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One thing that could cut into SH distributions would be the cost of defending lawsuits by plaintiff lawyers who seem to file suit for every corporate transaction. It seems like they would have a terrible case here so long as Red Oak doesn't try to divert any sales proceeds (like charging a hefty "advisory fee").
There would be capital gains tax on the portion of the sales price that exceeds the basis or cost of the assets. No idea what their cost basis in the specimens would be. Seems like it would be at 20% rate but not sure about that.
If CCEL wasn't the high bidder for the assets it follows that they would support transaction. They need to either buy the assets or sell their shares. Voting no gets them no place.
I think if Red Oak and CCEL vote to accept offer, no question it will get approved.
CBAI--Good merger arbitrage opportunity here. PR'd this morning they had agreed to sell all assets excluding cash for $15 million. With 1.3 billion shares out that equates to .0115 per share before taxes and expenses. Seems like SH's should get at least .008 per share of the proceeds plus there's another $1 million in cash. Deal is subject to financing but they took months and months shopping the assets and making an announcement so I'm guessing the financing will hold up. Stock trading at .0045 now so liquidation proceeds should be close to double that.
Looks like .015 per share before taxes and other expenses. Seems like SH's should get at least .008 per share. That's a triple compared to yesterday's closing price. Congratulations to all longs who hung in there even when Red Oak went radio silent for months and months.
I got a few more at 4.06 today and then some later in the 4.20s. When Q4 numbers are announced either going to feel like a shrewd bottom fisher or a real chump??
PCMI Etrade says Q4 earnings to be announced after close today. I thought the date hadn't been announced yet.
As interest rates rise and stocks correct down there will be accelerating pressure on hedge funds and other equity investors on margin to sell and reduce leverage.
10 year Treasury yields spiking to 4 year high on jobs report. Q1 GDP growth expected to be highest since 2008. Fed role quickly shifting to inflation watchdog from growth stimulation.
Bought more at 4.4 on the way down. Look it could test all time low of 4.12 today.
When stocks and bonds sell off around the world I'm guessing the impact is mostly reflected in an increase of cash and reduction of margin and similar credit rather than an active move into other investment classes.
IVFH - Bet Skillz bought back in below $1
Ouch. I thought I was buying some cheapies at 4.81 and they're under water.
PCMI Does anybody else wonder like I do if the executive who left in India is feeding negative information to short sellers in his ongoing battle with the company? If he's stealing customers and employees, knows how much new business they have/haven't won and can cast doubt on the quality of their receivables, it could give him the upper hand as he fights for business against them and be the sweetest form of revenge.
I think an experienced IR person is more likely to be careful about what they say than management team members new to being part of a public company. I'm guessing management will get more disciplined quickly. If they don't report a good Q4, I think analysts will call them out on the impromptu revenue "guidance" they provided on their last call.
Maybe because of the lull between reports this time of year there seems to be little conviction/enthusiasm by buyers. That's my bid at $4.81 which has been hit a few times.
I think average rank is more meaningful
The 10 year Treasury hits 52 week high. Doesn't seem to be a drag on stocks yet except for those bought for yield. Will be interesting to see if NRZ and other high yielders are affected. Don't see why a stock paying a 10+% dividend is less attractive just because the yield on 10 year Treasuries rises above 2.6% unless their cash flow is declining because their short term borrowing costs are increasing.
Dave--Thanks for that color, and it all makes sense. My experience as a public company executive and Board member (especially more recently) is that you say nothing potentially material that's not first filed. As a new public company the POLA management team seems sloppy about this as evidenced on their last conference call by the "guidance" they blurted out for Q4 revenues then fumbled with when pressed by analysts. I'm not surprised they're providing additional color at conferences when asked although it strikes me as being ill advised and more in the nature of hopeful hype than soft near term guidance. Seems a little defensive and desperate after several Qs of disappointing results. Better to under promise and over deliver.
Not many believers today as we touch a new recent low at $4.80. I always wonder if somebody knows something. Assuming not the longer period between reports will at least give them more time to generate some revenue momentum and backlog if they choose in the fling, PR or conference call to refer to any Q1 developments subsequent to Q4 results. They underwhelmed the last few quarters in terms of ramping sales and backlog but have/are building the sales team and expanding "approved vendor" relationships as well as their suite of products. POLA is far from a sure thing but seems like a good bet.
And the VIX is spiking
PCMI Seemed to find a footing on Friday. Up from here?
EGY I have it in PSL. Too chicken to actually invest. Prefer sure things like POLA.
PNNT Not sure if many of you care about BDCs. I like the yield in my IRA and BDCs don't have the tax issues that MLPs do in IRAs. PNNT trading at 6.87 with annual dividend of .72. After getting burned with energy patch loans when oil price crashed, they lowered dividend to .72 and also started to make fewer unsecured loans and more secured loans. They converted many of their energy loans to equity which may be worth something now with oil price rebound. Nonetheless, share price has been under pressure lately, and I'm guessing it's because rise in interest rates may be showing in analyst models to be squeezing their leveraged approach where they borrow at short term rates to boost longer term loan portfolio. I think they would lower/defer their substantial fees before they would cut their dividend so feel it's pretty secure and over a 10% yield. Any thoughts appreciated.
RHE--Bad balance sheet so equity may well be worthless behind debt and preferred but could fly around on speculation of a refinancing.
PCMI--I own and am concerned that weakness may be from departing exec in India working with a vengeance to steal employees and customers and communicating same to short sellers.
Does RHE qualify?
I had to trim much of my stock portfolio to raise money for tax planning at the end of the year. However, I held on to all of my POLA even though their sales ramp up has lagged expectations the last few quarters tanking the share price. They didn't help with the PR announcing the ATT order which didn't manage expectations about the pending disappointing quarterly announcement. Or the CEO sounding very unprepared for the most predictable questions on the conference call. Nonetheless, I think the next revenue numbers will be very encouraging and provide the fuel for a jump in the share price.
CAPC--I had to raise cash for tax planning at year end so liquidated my position at a modest gain. As previously posted I think the low valuation is due to the increasingly commodity nature of the LED market. I think it's difficult especially for a small company to build any brand value to preserve decent margins. Even innovative new products can be quickly copied whether or not subject to any intellectual property rights. Are they really going to sue some company in China for a knock off? If they do, that would be an earnings killer. So margins/prices are under increasing pressure which pressures both the top and bottom lines. They probably have better margins on newer, more innovative products but they also have the associated product development costs. The net result isn't a very valuable, predictably growing or profitable business model. I think the recent PR which promises little is a reflection of that.
The weird thing is that Red Oak is just as stuck as other SHs. They will have to mark at very modest year end value relative to cost--a modest profit during a big up year for markets. No longer anything for them to tout. Don't get it at all.
Sad to say I just deleted the VMC board off my list of favorites for lack of activity. It was a great run for that board and its predecessor on Raging Bull and they allowed me to have some great years pursuing primarily a VMC investment strategy. I'm especially grateful and appreciative to you in the core group that contributed most of the investment ideas and analysis from which I benefited even though I didn't originate many ideas. If you think you might be one of those then you definitely are.
Bitcoin--Advocates of Bitcoin investing consider it a great speculative vehicle because only a finite number will be mined and because there's no underlying intrinsic value for it to regress to--it's only about supply and demand. Obviously, that's not true for Bitcoin stocks which, in the long term, will be subject to the pressure of stock market valuation metrics.
Bitcoin--My 18 year old son invests and thinks of stock investing like many of us might think of investing in Treasuries--not really volatile enough to be worth checking the price very often. I did convince him to sell enough at $14,000 and again at $17,000 so he's profitable and playing with the house's money. As it zoomed up over $19,000, he gave me an incredible amount of (friendly, teasing) sh!t for my "bad" advice. I can't wait until he wakes up so I can take a victory lap. I think this is really valuable investment experience for him.
RIOT is one where you buy out of the money puts which both limits $ downside (you can lose all your money but presumably small investment) and possibility of huge gain if the Bitcoin stocks crash.
Yes, NAP certainly woke up today closing at HOD on 4-5X recent volume. Not sure what triggered the interest, but the dividend yield is still 18% giving room for it to continue to run if the market begins to believe the dividend is sustainable. They seem to be well managed and shipping rates generally are recovering along with global trade, so I'm still holding for now.
PCMI--On the up in the morning then down in the afternoon front, this one tracing quite a bell curve today. I'm over weighted because I averaged down to a 10.22 cost and have a standing order to sell some down at 10.20. Some got off at the 10.20 high today but not mine.
AMS--My worst performer and, based on conference call transcripts, don't find management's hopeful references to additional centers to be credible. They've said for at least two calls now they have great prospects for new centers. Last call they said great prospects but they need company sourced financing. When asked about company sourced financing they said they had some great prospects. Reminds me of: "If we had some ham we could have ham and eggs if we had some eggs." On top of that when/if they do get a new order, it will take 2+ years to begin to generate meaningful revenue. Of course they should eventually get a new order, but nothing on the call sounded like one was close. Their existing centers could increase revenues in 2018 which could cause the stock to bounce back into the 3's, but at this point IMO it's a flailing/stalled growth story. IMO that's pressuring the stock price more than tax loss selling.
CAI--Wade, I like to hear you calling patience though sounds like Trump calling for civility.
TAIT--Took a position at 1.60 and 1.61. Seems like a good IRA stock that pays a decent dividend, has a strong balance sheet and should appreciate long term. Those shares came flying at me so selling pressure for some reason. Maybe sellers are flipping into bitcoin.
If you remember your geometry the looming market correction appears to be asymptotic--it keeps getting closer but never arrives.