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SUPERVALU Inc. Message Board

  • med_investor med_investor Jan 30, 2013 10:40 AM Flag

    Why shorts have small window to cover if they have not by now

    I see brokerages started to send e-mail to investors who hold SVU for tender.
    Investors who do not want trading headache will tender. So, day after day, the float will shrink and brokerages have less shares available for shorting. When shares are removed or put for sale then brokerages either have to buy shares or ask their short customers to cover.
    On the other hand, as the price goes lower like today then return on tender will go higher and more investors will join buyers.

    Now, above was for tender playes. How about investors who do not want tender and see higher prices than $4 because of many reasons like having higher than $4 of cost bases or they see SVU a company that is stable now and can grow significantly. Most institutions will not tender.
    Retail investors can still benefit by buying SVU at low $3.80 and get 4% to 5%. If price goes below $3.80 then it will be a steal.

    Sentiment: Strong Buy

4.57-0.120(-2.56%)May 23 4:02 PMEDT