RE:LOOKING FOR AN ENTRY POINTThere are very few stocks in this sector that are investable. After my research, I think this is one of the best choices. The company has been less reckless, constant positive adjusted EBITDA for a while, cash burn and cash requirements are manageable and are covered by a significant amount of cash on hand. Dilution will be the result of further acquisitions which they should avoid. Unless they are picking up the distressed assets in liquidation.
They are losing market shares, but they are being smart by not dropping their margins. There are so many mickey mouse companies that are producing at massive losses they have paper-thin gross margins. They will be out of business this year anyway.
This reckless of the increasing market share at any cost and buying revenues by buying money-losing companies is not sustainable.
I think that this stock has taken a tremendous beating along with the sector. The sector is still overpriced and needs to correct further. This stock is offering valve at current and lower prices. Find it hard to touch a falling knife.
I will wait for it to bottom out o maybe start nibbling around the $5.00 area under certain conditions. Usually, I would wait for the stock to bottom out and form a base for stock that is in correction and falling knife. But this stock has a huge short position and can rebound very fast. That is a huge wild card.
The chances are this sector is no longer a growth sector in Canada. It is stagnating with ruthless competition and if the market correction continues for the next 6 months then the short sellers will get a chance to cover their position in a weak market.
If they make a mistake and don't cover it in the weak market then the rebound can be very fast and furious. Hat chasing stocks.
In the meantime, I will continue to monitor this stock and its short position.