Hi Longtrade,
My current longs are just CDXC, LGND, NVDA, COST, ROST, TJX. (Besides, I hold ETFs IBB and ITB.) I'm reducing them (except CDXC) as their share prices increases. Other than that, I'm mainly doing short-term short-side trades, close to be day trading. If you have great short ideas please send them to me. I also have plenty of cash at this point.
On CDXC, I'm expecting a decent Q2. I have posted what I called expectation for a ho-hum quarter. However, beneath the surface, that kind of ho-hum result is actually a bit exciting.
Ex. special interest charges:
EPS = $0.009 to $0.014
With reasonable assumption about stock based comp and D&A expenses, here are the corresponding adjusted EBITDA
Adj. EBITDA = $1.27 million to $1.47 million.
QoQ growth = 45% to 68%
YoY growth = 213% to 264%
1H YoY growth = 635% to 705%
Management should emphasize the QoQ and YoY growth rate on EBITDA, if the result turns out to be within or near this range. Quite impressive actually, as you can see. If presented this way, the stock should be able to break out above its 200 and 50 EMA quickly.
I also have a blow-out scenario:
Ex. special interest charges:
EPS = $0.025
Adj. EBITDA = $1.90 million
QoQ growth = 117%
YoY growth = 369%
1H YoY growth = 852%
Management should again highlight adjusted EBITDA growth rate.
I believe institutional investors should have been crunching numbers at least just as we are doing. So, the blow-out case would send stock rallying 30-50% in days or weeks. I do not count on this blow-out scenario though. Stars have to be all aligned right for this to happen.
Turning to a less upbeat topic, the largest shareholder (Dr. Frost) of CDXC reduced a total of 1.378 million shares. His ownership is now about 9.8%, although his latest SC 13D/A filing indicated 10.47% as of June 21.
The market rightly shrugged the news off. Basically, Dr. Frost has been reducing his holding in other companies to fund share purchases in his own company, OPK, and to a much less extent, one (IDC) he is a Vice Executive Chairman. He is NOT a director with CDXC. He is just a large shareholder.
Just in case you need to have the knowledge. (The more you know the better, of course.)
You all have a nice weekend too.
