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Biotech / Medical : SNRS- Sunrise Technologies -- Ignore unavailable to you. Want to Upgrade?

To: BARRY ALLEN who wrote (2686)	7/14/1999 12:26:00 PM
From: Joe	Respond to of 4140

Barry, lets have a little fun with numbers for the benefit of the Avalon Research and Sturza Institutional Research customers. The Sunrise press release on the Sturza report was June 11. Looking back at the price/volume action, the heavy shorting started on June 9; the high was 13.025, and the close was almost the low, 11.375. The average volume for the preceding 6 days was 305K shares and on the 9th, the volume grew to 835K. The price took a down hill slide from there on growing volume. Sturza and Avalon were able to drive the stock down to 9.5, the lowest point on 6/24. Avalon has 1.6M shares short and lets assume their average short sale was 11.25. The question is when did these folks figure out that they had done the wrong thing by shorting the stock. Probably they were starting to worry mid- to late June but the big time covering occurred when the option volume exploded July 7th and the share volume blew up as well, to 4.7M shares. The result of left over fireworks from the 4th, I guess. Covering probably started on the 6th since the share volume was more than 2X the previous day and the stock closed markedly up at 14.375. On the 7th it closed at 16.5 on over 2X volume again. Lets assume the average cover price was 15. That, it appears to me, to be a loss of approximately $6.4M to those with accounts at Avalon. And that assumes they have all have figured out that they made a mistake and moved to correct it. Now what about all the accounts out there where the losses by the those that believed the words of Sturza's Medical Research analyst Stephen Sabba and shorted the stock? At the beginning of my post, I said 'lets have fun with Avalon and Sturza customers', I meant fun and profit. I, for one, took advantage of the stock they were selling and added to my position all the way down. It seems the shorts were playing dirty pool but some of us longs profited from it. I feel a twinge of guilt because I know that a lot of people were financially injured by their little game; the investors that lost their position because of stops, those that got margin calls as brokerage firms changed the margin requirements, and the weak hands that sold. Those that could afford the paper loss weathered the storm quite well and some of us took advantage of the havoc. Regards, Joe