Atkinsrealis Group Inc T.ATRL

Trump Team Weighs $1 Trillion for Infrastructure to Spur SNC

[Gabriel]

Trump Team Weighs $1 Trillion for Infrastructure to Spur SNC :)

[tomperns]

Huge news although kind of expected. I also expected SNC share price to jump by $3 in this news. I can't believe how much the market is discounting SNC. 

[Gabriel]

You have about 5M shares sold short.  Out of an average of 650,000 shares traded daily, we can fairly estimate 85% are sold by algorithm trading with 15% or 100,000 shares acquired by funds or people like you and I.  Based on 500,000 not 100,000 shares a day, you need 10 trading days for shorts to cover. This process referred to as short squeeze is what drives the swings up

[tomperns]

Excellent points. In theory we should be at $35 right now. Let's hope that gap gets filled shortly.

[Gabriel]

Two reasons for the share price weakness: The shorts are not covering yet because they are counting on poor Q2 results. They will be surprised because Asia has performed substantially better in Q2. The funds are not adding to existing positions or initiating new positions because they are waiting for the end of negative surprises considering snc has disappointed many times before. These

[Payman2dib]

There is a litigation case in the courts regarding some fondations cracking in Mauricie.  Last I knew SNC and al had lost in the lower courts and that SNC might go to the highest court.  This is a 200000000$ Litigation.  Could this be another hurdle down the road affecting stock price again?

[Gabriel]

1. It's covered by their professional liability insurance except for the deductible. 2. Their exposure is 7m and is specifically reflected in the financial statements.  3. snc and its insurers are contesting the decision. Cheers, Gabriel  

[Payman2dib]

Very clear.  Thank you