Hi, Al,
The shorts (I am one) say SRCM is a bad company because they have driven their stock price up by hyping the future potential of the company. The shorts think the company has very bleak future prospects for new business outside of its IT business. The IT business by itself is unlikely to come even close to paying the interest on the debt the company incurred. Thus, we see this as an eventual bankruptcy.
Of course, the longs disagree. But, the important thing to realize is that anytime short sellers appear on a thread presenting detailed analysis, you should be very reluctant to go long that stock. Make sure you are certain of your position, because the likelyhood of there being real problems with the company are much greater. It is often easier, and in the long run more profitable to just buy companies where there is no controversy.
Remember, they call it a con game as a short for "confidence game." Meaning they gain the trust and confidence of those they swindle. And those being taken advantage of are often the biggest proponents of the game until it completely blows up in their face.
BTW, Auric is one of the most respected short sellers on SI. Check out his thread.
Regards,
Archer |
