In my opinion only, I have been watching this stock all day. It hit 5 dollars three times and it pulled back. A lot of people bought this in the three dollar range. It is a target once the stock hits 5 dollars or more a lot of investors might start to take profit. That is why I sold some shares before the 5 dollar target. In my opinion only, they could pull this back to about 4.10 to 4.30 range. That is when I plan on buying more for my portfolio. The profit that I made off of this so far I invested it in ROX Castle Brands. I believe this could be another Rite Aid turnaround story. Here are some facts about ROX. Net sales increase last quarter by 7.2% to 10.4 million compared to 9.7 million. Goslings's rum sales increased 19.7%, Goslings's stormy ginger Beer case sales increased 50.1%, Jefferson's bourbon and rye led to a 26.1% increase, general and administrative expenses were reduced by 4.7%. You could find this out on their fiscal 2014 first quarter results.
The other view which is widely held ( though not 100% accurate) is that above $5.00 those institutions that are prohibited from buying will be free to purchase shares. One must ask oneself, does one want to sell before the big institutional blocks are ( assuming one buys in to the " 5.00 dollar" view) being purchased?
At the current price this stock is basically a call option without an expiry. If one believes in the company, there isn't any reason to sell .
In my opinion only, this could pull back or go a lot higher. The five dollar institutional buying is considered a myth. Maybe one time institutions had a rule that they could not buy a stock that is under $5. These rules are not set in stone. These rules change and the institutions change them to their needs. A lot of institutions buy stocks that are barely over $3.00. The only advantage is that the higher priced stock could be margined. Like I said, I sold some shares. i still have a lot of shares left in Rite Aid. It is okay to lock in some profit or reinvest it into another opportunity.