When everyone is bullish on a board about a buyout
Good luck! It may or may not happen tomorrow, but I would make sure I am covered by the weekend. Related to rumors, sometimes they are true, sometimes they are out of touch with reality. This one (that there will be BO) is very real on many accounts and saying there are "easy money" laying around is at minimum dishonest. I've been through several BO with different stocks and this one is one of the most dated and obvious ones to me.
Guys. Did you even read the star tribune article? Says he may only offer 18-19 next week which they expect the board to immediately reject. We'd likely hear about this low offer after the board rejects and then it tanks.
heheheheh. Yes, I have a lot to learn from you. lol. I've only been trading stocks, options, and futures for 35 years. BWTFDIK.
It's entirely possible that ULTIMATELY there will be no deal. You are correct that we might only hear of the offer AFTER it is rejected by the BOD. And you actually think the stock will go DOWN on that? hehehehehe. Are you insane? If an offer of $18 or $19 is rejected by the BOD, this stock goes much HIGHER - not lower. Why? Because another offer will be taken directly to shareholders in January (a very short wait), at a higher price, and that'll be all she wrote. Schulze knows that the shareholders will accept a lower price than the BOD. Get it? He has no incentive to bring his best offer to this disgraceful BOD. So he will lowball them, get rejected, and then take it to the shareholders with an increased bid, and gets the company for a song. It's so obvious. How can you not see it?
But no matter what happens...this is a LOUSY short. Give your head a shake. What the heck are you thinking? Why in the world would you pick this stock, of all stocks, to short? Makes no sense.
You guys are all bullish. Believe me, it's never the easy that you just buy a potential buyout stock when you think an offer is coming ad it just goes up. If it were that easy, everyone would be in this stock. 80% are institutions. That means 20% are guys like us. And there are a lot of people that if they heard best buy is getting an offer this week and I could make 40%, everybody and their mother in the stock market would be gobbling up these shares. But that's not how it works. Something unexpected will happen and try to shake people out. That's why I'm short.
For a starter BO is dated and usually never responded right away. Second, how the hack "star tribune" may know at what price BO will be? They can't. They (or whoever sponsored the article) may just try to influence rest of the stockholders that what ever is offered is great, when in reality it isn't.
p.s. Relying on the Strib is about as stupid as relying on a few bullish posts here to go contrarian. You're an amateur. You're quite possibly going to get your butt handed to you. Whereas, if there is no deal, I am fully hedged to minimize losses. Can you handle a buyout at $24? That's quite a jump from here. Not saying it'll happen, but you had better be prepared for that outcome. Manage your risk.