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ZAGG Inc Message Board

  • mngtscrwdup mngtscrwdup Apr 26, 2013 1:25 PM Flag

    shorts cant drive it down

    short side attempts to drive the stock down are growing desperate and weak. today it bounced right back. apple heading higher. we are on the countdown to zagg earnings release which will be a problem for shorts. can they stiffle another rally after the earnings report? let's see how the next week sets up. if shorts cannot defend the descending resistance line, they are in trouble

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    • You realize the shorts ARE the support right? Basically they cover in the lower $6s which is what keeps bouncing the stock up. They do try scare tactics like this AM but they are doing ALL of these moves. Post earnings enables us to get some Buyback support again that Monday, so I do agree the stock just has to hold until earnings and then let the natural surge plus the Mon BB support take us back to mid-$7s. The shorts will push back down as we approach $8s, we got game this quarter but not enough to push above $8 imo.

      Sentiment: Strong Buy

      • 2 Replies to smilingwolfcapitalmgmt
      • i agree that the shorts basically run trading programs, buying at certain levels and selling at other times, with a bias downward and always selling at key resistance points. but i think the shorts have some tangible limits. at some point the value investors start buying the stock based on fundamentals. given that there just arent many shares available to short, the shorts have a choice to naked short the stock and potentially get nailed for it, or get overwhelmed if there is big buying interest. if apple shows that it has truly bottomed, it will be up to zagg's earnings, and even more important their guidance for next quarter. although the shorts have driven the stock down this far, if there were more buying by big funds they would overwhelm the shorts sellers quickly. last quarter there was not much change in fund positions in the stock. zagg needs to set the bottom on the stock with a good forecast and an increased buy-back program. i want zagg to get serious and add $20 million to the buy-back, and execute it fast.

      • You are probably right about the shorts. More troublesome from a retail investor standpoint is that they are also likely among the biggest longs. I think Zagg has weak investor relations and would do well to look carefully at the effectiveness of their current third party IR. Investor relations should be playing a role both in courting new investment as well as PR. With all the distortion going on from the shorts, Zagg IR appears anything. Of course the propaganda machines always fire up during the quiet period. And, much of what is being said is part of the whole short rinse and repeat cycle that should be transparent to investors. But, Zagg both pushes information to customers and personalizes online really well. Couldn't they also do some damage control with the distortion? Does their lack of response have to do with the slowly progressing lawsuits? The real problem here is short term expectations vs long term results. We want fair market value now. Zagg says you'll get that....later. For a shareholders short term results Zagg's best options, which have been repeated many times on this board, are to increase the buyback, issue a special dividend and/or explore M&A possibilities. Increasing a buyback or issuing a special dividend are unlikely because normally a small cap growth stock like Zagg should be using their cash to grow. However, I think we deserve to see the plan to create pps value for us on this next conference call.

        Sentiment: Strong Buy

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