to pull the trigger until I feel out YF's new direction. |
