I’m new to Ihub, but I have posted on other boards about this stock. It sure appears that this is the board to discuss Wellman. I reviewed the posts since December and agree with what most of the posters have commented. I think the following points should be highlighted:
1. The selloff the last three weeks of December was brutal – not only did a lot of institutions (and any indexes still holding WLM) have to sell the pink, but also some EOY tax loss selling was going on by retail and hedgies. It was a perfect storm for a forced selloff.
2. The fact that this went to OTC-pinksheets rather than OTC-bb is significant. Wellman had all SEC filings current so it could have easily have gone to OTC-bb; but rather they decided to choose the pinks. On pinksheets, Wellman is not required to keep SEC filings current (10Qs, 10Ks, annual meeting, etc) and we will not get info on insider ownership/trades, institutional ownership, and shorts (naked or otherwise). There’s a reason they chose pinksheets.
3. The Eastman lawsuit is an ace in the hole. I haven’t found a number yet, but any damages awarded increase shareholder equity to the tune of $1.00/share for every $33M recovered. And as some here have noted, Eastman (among others) might just buy them out to cut their losses.
4. The BIG unknown here is still BK! But watch the upcoming 10K (which they should file per debt covenants). If they have cut their losses so that EBITDA is positive for the last Q, they should IMO be able to work with creditors for this years debt refinance.
5. The current stock rise the last three days is not just a recovery from the forced selloff, but someone knows something big about the worth and/or prospects for this company. The buying pattern is typical of someone big (with insider knowledge) buying: first run up price, wait for selling into higher price, then run up again.
6. There are a few big stashes of stocks acquired during the forced selloff – I have personal info on this fact. The gamblers picking these cheap shares up weren’t waiting for 20-50% gain, they’re going for the 5-10 baggers.
JMHO
-the bum
