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ShopKo Stores, Inc. (SKO) Message Board

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  • snugly60031 snugly60031 Jul 17, 2001 8:44 PM Flag

    Why is this POS up today???

    All of the bad earnings news is known. The recent move-up to is inexplicable average investor following the stock for last couple of years. There is obviously a different dynamic moving it now. My guess is SKO moves up to $9.25-$9.50 tomorrow, then look for a parabolic rise from there. $11 is a no brainer, but probably goes to at least mid-teens before a pause. Short covering won't explain the action we have seen, because shorts simply re-establish their position at a higher level when they cover. You don't get stocks closing at their daily high, as SKO has done several days in a row, with that kind of action. This looks like accumulation.

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    • All the bad news is NOT known since results continue to deteriorate and no one knows where the bottom is. Furthermore, SKO has about $300 million of junk bonds starting to mature next year in an environment where Wall Street will not fund JUNK retailers. The junk industry is littered with bankrupt retailers.

      SKO may have to do sale/leasebacks on its real estate portfolio. This may allevaite debt concerns over the short run but it will impact profit margins because of increased rent expense.

      Short covering is obvious answer here if you look at the Short Interest ratio.

      As for "this is a no brainer". LOL ..... that is a fools statement who feels the a stock should be going up despite deteriorating fundamentals with NO end in sight.