What is driving the recent share price rise of SCCO over the last 5 to 6 trading days?
At COB 2-3 SCCO was $27.58 and at COB 2-10 SCCO was $30.48 that is a rise of 10.5%. At 10:10AM SCCO traded at $31.00 which represents an accum rise of share price of 12.4%.
Earnings release was after COB on 2-6. From COB 2-3 thru COB 2-6 share price rose 3.12%. After earnings release thru 2-10 SCCO share price rose another 7.17%.
During this period daily volume exceed average daily volume on 3 days and there was no significant rise in copper price.
Am I to presume somebody knew something PRIOR to earnings release and after earnings others continued drive the swift rise in SCCO share price?
Could it be Tia Maria? Could it be an anticipated rise in copper prices? Could it be the beat to a weak EPS forecast or a nice beat to revenue forecast? What about SCCO repurchasing? Based on KNOWN facts is a 12.4% share price rise thru 10:10 AM 2-11 justified?
Seems to me almost all known IMPORTANT facts were available prior to the recent rise in share price …... so is this rise for real and will it continue?
Has SCCO regained it's ju ju and historic volatility or is this a head-fake and will SCCO retrace?
Can the 17.7% rise in SCCO share price since 2/3/14 be justified by FACTS? I think not ..... and IF I AM CORRECT, what should I do since SCCO represents a significant portion on my sheltered and non-sheltered portfolios and was the largest dollar drag on those portfolios over the last year?
Now, don't get me wrong, I continue to think that SCCO is a good long-term investment but here's what I'm currently thinking. IF SCCO continues to rise over the near-term I will be very tempted to sell a couple of thousand shares out of my sheltered accounts when I think SCCO has risen to unsustainable near-term levels and then re-buy after share price drops 5 to 7% from those levels.. The big question is what are unsustainable near-term levels? Me thinks anything over 38 and certainly anything over 40. I think 38 to 40 is a BIG STRETCH ..... but remotely possible. Certainly continual re-evaluation of this strategy is required based on any emerging facts and/or market action.
On another topic, January was a big disappointment for me but YTD my somewhat conservative portfolio has turned around (primarily due to SCCO). YTD thru 2/14/14, I'm up 2.04% which, if I've calculated correctly, beats the DOW, S&P and even the NASDAQ and puts me in-line to meet my 2014 objective of growing my portfolios by 12%.
Firstly, rise in SCCO share price is justified by fact (in small or large caps, doesn’t matter): big decrease in LME copper storage number. This number is an objective indicator for copper supply/demand. This decrease implies that copper consumption doesn’t falter as it was speculated in some analyst comments. Sooner or later, hopefully soon enough, this situation will move copper price higher.
Secondly, SCCO was able to report solid earnings beating analyst estimates. It doesn’t happen too often. Guidance was positive, especially, long-term projections.
Thirdly, you can do whatever you like with your SCCO position. It is always good to lock on profits, though it is even more important to have own investment/trading strategy that doesn’t depend on advices solicited from Yahoo message boards. It can be also noted here that near-term market moves are hardly predictable.
Also, message board reports about personal investment achievements have very little relation to actual stock investment. Shortly speaking, discussion is productive when it goes about stocks and it becomes unproductive when it comes to personally-related notes (of any kind). Yahoo message boards are littered with winning reports. It says a lot about human nature and very little about stocks.