CHARD is a fine specimen in every way, except the spread.
The reverse split is the immediately compelling thing about shorting the stock. Stocks drop so rapidly after a reverse split that if the stock is shortable and trading costs are reasonable, you will have a very high probability of making a good scalping over a few days.
If you are interested in shorting it longer term, I do see a few factors of real interest: they got a going concern from the auditor in the latest 10k, and their operations are primarily in Kazakhstan.
Kathryn Staley's book mentions that one of the profile for possible scam stocks is when the operations are all far away from where shareholders can see them. You can hardly beat Kazakhstan on that count. Who knows what exactly CHARD owns, or how certain it is that they really own it, or how certain any information about it can be.
Another nasdaq 'oil' stock that fits this profile is AIPN, which has an active thread on SI, with true believers battling shorts and nay-sayers. AIPN is also primarily in Kazakhstan, and otherwise has little to be said about it except a really badly broken stock price and a bad balance sheet, like CHARD's. In fact, you can bet AIPN will reverse split in the future because they have been trading below a buck for a while.
The warrants, BTW, are not much of an issue, because they amount to only a few percent dilution and most of them are way out of the money.
BTW, I love the symbol CHARD. They couldn't have come up with something more apt if they had tried. |
