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Uni-Pixel, Inc. Message Board

  • alpodell alpodell May 5, 2013 4:02 AM Flag

    Your Opinions Please - Does this Theory Make Sense?

    I've been studying the market action on UNXL and have a theory about which I'd value your opinions, long or short. I have little proof, just some winks and nods from hedgie friends and a bit of circumstantial evidence, but it all seems to fit the facts. As we all see, some of the volatility and upward mobility has come out of the stock recently. I compared the last ten trading days in March with the last ten in April: In March, the average difference between the high and low of the day was $2.60, but in the last ten days of April It was down to $2.20, a statistically significant drop of 15%, and trending lower. Further, the shorts continue to be able short, even though they have already shorted the entire float, and we wonder where they are getting these shares. My theory is that SOME LONG INSTITUTIONS are responsible, that they are restricting upward mobility by small share dumps and also lending stock to the shorts through intermediaries in order to reap about half the 30% carrying costs, and to keep the price of the stock low. Why do the long 'tutes and hedgies want to keep it low? Because they recognize that UNXL could be the stock of the decade, and they want to acquire more, at prices that are low (but not below 32, which would send a dangerous sell signal). (They did not do this in March because they wanted their Q1 gains to look good.) How long will they continue to do this? Until about June 10, when they will allow no more borrowing for shorting, will stop the secret sales, and will allow the price to start rocketing back up so they can show a super quarter, for which many of them are compensated, and let the stock resume its stratospheric rise. hat is what I think has been happening. What do you guys think? ..

    Sentiment: Strong Buy

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    • I found this a helpful exercise, hope you all did,. Mabye we should do this every Sunday, have a calm discussion of what has happened in the week past and what is likely in the week ahead?

      Sentiment: Strong Buy

    • I like the theory, Al, as it is both savy and self-serving for the 'tutes, as you call them. And it takes some bigger players to keep this from rising as all evidence is that management continues to successfully execute the plan.

      I also believe that some investors were looking for more details of the deals, and/or promises of future deals in the works in the 4/30 conf call. When they didn't get it, they saw little opportunity for 'short term catalysts' for immediate gratification. As others put it, some of the 'hot money' investors are taking profits here.

      I personally have told half a dozen investing friends about UNXL and invariably, they say "You are up 150% in a couple months? You should sell!" Trader mentality.

      Sentiment: Buy

      • 1 Reply to jbird_1961
      • Good analysis, jbird. I was not disappointed by what Killion said on 4/30, nor were the institutional holders, all of whom congratulated him, but you are correct to point out what I had not thought about, which is that those with a short horizon and looking for instant gratification, probably were not pleased and have been selling their shares. So sad. In their haste to look for a hotter stock they may be passing up the opportunity of an investing lifetime. $20K in UNXL today could be a million dollars by end 2015. Thank you for sadding some good stuff to the discussion here. al

    • Al: I going to call you tonight. Gotta put a bug in your ear!!

      Sentiment: Strong Buy

    • Al, Your theory does make sense to me, not only because of the numbers but because there are such relatively few shares to be had.

      The bigger question, in my mind, is why the demand for short shares is so high. Guys like Zhou and Wiley have virtually disappeared from SA, ALL the arguments against this company have been proven false each and every time. The only sad few we seem to have left are the desperate ones on this board who are seemingly in the last throes of their shortness.

      And yet the number of shorts is holding steady or climbing. Where does that demand come from? Are institutions whipping up demand? Are these just technical analysts looking at past earnings in their black boxes? Is it a herd thing?

      Ultimately, staccani is right I think. The best thing we can do is to buy on the dips in an attempt to keep upward pressure. After a stock split or major news or more partners or massive shipments the demand for shorts should evaporate.

      Suze's mantra has guided me well--patience, patience, patience.

      Sentiment: Strong Buy

      • 1 Reply to scudeshelman
      • Let me take as crack at an explanation, scud. The shorts are stuck in the deep hole they have dug for themselves. But they have gained a valuable skill -- an intimate understanding of the daily price action in UNXL. So each day they wait for a rise of a point and a half or two, then go short, drive ole Pixie down -- any bets on how many minutes before duckfart steals that line? -- then buy back. And continue the next day. Etc If they can make two points a day, that is ten points a week, a good 25-30%, enough to pay their rent, buy a few corn dogs, send their wives to the plastic surgeon, and pay off some of their margin calls, while they hope for a meteorite to hit Woodlands.This will continue, IMHO, until the inevitable day when they can no longer drive ole Pixie down and we got a rocket to ride. I am thinking between mid-June and end June, or whenever the price stays above 43 for three days, whichever comes first.. .,

        Sentiment: Strong Buy

    • Al. Friday was interesting. There was a big buyer under $35. Looked like mm kept bringing it back under $35 at least 4 times. Once it took out 5,200 @ $35.03 she went higher. She looks ready to move higher any day. I think you are looking too far into it

    • Difficult to say, Al, but that is quite a realistic scenario. Keeping price in check with HFT in order to accumulate is one of the tactics that MM use. They have also used 'bear raids' in at least a couple of times to take out all stop losses. Lending out shares to shorters is another distictive possibility. But I suspect that no MM's will answer your question, first because it is against their interests, secondly because most likely do not read message boards :-). One thing is sure though: no MM can influence the fundamentals of the company. As long as UNXL will keep executing and deliver along the set targets, the price will keep going up, and ultimately the price will realingn to the fair value of the stock. So in my opinion the best thing to do in this case, since MM are accumulating (and we can see that from the increasing institutional holders %), is to accumulate along with them

      • 1 Reply to staccani
      • I fully, totally. and completely agree with your conclusion, staccani. But I am kicking modern Portfolio Theory to shreds. This little puppy is already more than 25% of my portfolio. And I keeping adding more, and buying more long calls, almost every day at what I believe are these ridiculously low prices. I mean, at these prices the P/E on estimated 2013 earnings is only 23. Not a lotta risk there.

        Sentiment: Strong Buy

 
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