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Fuyi,
Very good strategy. I am actually happy to see the traders start getting in. Looks to be some TA traders also. I will now watch for awhile and see how we go. Welcome!
Now what we have here is what RJ said yesterday sans volume. Watch EDGX when any buying volume shows up. Boom right on to BID. ARCX is the screen. However, they will have trouble now as there just isn't the volume and until the traders make a move they have to figure out whats next. Very low volume so far but don't fall asleep on these guys yet.
EDGX has been the Ax for the last two months but has really stepped up since just prior to the merger. Today would be a perfect example.
BxA 1.61-1.63
EDGX 1.72
Buys start coming in, sells diminish, he jumps up to 1.64-does not move until other MMs capitulate to 1.63. He did this all the way down to 1.57. Soon as all those sells came in at that level he retreated again.
ARCX was a big shorter at the 2.40-2.50 level. My guess is this was after the knowledge that the stock was going to be taken down.
NSDQ/ARCX have been fronting for EDGX depending on where EDGX wants to go.
All TA has been useless. This has been something totally new and could probably write a paper on this one. The only true indicators I have been able to currently latch on are volume, Buy-share trade data to match who is doing what. I agree that this has kept the traders out until they get faked on that bottom.
AMEX/NSDQ are intermittent buyers but not that big.
Another thing I have noticed the last two days is that EDGX will flash a big number on B or A and typically within a short period of time he ends up on one of those and the big number disappears with no time and trade to match.
Just some added info for you.
RJ
In many ways if the retail investors went away for two days this stock would probably capitulate and we could get back to normalcy. I have seen buyer after buyer get torched with the "false bottoms". Right now this sand box is totally controlled by EDGX. Their rules, Their numbers. If you notice every time he comes off the ASK this thing starts moving. However, he will crush it if there is any movement. Personally normal market ax. The problem is that behind all of this is a well controlled sale of about 3.5-4M shares IMHO. If my numbers play out right we are still a couple days away from cleaning that out. We shall see.
Imagine that another 280K late after hours. LOL Anyone here seen that recently? I am a short term pattern guy and like to see if I can pick some type of "trend" on a particular stock. There is no crystal ball theories here, I am a keen observer of the obvious though.
11 Trading Days since merger:
When the volume is higher than the preceding day the PPS has closed lower. (8xs)
When the volume is lower than the preceding day it closes higher. (3xs)
Useless dribble I am sure but just another cycle I am waiting to be broken before I would say bottom has arrived.
OWK2
It is interesting that you mention SAMPO patents. That is one of the potential game changers for me in this stock. If they can establish a precedent with 3 or more companies then I think it is a matter of time before you start seeing big names. I think the company has kind of "framed out" the house and now I am hoping to start getting some siding to make it look more like a structure. They have proven they can monetize and I am not sure they will get any pop out of additional licenses at this point. Now a SAMPO settlement might get a little more attention IMHO. Cheers!
Volume still too high to signal "financial investor" selling done. I know everyone always looks to average down and that is a good strategy, this stock is going to fly back at some point but I would look hard for a solid turn around before thinking you can out smart these guys. What is .10 on the upside really matter at these levels IMO. I have personal experience of 50K trades that get broken up and buried and the only thing that happens is down tick. LOL As I have said since the beginning, invest on DD and make your own calls. With 58 trading days left before Markman you need to evaluate potential for run up based on information available. If Novell falls then I would say we have a rather interesting time ahead of us.
This is exactly the type of info that is critical to new investors in the IP sector. I have been a fan of MARA and absolutely plan on taking position in the future. I have said from the beginning that this company has been doing all the right things. I have reams LOL of DD on this company and will be along for the ride at the right time (for me). GL
EDGX
Has set the line from 1.61-1.64 and shows little inclination to move except when someone wants to buy lower. Also per my post a few days ago:
Average Trade Volume is 505 and as we can see it is RED.
Stockpickr
You prob have L II and the ONLY MM you need to watch is EDGX. He sets direction and price and has had total control of this movement since 7/1.
RJ
Until that volume decreases to under 200K in the first hour the "financial investors" per CC yesterday are going to drive down. I would not load up until lower volume and one day of settling since MMs will figure out what they want to do once selling stops. On the good side there is only 59 trading days until Markman hearing, so back a week or two out for pre-M run-up and this is not long in the tooth. I also hope company holds any news until this is over, as it would be just a waste of powder. JMHO
Cooler
Forever the poetic approach. LOL I truly have no worries and since I have been pounding my DD on other stocks it just came to my purview when looking at calculations. Another "fact" of note is to understand that Frost Gamma, Iroquois and Alan Honig all had a decent amount of Lexington that would change into DSS shares (I am not doing the math-late over here on the right coast) post merger, they are not listed at all tells me that that number also would be added in to the equation. I have a number (SWAG) in my head but will refrain from posting as the company is moving forward and will not materially change anything.
Post,
Now I may be wrong but perhaps you are better equipped than me to answer this one.
Hudson Bay was scheduled to get 3M+ shares of preferred stock. Now they already were at the 9.99% level or very close with the common stock post merger numbers. That 3+M .02 warrants would pose a problem regarding reporting for sure and probably other things as it would put them over that 9.99%. I know from experience that companies like Hudson do not like that regulatory guidance and they are normally well under that limit in deals like this so as not to have to open the books. PERHAPS and I am saying pure uninterrupted speculation at this point, maybe that 3+ million shares are finding their way to the market so as not to go through that 9.99% ceiling. This may be totally FUBAR but would like to see your thoughts.
AKA Financial Institutions:
"We now have found on a post- merger basis that we have a bunch of what we call financial shareholders who really don't have a long-term interest in the company that their simply to be taking a short-term view and selling your stock mercer for down to ever increasing lows"
In case you want to read CC vice listen:
http://www.earningsimpact.com/Transcript/81891/DSS/Document-Security-Systems,-Inc---Document-Security-Systems-Completes-Merger-with-Lexington-Technology-Group
Well looks like the officers of the company were ready after the CC.
Nice to see their shares finally registered.
Debt vs Cash
Cash $7.325,000 (Post Merger)
Building $1,165,106 ($8000/mo)
Equipment $850,000 (One year loan at $71,000/mo)
Total Debt is made up of hard assets: $2,015,106
Notice the excitement in board members talking about 3Q reporting. Even Bob Bdzick who is about the most underwhelming guy perked up about 3Q now that merger is done and IP comes into play.
There are some smaller items that may come in play down the road but don't see any of them hitting in next 6-9 months.
Conference
Here is the link and i would just concentrate on when Fagenson speaks and Ronaldi.
Fagenson has opinions on share drop
Ronaldi talks about structure and "full" pipeline of opportunities to purchase operating IP.
Since SA author Kim was on call I would expect a SA article coming up soon.
CC listen-in link: www.investorcalendar.com/IC/CEPage.asp?ID=171177
If you had any doubts about what has happened to the PPS, you shouldn't now. I thought Robert Fagenson was candid, clear as he could be and you now know it has nothing to do with company fundamentals..
Maybe
You might hold one more day before you make that leap. Watch the last 5 minutes before coming to the party. IMO
dscot,
Normally on my Sunday Rants I just put up what is in the door regarding anything DSS has on the table. Not really meant to infer good or bad, just a little line in their last quarterly that I probably used the wrong word (seminal) and just wanted to infer it would be a positive catalyst (at least equal to BVSN settlement) in the upcoming quarter. They got the smack down from Europe and that is what you get when you hire a French Law Firm. LOL
I want only one thing...Tell me about revenues coming up this quarter. Asking why the PPS is where it is when they did absolutely nothing except complete a merger, or asking about pending settlement litigation when they cannot talk about it is not a good use of time. IMO
RJ
It has hit this 1.68 and always held. I bought at this level a few days ago. I threw my TA out the window and just figured there is absolutely no bad news on the horizon and today will confirm that. As far as support, I can tell you my charts had 10 different levels from 2.92 and we obliterated every one and didn't even wave going by. LOL
CHP
I have two separate L2 screens that have time and trades for entire day. Sure some of those trades are 100 shares but in my very humble opinion they are just part of a larger order broken down creating "trade" volume/activity. A perfect example would be NSDQ sitting on the bid with an order to buy for 2500 shares. If you watch the transaction side they have 10 trades for 150 which just so happens to equal the number on buy side. A more realistic picture that I use is taking the total shares traded and divide by number of trades to give me average size of trade. When DSS was trading lower volume, it seemed most of the time (NOT ALWAYS), the stock trended up when that number was in the 350-375 range. Every time that number was higher than 400 we seemed to go down. We have been trading in July with the average between 450-490. Coincidentally we have gone down every time. JMHO.
We are kindred...
I think the support turned and became resistance. Every original indicator from 2.6 down was blown away. I am trying to also redraw from a TA starting point. I am hoping that this cc will define the company in clearer terms. I am also hoping to create and get to a trading range in the 350-500K level. That will allow TA regarding this stock to take effect better. To me this needs to break above $2 and get back to that $2.50 level to have real legs. Hopefully news will start propagating out of the company.
Scheduled a week ago to address post merger issues/direction.
MARA Future
First let me start off by saying I have absolutely no anxiety regarding an R/S. I just am not sure that will be the route they take for up-listing. My current estimation would be a 1-9 R/S to get the $3 minimum requirement for AMEX listing as this would be easiest uplist. You then have market cap requirements which are going to be difficult to manage at these levels without further institutional investments. To me a merger with currently listed company is much easier route. (It would still include R/S). A wise man once told me follow the money and figure out how to get in the middle of it. Although I normally would never mention another stock I am tracking, I can't help but notice the striking similarities between DSS and MARA. We have basically the same funders (IPNAV-Hudson etc). Now the component missing here right now is an "operational" arm. Yes they are licensing the IP but the company itself is not using it with any of their own products. Those that have bought at these levels seem to be fine and will just have to wait a while. I will go back to lurk for awhile and wait for some more clarity on which way they may go. GL
Shares
I am curious as to why the company has kept such a tight limit on shares. I see there are about 6M shares and the insiders own about 1.2M. This prevents basically any institutional ownership of the stock. I guess cash is not an issue but owning at this price is tough. I have a lot more DD and normally I am trying to figure out why a company has issued so many shares so this is a strange situation for me. Thanks in advance.
Sunday Night Rant...
I thought I would utilize this opportunity to try and talk about and get input concerning a myriad of issues. I think we can put the PPS decrease to rest and in MY opinion only we are pretty much at the bottom. (1.75 should be support). This event had no underlying fundamental event attached with the exception of some share dilution. It actually should have been less due to the fact less shares were put on the market than originally thought. There is no doubt an insider/institution was selling and it is time to move on.
The ECB appeal was heard back in April in Spain regarding the suit brought by DSS. (DSS won original case). The ruling was supposed to be released 2nd quarter but no answer yet. This would be a seminal event for the company if positive ruling. Any thoughts from legal experts very much welcome.
Company HQ move: Maybe not that important but I think this will go to where the real decision making power is. Per the new charter; “No approval is required to change company HQ, whether in or out of current operating jurisdiction”. Since the CEO and COO are in Mclean VA it would seem that Rochester, NY is not the place of choice.
As I have pontificated in the past I see absolutely no reason for DSS in its current state to continue operating the way it is. I actually was taken aback this weekend by the cost of revenue in plastics/packaging/printing. Even though the % of revenue went up, the costs followed right along with it. The new DSS is a technology company and the legacy businesses are just a drag on revenue. The company will be an “operating” company by virtue of the new authentiguard product. The fact that it now contains technology from Bascom/Virtual Agility/DSS marries all the companies together.
The Novell settlement will be the biggest litigation piece going forward IMO. This would be the third company to admit infringement and create a precedent the court just can’t overlook. As with most cases such as these, prior art is always the argument and whether there was enough available to argue for the defense. The interesting part is that the patent was applied for back in 2001. I can tell you that back at that time there was very little available as far as social networking. Back then Netscape and AOL were the kings. This could get very interesting after that.
Funding Round: I think this is coming. The new DSS needs to purchase IP that generates revenues. It also has to get this new security product out to the market. In the past Jeff Ronaldi stated that he did not need to dilute stock, that he has plenty of financing available. One obvious target to me would be Virtual Agility. If you take their 7% stake that cost $2M then that would place this company value between $25-$28M. This to me would be a main target. Even some type of incremental acquisition would work well here.
My final comment will be that DSS now has to define their model to the street. Using the term ‘hybrid” is nice but that can mean anything. I know, I know all the definitions and what that connotes but the fact of the matter is we currently have Printing-Packaging-Plastics which have nothing to do with IP. They also “currently” contribute nothing to the new product. There appears to be a niche for them if authentiguard takes off but I think it is just cheaper to contract out.
One of the greatest things I believe started happening immediately is the constant issuing of stock to officers of the company will cease and desist. DSS was just plain horrible. A stock that had no insider buys (they didn’t need to!) is just bad business. I will say with pretty good confidence, Hudson Bay will effectively stop that going forward. The days of stock based compensation costs of 247% are hereby gone.
As always, these are merely discussion points for the board to consider in the upcoming week. GLTA
Perfect Storm
The shorts actually have the perfect stock at the perfect time to cover. No threat of R/S. No major news pending. Merger approval probably known ahead of time. Selling originally into merger approval but then taking total control at the 2.50 level. This worked out perfectly. I just have to believe they have to run out of steam somewhere near this level. With so much upcoming news I am sure they are very happy and made some great money. I can't be mad as that is the market.
Boston
All day long EDGX sitting like the grim reaper at 1.74!!!!The Ax is the king here brother.
CHM
Even if a stock received a "de-listing notice" the company still has at least 3-4 months to rectify the shortcoming. I am willing to bet that was addressed immediately to AMEX after R/S not approved. I applaud DSS management for probably seeing this coming. This thing has many many catalysts forthcoming and if I were them I would clean out also. The good thing is on next climb up we will have a smaller short position (which was up to 10% in June from 5% in May). I think the "purge" was needed either way.
Boston
I never try to outguess the market but based on volume the last two days I would say we are pretty much there. Of course I probably jinxed us but no way this should have been dropped this much on that type of short. However who knows how many "Nakeds" are out there since we have been on threshold list for a month and a half.
Apologies.....
Gents it is raining here at the beach so I am just posting information that I hope is helpful to all. Sorry about so many today.
For Comparison:
These are Float Numbers.
PRKR: 84.6M
VRNG 82.3M
WDDD: 82.6M
MARA: 51.6M
VHC: 51.2M
ACTG: 47.8M
DSS: 38.3M
I'd say we are looking pretty good here. Even with the $5 Claw we are under all these stocks.
Cooler 100% correct I just didn't add in.
Share Breakdown....
The nice thing is I have already identified my next IP play and I am just going through DD side by side with both. The next one is going to be much easier. IMHO
O/S shares per 13G filed today: 45,367,875
O/S shares DSS Common 6/30: 21,708,555
Newly issued shares: 23,659,320
Escrowed shares in that issue: 7,100,000
New Float: 38,266,942
Warrants: 4,859,894 if purchased can execute at $4.80
Warrants: 3,432,170 @ .02 If Beneficial ownership is 9.99% or higher of common.
Hudson Bay needs that 7.1M to get to that 9.99%. Can you imagine 3+Million more at .02 when the stock is at $5? They are making sick money but not until that level.
Now this is just the basic numbers for those who are interested. There are little options here and there but IMO will have no major impact on any of the above.
Please feel free to chew on and correct where needed.
Honig Owns..
2,603,545 Shares Here is where most are.
Includes 782,912 shares of common stock held by GRQ Consultants, Inc. 401K Plan (“GRQ 401K Plan”) and 1,317,847 shares of common stock held by GRQ Consultants, Inc. Roth 401K FBO Barry Honig (“GRQ Roth 401K Plan”).
Here is your new O/S number
Based on 45,367,875 shares outstanding as of July 1, 2013.
DOZ
Every month NASDAQ publishes the estimates amount of shares that a stock has been shorted. Obviously if it goes up the concensus would be the stock is going to go down in PPS and if it goes down the inverse would be true. The only important number to me has always been days to cover. Many people will use this metric to identify a short squeeze also. Here is the site.
http://www.nasdaq.com/symbol/dss/short-interest