Actually their financials show increase expenditures, dilution and borrowing. Seen in the income statement & cash flow.
Gross vs. profit margins suck., indicating poor management performance. The EPS & Net income are negative, fundamentally weak.
On the other hand the short interest is very positive, less then 1% and the one analysis has a stong buy on it for 3 month.
My eval of fundamentals show either the company is badly run or one which is investing large in actions for future growth. They are spending and borrowing more then the revenues growth warrants.
The TA & charts show continued dislike by the investing community, with little indications of this changing soon.
My personal feeling about averaging down on any stock, is "not a good trading strategy". Kind of like throughing good money into an old car. You may get another year out of it, but something else may break next week. But if the money is to restore the car, thats great.
I see why you are wondering what to do.
I am not a registered financial anything and any advice should be taken as non professional. Trade at your own risk.
Now for what I think you should concider. Do you know where the company business plans are headed. Do you feel management is going to increase future company value due to it's present financial actions? If yes stick around. If your planning to stick around because your in a big hole, thats something else. Restore or fix the car ?
Heres your options, as I see it. If you see long term future growth, average down, at the correct time.( the bottom is the correct time, not on the way down) The numbers will improve gains as growth climbs. If you feel stuck and want to re-coop losses on any share price strength, sell a portion of your holding and re-enter on new price increase. This is a get even plan. (and should happen as early as possible on the way down)
What I see, is management spending, revenues increasing. Investors & analysts thinking a bottom is coming. But the TA & charts don't project that happening in the near future.
Since I'm not sure future growth will result from managements actions long haul, but do expect something positive to occur, resulting from their actions. As the shorts & analysts do. I'd opt for a capital preservative plan, more then long investement averaging down plan.
----------------------------------------------------------- Looking at the chart, there is an descending triangle projecting an 80 cent bottom. But there is a strong support level @ $1.05. If $1.05 holds, it should bounce to 50% FIBS, because the bounce came from below 61%. So price target would be $1.55. If it continues past support to triangle target 80 cents, re-entry would be very cheap for any come back. Now, before the bottom, would be the place to initiate a capital preservation plan. And at chart pattern target, would be where to average down. Since a get even plan would reap the same very cheap re-entry benifits of average down buying, at the bottom. Why think average down.
Run the numbers in this example, you'll see the added benifit to inact a get even plan now. Because you will NOT be investing more capital, but reinvesting the original cash. (Not throughing good money after bad)
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