Yellow caution sign. Fact, RDN stock experienced a significant run-up from $ 6.22 to $ $8.50 since February 11. The firm has negative yearly revenue growth Q over Q yearly of .38, negative Gross margins of -.24, negative PE and PEG. Analysts opinions vary from 1 buy to 6 hold or underperform. The stock may be ahead of its fundamentals exceeding 20, 50, and 200 day SMA.
Many expect the market to pullback by 5-10% sometime between now and the replay of the Washington DC thriller horror movie " Sequestration " at the beginning of March. A low beta stock could expect to experience a ratable retrenchment, higher beta issues have exaggerated movements up in good times and down during pullbacks. Put in context, during the last confrontation over the sequester in November, RDN dropped from $ 5.55 November 2 to $ 3.82 November 15, not sustainable surpassing $ 5.55 until December 26.
Conclusion, RDN is a quality company trying to turn around a troubled business, however at current price levels the 30-45 day risk/return is disproportionately negative. A price pullback, normal market correction or sequester inspired retrenchment suggests a safer price range closer to $ 6.22 offers a better return with lower risk.
eyesandears51...you're new to the RDN board, but not new throwing water on a fire...and RDN's on fire. RDN trades outside of the Dow and S&P in the sense that it is housing market dependent. So goes the Dow, is NOT necessarily how goes RDN. It's a good bet though, when housing's on fire, like it is now, so is RDN.
You are a professional naysayer. A casual glance at your historical posts will indicate the same. Your employer pays you to come on boards like this and provide a PLAUSIBLE BEAR argument. Then...and this is the really funny part...you log off and come back with the name of crkenmore, and provide testimony as to the reasonableness of eyesandears51's prior bear position....a real bunch of tag team buddies you are.
The reason your arguments don't hold water, is because nothing will beat back the American consumer standing in for a Black Friday sale at Walmart or that same gainfully employed consumer who's qualified to buy a home, from buying it...especially since the Fed is on the record time and time again, saying how they'll keep interest rates down...especially during this period of growth. I believe the qualified home buyer will operate beyond the scope of the so called Sequester.
So take all your reasonableness and stick it where the sun don't shine.
I am positive on Radians mid and long term prospects, but am concerned about the 30-45 day time horizon where I believe caution is warranted for any stock with a very large secondary offering and an already highly appreciated price. Kors, an company where I have significant holdings, is a reasonable comparison. A high growth company with a stock that reached all time highs, could not sustain the pressure of a large offering in a choppy market. RDN may experience a different result. I would welcome understanding your fact based reasons for believing otherwise. My motives are to test my thesis against well thought out views of others before committing to participate in a secondary that holds promise but at considerable risk at a record price.
My stepfather ALWAYS warns of the impending correction. No matter what, or when, there is a correction just around the corner in his eyes. He is ALWAYS correct. Sometimes it takes years, but he is always correct.
I could sell my 20,000 shares (paid $4 per), but I am going to ride this one out. I'm betting on Luck, but thanks for the free advice.
Thanks for your honesty. Luck is an expression of hope that we all experience. I now invest for a living and rely on probabilities. While it is true that if you predict either a market rip or retrenchment every day, you will both right and wrong 100% of the time, I choose statistical and precedential analysis as a more accurate, but imperfect, way to #$%$ risk/return.
Reasonable analysis. Also consider 28.8% short interest, well above the 10% threshold for battleground stocks. The holders have a high motivation to see the stock drive sharply lower. $ 6.22 target is much safer and more reasonable