Selling OSTK is free money. It has absolutely ZERO prospect of ever producing a sustainable profit. And the founder/Chairman spends all his time chasing short sellers in a sad but entertaining effort to save his baby. Timing and leverage w/ shorts is tough to manage, so make this a small but persistent percentage of your portfolio.
Talk about the walking dead. At the end of September OSTK had $145-mil in assets, but $149-mil in debts. Quick ratio of 1.4 is horrid. The company is also bleeding about $5-mil in cash per quarter, STEADY STATE. This last quarter must have been disastrous. Now with credit markets shut, Byrne is going to have to dump a sh*tload of stock onto the market in order to survive, or very shortly creditors are simply going to cut them off. And what broker is going to try a float some OSTK now?? Looks like curtains for sure. Sprinkle a little 'short OSTK' in your portfolios folks. It may be illegal to short the financials, but its always a public service to short a pig.
Remember I said I don't pay much attention to fundamentals ? This is why. 1. OSTK has a suit vs Wall St. They are in discovery. I'd like you to think of 12 people who, when presented with a company vs. Wall St., will side with Wall St. 2. They were suing Copper River and Gradient. Gradient settled, but terms were not disclosed. Do you want to trade against that? You just saw the Emails with Cahodes (Gradient) and a reporter. Maybe they've got some dough we dont' know about, although I would have thought they'd have to put it in an 8K. Again. I don't know. Gradient was the smaller entity. maybe they just got the goods on Copper River. OSTK just put a press release out on CR; they are dissolving. 3. Jack Bryne is worth billions. He has publically said, given the disaster that has befallen us, he wishes he had supported his son more. I doubt he lets the company fail. But again, I do not know Jack, just of him. 4. When I first talked to him, I asked Patrick why he was targeted. There usually is a reason like, a PIPE deal, or a criminal record - something the shorts can build a web around. Patrick received a call right after the Dutch auction where a Wall streeter, I don't know who, said, "we'll destroy you." You 've seen enought up to now to realize the float may be naked shortedseveral times over. Do you kinda think this is a crowded trade? 5. New SEC commish, politicians. You may see a huge move vs. Naked shorting and fails, and if OSTK never sells another thing, the stock could be a monster. That's what you trade - stocks!!!!! 6. I obviously hit a nerve with BlueHorseshit. I can't believe he's stupid enough to short OSTK, but I can hope so. Anyone who trades with that emotion gets killed. Again, I can only hope. OK?? Oh, and in all my years, I've never met a more kind, caring, intellectual human being than Patrick Byrne. He may be the worst CEO in the world, but as long as Blankfein, Fuld, O'Neal, Mack walk the planet, I doubt it. Means nothing to me anyway. And I do believe his strength in this comes from fighting for others; I really don't believe, especially after three cancers, he has a selfish bone in his body. But you all do and think what you wish.
Yeah, buy OSTK because Jack Byrne is a sweet guy. He probably wears warm, fuzzy sweaters too. Disregard that the company burns $5-mil a quarter and neither his father or WB, who happens to be pouring his personal billions into the market as we speak, would touch OSTK with a soiled barge pole. Disregard that Byrne wouldn't think twice before hoisting his worthless shares on any pension or index funds oblivious enough to be taken in by his charade. OSTK is worth less than zero. Current shareholders have NEGATIVE equity in the company after already investing ... how much? Jack Byrne uses OSTK to destroy capital that could be better utilized by so many others. He is a Sith Lord - taking good capital that could fund health or clean energy research, and instead burning it to feed his own ego. Byrne should explain to Michael J. Fox why OSTK needed the capital more than the Parkinson's effort. Byrne should explain to the Missionaries of Charity in Calcutta why it was better that he destroy that capital than send it their way. Byrne should take a congratulatory trip through Venezuela, Iran and Russia to receive accolades for diverting capital from alternative energy efforts . Sell OSTK. Its pure profit. And its the right thing to do.
I talked chit in the past about this stock, but with all the manipulation going around, I'm gonna grab some and hold. Couldn't be a worse time to have a retail stock like this, but here's to the honest guy being f'ed with by a bunch of crooks in suits.
I have nothing against flying tiger or ostk - but I did work for some stock promoting ceos who always blamed shorts for the fact they could not make money.... so in the interest of fairness... its ironic that fly just defended the stock price by saying it is over shorted. I thought that shorting caused stocks to go down because shorters were evil doers. do shorts cause companies to go out of business or not? I think you just answered the question.
By all means, Gentlemen. If you think it's overpriced, short it to the max. Buy puts. Have at it. No one here has a problem with shorting, and neither does Patrick. Short, short, short. But get a firm locate and borrow.
Fundamentals mean nothing in this market. So let's look at OSTK from a technical standpoint: Looking at a 3-month daily chart, they've tried to test their last resistance level of 13.44 for two days in a row and failed. They've just pivoted down from an overbought condition. They've pulled a good distance above their 20-period moving average, and have been riding beneath the 200-day moving average. This is one of those "moon in the seventh house, Jupiter aligned with Mars" trades, or what I like to simply call "high probability". You've got the stock closing yesterday @ 12.49, with minor resistance @ 13.44 and major resistance in the $16-$17 range (at the 200-SMA). The overall trend has been down, with progressively lower highs and lower lows. However, this double test of minor resistance is key to whether they've staged a true reversal or not. All these factors point to excellent intraday or swing shorting opportunity. So IMHO you could trade a larger intraday position with a tight stop ~ $13.50, or a smaller swing position with a stop in the $16-$17 area.