This is why i still do not want to buy. At the very least management of EBIX have your lawyers look into this ASAP. It is your fiduciary responsibility to go after Gotham when they slam you like this.
Whereas, HLF is a pyramid, I believe EBIX is on the level. Thus I think management stinks and this is why I cannot buy into this overbought rally even as a day trade.
Sorry longs, I want to join you but I am concerned that at any moment something else will occur and with incompetent management longs could get screwed..
As for you shorts, you better be right casue if you are wrong you will be covering at a very very high price!
Management is excellent, just before earnings they can't say much. Hope the Gotham part 2 comes out before earnings so i can buy more.
Gotham is a disposable straw dog created just for this short attack.
Really juicy buying opportunity coming right up, if not here already!
Anyone interested in companies fighting back against short sellers should read about Fairfax Financial and its protracted legal battle against an alleged conspiracy of hedge funds and analysts, including SAC and Loeb. It's quite a colorful story involving spies and hackers that has the makings of a Hollywood movie one day.
Ultimately Fairfax thrived as a corporation and so proved the shorts wrong from that point of view, but the last I checked Fairfax lost all of the litigations. The litigations may have served to restore some reputational value to management, but all things considered it was probably an unnecessary expense and a huge distraction for management over many years.
I have been an attorney for over 20 years where I am a commercial litigator and have been a member of firms who practice class action and securities litigation (where I have also dabbled). To do this right, it is going to take some time to put an appropriate lawsuit together. Such a lawsuit would be both a factually and legally complex filing in that the complaint will have to deal with a multitude of factual misrepresentations made in the article(s) and involve a multitude of causes of action which may include in addition to libel, causes of action for false light, fraud, violation of various provisions of the securities act, and others. There could also be two plaintiffs or two different cases filed: one which is brought by the company and one by Raina in his individual capacity. Also, if such a lawsuit is brought there is a high probability that the Copperfield article, Bloomberg, and/or Farrell (author of Bloomberg articles) could be named as defendants. The best and largest law firms could probably not put this all together properly before Monday of next week if they started working on it the day after the Gotham article was published (and probably longer to do it right). The lawyers for Ebix (should it bring the claim and not through a class of shareholders) realize as I have posted here before that the lawsuit is not really about obtaining a large financial recovery because the target defendants (other than perhaps Bloomberg to some small degree) have no means to satisfy the kind of losses we are talking about here. Rather , the lawsuit is being brought to serve as a means to respond to this short attack and send the market a message. As such, the lawyers know that every word written will be carefully reviewed and scrutinized and even minor mistakes could have an extreme negative affect to the share price. Careful drafting of this kind is very time intensive so relax because I will be shocked if legal action here is not initiated by the company, and if not, then likely in the form of a class action on behalf of shareholders.
A business' primary goal should be to make money. There is no point in spending gobs of cash on lawyers just to prove a moot point. At most, let IR put out a more detailed rebuttal. Raina should spend his time on making sure that EBIX continues to execute and make money. At the next earnings report, as long as cash continues to come in, the stock price will take care of itself.
I like your logic, however I highly doubt a law suit will be in the works for reasons you pointed out. The people that caused the harm likely won't be able to pay any significant recoveries, blomberg will simply say they reported on the article but did not endorse it. And by end of week the stock price will be back where it was. What you will have is individuals that may have good legitimate claims should they choose to pursue it. The company will most likely take 2 actions. First, on Monday expect to see a detailed response to the Gotham report. 2nd an official complaint to the SEC about the blatant manipulation of stock price. I don't see the benefit to pursuing litigation on principal, and neither will management.
I agree management should have immediately responded to the short attack, but think you are being overly conservative waiting for a time to buy shares. When EBIX was at $12.25-12.50 this morning was the time to jump in . . . as I suggested.
Sentiment: Strong Buy
No kidding. I am more and more convinced that most of the shorties have never managed a real company. I guess they don't have to if their business model is simply to manipulate stocks. I'll stick to running a real company, and investing in real companies with real business models, real offices all over the world, real customers, and real cash flow.
Furbush87 and others; I believe when the PPS is crushed immediatle action is required. 48 hours could be and has been deadly. As for entering this stock at 12- $12.50 as some have suggested is reckless. As there could be some merit to the allegations and $12ish could easily be $5 ish. Alas, I have missed this one FOR NOW. However, that does not mean there will not be a time in the future I will be a buyer/believer of EBIX.
Overall this has been a good week and a good last six months. I see no need to get on board when I am not getting help from management.
This is just MHO.