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Synta Pharmaceuticals Corp. (SNTA) Message Board

  • jfk123_1 jfk123_1 Aug 1, 2013 7:00 PM Flag

    BE CAREFUL - A DANGEROUS STOCK TO SHORT

    No intention guys to either pump or slam. Just my two cents.

    Only a fool would short this here. I have been trading it, was long and then tried to short above 7. Could not get a short in because the shares were too hard to borrow. Not just too hard to borrow with high interest, but there were no shares at all to borrow, period.

    You are dealing with short interest over 45% of the float, and insider ownership (with no real selling history amongst insiders) of well over 40%. And this price level is well within the range where insiders have picked up lots of shares, especially the billionaire, who is an active frequent buyer.

    This leaves around 10% of the float as potentially a source of coverable shares. But with the volume we have had in the last week, that figure might be even lower, say around 5%.

    That is a ridiculously tight margin to cover. Forget about the total short position as a percentage of float or the days to cover from volume stats - which are bad for shorts in any case. This margin to cove is one of the worst I have ever seen.

    With the news that we are moving to phase 3 soon, and the news about the one individual who had terminal inoperable metastised cancer that was abated, reclassified and resected, there is ample fundamental support to keep genuine buyers coming in. This demand, and the margin to cover situation, along with analyst targets well above double the current share price, make this stock a serious risk for a major short squeeze.

    Don't risk going short - you could get lucky and get out at around 5, or be trapped and cover completely only at 15.

    Also what is a danger sign is how the bid size was so large and slowly absorbing the selling pressure. No idea who has picked up these shares, but could well be someone who is not going to sell or lend out.

    Speaking of lending out, clearly the short interest can only exist with large institutional positions lent out (over 40% of float is institutional and I make the assumption of no overlap

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    • PS - we are down on pretty low volume, 2/3 way through day and volume less than half average. Not a real move, just accumulation and some odd retail shorts jumping in.

      You had to expect the shorts to try to protect a clear breach of 7.15. Up from there no resistance until 13 on the charts. That would trigger a real squeeze.

      Be patient. The shorts are screwed. When we get a high volume move through 7.15, we will be to 9+ in a blink of the eye, and then the fun starts with the squeeze.

      Shorts are in serious trouble. No matter what nonsense they pump out in SA, etc. They can not change the fact that a terminal case was made operable and the person is now completely cancer free, and they can not change the fact that there are no where near enough shares to cover here. And B.K and gang keep buying even more shares. Screwed, that is what shorts are.

    • Ah, I see the shorts are nervous, you all give them too much airtime. What I wrote in my posts is only more true now. B. K. has bought more shares, and the margin to cover is completely gone. Everyone is talking about this as the next big short squeeze. Only silly retailers get nervous.

    • jfk123: I enjoyed your post. I too am long. I have a question for you. The stock price went down all the way to $5 and was there a while. The short interest was large then too. It wasn't the Longs decision to rally against the shorts that drove us from $5 to $7.80, it was really great news about the breast cancer data. As soon as that fizzled, the shorts were back in control again. Without another really great new release, will the longs be able to state a rally on their own?

    • A look at how the intense relationship between Carl Jung and Sigmund Freud gives birth to psychoanalysis.

 
SNTA
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