To All thinking of MFN: A Story (about Dead Cats...)
Last week, many may recall the saga of XLCT, which, upon stating earnings of 02-04 cents (below "analysts" estimates of 11 cents, but still a 40% increase over the previous year's quarter) tanked, from around $24 to $8.
The parent company, INEL (which owns 80% or of of XLCT) also received a haircut.
As a part-time bottom fisher, I thought both stocks' declines a bit of an over-reaction, so (in a rather bold and wholly unanticipated move) I bought XLCT right before the market closed, @ a smidgen above $8.
Well, to make a long story short, while I had the right idea, I got on the wrong dead cat, so to speak. The parent company, INEL, jumped up in after hours trading, and again on the 27th of Jan. (the next trading day, a Monday, where an investment here would have netted a quick 25% or so), while my cat sunk even further, to $6.75. Although it briefly recovered to $8, I jumped the gun and bailed at $7.25, for a quick loss of around $1,500 (okay, it was a little bit more, but I'm still in the denial stage...)
The point of all this? Quite simply, dead cats don't always bounce. (XLCT is still in the $7.25-7.5 range.) And with a company hurting as bad as MFN, I believe there are safer short-term havens for one's money. As always, just my opinion...
And for those of you who have already invested in MFN: I'm *not* trying to freak you out. Ignore this post; I don't know what I'm talking about. (Seriously, though, I'll be the first to congratulate you if you make money on this stock! Good Luck!)
regards |
