RE:What's going on with this stock?RDK241t,
It seems as if the market is confused with the refinance and offering. Mixed with utilities are out of favor and higher volatility.
Small Investor Confusion?
There are a lot of smaller investors and I bet they are:
· Having trouble modeling the changes
· Unsure why the company raised capital to issue a dividend (that’s what it appears at first glance)
· Wondering why the stock is off from its 52-week high
Large Investor Behavior?
Large investors might be shorting or selling after using the options they receiving. The reverse stock split might have increase attention, good and bad. Good for support, which may take longer to appear due to planning and positioning an entry. Bad as short-sellers may have the opportunity.
Other Factors?
Money Management Principles would state if a stock doubles or you get a 100% return you reduce your position (i.e. you take your money off the table and you hold the profit portion). I did not follow this principle on Alterra, I am buying and holding. But many investors may have sold or followed this principle after the stock doubled from its multi-year low.
A trading strategy is to sell after a 20% decline. So people who bought on the way up and are new may be nervous and sell at a loss.
Buy low, sell high is wisdom; but emotions tell you to buy high and sell low. Anyway, after the 20% decline triggers sales, the price lowers triggering more sells…this continues until a floor is formed. I don’t sense a floor, due to high volumes. I would like the high volumes help the selling get over with.
It might be the time of year for stock options to be cashed in and issuance of current year options. The cashing in of employee options might help lower the price; as to the issuance of current year. I would be ok with the lower stock price for employees as they sell as I would prefer for them to hold. I would prefer a higher stock price for options to be issued.
It could be due to the dividend was announced, but no date yet for record and payment.
It could be due to management sent a message, just wait we are growing organically! But has not made too many announcements. John Carson may pay the ultimate price with his job for his interview. If they miss expectations the stock price might have a real problem for longs\bulls.
Bottom Line?
The company did a reverse split stock to get attention, they got it! They raised capital, $68,000,000 that is impressive! Now they really need to execute! The future, is living up to or beating the expectations they set.
My plan
I wasn’t sure if we would see the $4.00 (US) range again, but here we are. If you are a long-term investor, perhaps it is time to nimble some more. I am re-positioning some funds to purchase a few nibbles or meal if it gets in the $3.50 range (US).
I continue to hold and invest in Alterra Power to 2018 to 2020.
I am very interested in:
· Seeing the 3Q2016 financials (to update some models with capital),
· Getting out of the quiet period and hearing the updates on new projects,
· Seeing if there is any way they can make the original projection they released in the Spring and
· Hearing the conference call
o I hope they hire a consultant to coach the management team through the presentation (hint, hint if the company reads the board; doesn’t apply to Mr. Beaty)
That is all I have for this evening, besides my continued patience,
Bold Forbes