Glad everyone made out on STS. Definitely seems to be more opportunities on the short side into earnings. So many stocks have run up with the market near record highs. You have momentum traders stupidly chasing stocks right into what is likely to be a weak earnings report. Then those momo buyers turn into panic sellers the day after the numbers when...surprise, surprise...they weren't that great.
CYBE another one where I don't get why the momo crowd is chasing this one into earnings next Tuesday. Shorted some more this morning. Even a terrific report is priced in. Stock just hit a 52-week high. On a down market day too. Don't get it. Q3 numbers will be well down from Q1 & Q2 when the stock was around $15. Altho they have an easy comp, so Q3 numbers will show a nice improvement vs. last year. Think it's interesting that unlike in Q2 when they included something about how Q2 would show strong growth in revenues in earnings while announcing the earnings call...they didn't do that for Q3. I think that's a good sign if you're short, but nobody else seemed to pick up on this.
Even though Q3 results should look decent, CYBE didn't announced a single order in Q3. And the Q3 revenue guidance of $13M-$15M includes the remaining $2.9M MX backlog, plus an $800K order announced in early May. So I don't think the Q4 guidance is going to any better than the Q3 guidance. If it's worse, stock plunges back to the teens. CYBE then faces brutal comps starting in Q1, and will start paying taxes next year. This was a $6 stock a year ago. Crazy to hold this one into earnings...but momo traders keep on buying.
