Chuck E. Cheese
Registered: Mar 2012
Posts: 115 |
10-01-12 11:54 PM
My entry has been average around $11.30ish (not full position) so no significant loss to write home about.
My issue is insiders cashed out 20 million shares or $ 1 billion during height or RE bubble. Now they're buying back in at $10 for only a few million shares (not including purchases made by Molybdenum Metales SA). It might seem that they're only trying to instill confident but nothing else.
Short interest now is about 25% whereas in the past it was as high as 40% percent. I used to short stocks before and my opinion is this is not a good short in comparison to NFLX, GMCR or FB etc...I suspect the shorts are just momentum players.
I've been doing my homework on the company and the share price is now even below book value. With NFLX, the price to book value ratio is over 4 and that company has more liabilities than assets.
Most of the argument against the stock has been the glut of RE flooding the market and crashing the price to the point of making the miners bleeding cash to death. But in reality, MCP's goal is to be a low cost RE producer on par (or lower) than Chinese prices and they have other products mix than just simply RE. Plus, they haven't fully operational yet, so it's too early to be the judge on them (But WS seem to like worthless tech stocks more than undervalued miners).
The fundamentals is not bad, but how often do stocks move on that? I will continue to average down via selling on weak rally and buying on the sell off to get a better buy in price.
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