Price ActionPrice Action Coming into this last week of December, stock was already weak , likely due to common knowledge of supply delay due to large demand and some customer issues.
CBC news came out with the story on Tuesday afternoon at 3 PM. (Cdn Markets closed)
Wednesday was the first day when stock reacted to the news, opening down at $33.83.
There were buyers @32.50 and $32.65 and stock closed at $32.57, down 5%, on the day.
($32.50 was the support level)
Thursday morning, stock opened lower at $32.17 and resumed the down trend touching a low of $30.21 (only 100 shares traded @30.21). However, soonafter, downtrend clearly reversed as there were serious buyers ( Jerome Hass of Lightwater capital included) starting at $30.95 which continued till end, closing the day at $32.
Friday, stock was steady at the opening and there was strong suport at $32 level, all day. It could not break through $32.50, though. Closing was not bad @32.19.
I am not a TA expert, but it looks like the kneejerk reaction to CBC news, seems to have been contained now and cool heads will prevail in comming days.
Thanks for posting Motley Fool article, Luberon and most of us on this board seem to be in consensus with the writer's views in conclusion:
"
As usual, when problems arise, investors will sell first and ask questions later. The 12% pullback seems to be overdone as the company’s share price began to recover midday on the second-day pullback.
Today’s price action will tell whether the shares will continue its recovery path or not. In any case, at $32, Spin Master trades at a forward multiple of 17.6, which is an attractive valuation to pay for a high-growth company.
I believe the Hatchimals issue is a temporary one, and a year from now, investors will look back and see that the recent dip was actually a buying opportunity."
GLTA !!