You ignore the fact that this stock hit a high of 10.45 YET closed below 10 today.
If after all that price movement you think 9.89 to 9.97 is BULLISH then you are delusional.
16:37 - 825 @ 9.97
16:10 - 5,900 @ 10.18 approx.
16:10 - 9,282 shares traded @ 10.22
He was right. It went as high as 10.22 and then fell all the way back down to 9.97. It is at 10.10 AH right now. Only 36,450 AH volume so far.
AH trading is a valid indicator only when earnings are released after the close.
Negative sentiment is likely the main reason why this stock remains undervalued. I realize it's not a measurable metric but at the same time negative sentiment is higher for this stock than any other legit stock I know of on the market today.
Look at how this stock moves. People should be buying and selling this stock for 10-15% gains. This stock usually runs up 3-4 weeks prior to earnings. Other than that it tends to trade in limbo. Holding out for 15 or 16 when this stock is struggling to hold 10/share is a bad idea but feel free to disagree.
Based on record earnings in the past fiscal year this stock should have made a new 52 week high after March earnings and followed that up with a new high after June earnings. That would mean that this stock should be trading above 12 right now but it's not. Why is that?
We should all have a clear picture of where this stock is headed within the next 2-3 weeks. I follow trends/statistical probability. I'll admit different strategies work for different people. I believe that this stock is far more likely to hit 9/share than 11/share in July.
I have never been a big advocate of buy/hold. The best time to buy/hold is when stocks are at/near historic lows or were just beaten down for no reason. Opinion and sentiment matter. Look at AAPL with a low P/E and good earnings yet nobody wants that stock. NFLX/AMZN/LNKD make no money yet their stock prices are through the roof.
For the last 6-7 months SWHC has been one hated beaten down stock. It still is. Big money pushed the stock all the way down to 7.67 on Dec 18. I bought the next day. P/E and earnings were good back then too, people just wanted out of gun stocks at any cost. I think Institutions/MutualFunds will continue to skim off the top to keep this below 10 until sentiment changes.
P/E industry comparison is not that simple. Why? There are too many variables. It's hard to say how much extra value the public gives to a stock for paying a dividend, how much value is taken away due to having debt on the books, how others will view a stock buyback, how far others are looking ahead etc.
I made 21% LONG buying in the low 8s in early December. I sold on June 25. Like many on this board I thought the sky was the limit for this stock. I held this through March earnings as each floor of support got knocked out...10.00, 9.50, 9.00 and finally 8.50. Since December there has been no support above 10 which is a strong psychological level.
Strong earnings/gun demand over the past 2 QTRs were expected. Otherwise this would have shot up 10-15% post-earnings. I'm not short, just stating my opinion. If you stay long and this goes all the way up to 12 or 13 good for you, I was wrong.
*The most common mistake made in the stock market today...People have a tendency to fall in love with their stock, set lofty price targets, and refuse to get out when things start turning south. People refuse to reevaluate their position/investment. A 30% gain drops down to 20% and before you know it you're back to even.
Based on historical numbers 10 is way too high to be buying back stock. From Jan 2008 - Dec 2012 SWHC was trading below 5 for a total of about 2.5 years. Since January 2008 this stock has never traded higher than 11.25. Many people on this board are likely over-optimistic. While I don't see this falling below 8 again anytime soon I have my doubts about it closing much higher than 10.
"IBM announced a huge buyback during the Asian financial crisis in October 1997, which helped stabilize the market after a 7% plunge in the Dow Jones Industrials. This was after the stock was down huge, so it was probably a good idea to use excess cash to repurchase shares."
Best strategy is to buyback when stock is cheap, reissue when it's expensive, and net the difference. Most corporations don't operate that way mainly because they lack patience, overvalue their own company, and because stock buybacks help to inflate EPS now. This is probably why many analysts put heavier emphasis on declining revenue than earnings gains.
"More often than not, companies end up buying back stock when business is prosperous and cash flow is good-and when the stock is priced high. Conversely, when the economy is in a downturn and companies have less cash, they stop repurchasing shares at a time when they should be buying. "
Earnings, PE, and book value show that SWHC is greatly undervalued ON PAPER.
The caveat - there is no guarantee SWHC will become properly valued over the next 6-12 months before revenue/sales start to decline again. Trade carefully.
The economy and unemployment rate may never reach the lofty goals set by the FED. Can't wait forever. They need to start winding down QE3 this year and stop throwing money away.
Maybe they keep bringing up QE3 thinking that the more they bring it up, the less it will hurt the market when they finally make a move.
Sold my position today. SWHC should have announced a 2-3% annual dividend and paid off ALL their debt. Many money managers avoid non-dividend stocks. Down in AH on 500k volume is not a good sign. I expect this to close down tomorrow as well.
Agree, it will increase future EPS and WILL create a short term floor of $10 for the stock. How much has negative sentiment hurt the stock over the past few months? While I'm sure this should be above 10 right now, how much higher can it reasonably go. Whenever it gets in the high 10s / low 11s it tends to sell-off hard.
While sales can't keep increasing for SWHC, EPS should remain stable for at least 2 more QTRs and the massive stock buyback will definitely help. Based on 4th QTR earnings this stock is currently undervalued by at least 10%.
Anyone read about any analyst upgrades? SWHC has projected EPS of 1.22 and a PE of 8.
Sentiment: Strong Buy
Momentum has finally turned positive for this stock.
Should close above 10 next week, could see 11 by end of month.
A 5%+ gain on a down day in the market is never a bad thing.
SWHC closed well above the SMA(200) today.
The shelf is likely to remain the non-issue that it always was.
SWHC financials look far better than they did back in Dec 12' when it initially hit 11.25. It is currently 15% below its 52 week high. Should be plenty of upside left before SWHC turns south again.
Tender offer goes into effect Monday and is open for 20 days
7.5 million shares buyback @ 10/share regardless of current stock price.
In theory, the tender offer should create a floor of 10/share for the next 5-10 days:
-Current shareholders will wait to sell with the fallback option to sell @ 10
-Investors will buy below 10 knowing that the price of 10/share is guaranteed for 7.5 mil shares
-As of May 31 there were 11.09 mil shares short...avg volume is 1.6 million
Investors = BUY
Short Covering = BUY
Based on earnings, buyback news, and shares short why would anyone sell below 10?
April 3 DOW loses over 110 points...SWHC closes down 0.19 from 8.74-8.55 (2.22% loss)
April 15 DOW loses over 260...SWHC closes down 0.42 from 9.04-8.62 (4.87% loss)
April 17 DOW loses over 130...SWHC closes down 0.15 from 8.64-8.49 (1.77% loss)
April 18 DOW loses over 80...SWHC closes up 0.14 from 8.49-8.63 (1.65% gain)
May 1 DOW loses over 130...SWHC closes down 0.20 from 8.78-8.58 (2.33% loss)
May 22 DOW loses over 80...SWHC closes down 0.24 from 9.21-8.97 (2.67% loss)
May 29 DOW loses over 100...SWHC closes down 0.18 from 9.13-8.95 (2% loss)
May 31 DOW loses over 200...SWHC closes down 0.03 from 9.14-9.11 (0.33% loss)
The DOW lost over 200 points on Friday yet SWHC barely felt it.
Agree with the time frame July-September. I think the DJI will range between 15,000-15,500 in June with strong support around 15k. The DJI SMA(50) is currently @ 14809.70 and when it closes below 15,000 look out below.
The DJI closed today at 15354.40. The top 10 DOW stocks by weight have an average PE of 15.14.
The usual May sell-off looks unlikely. Negative news is having no effect on the market. If there is a correction this year odds are it will start by the end of August. I have a feeling it will correct in July.
"In 2013 under QE3 the Federal Reserve will increase printing from $40 to $85 Billion per month by purchasing $40 Billion a month in MBS (home-backed loans) AND additional $45 billion in 10-30 year US Government treasurys (loans) from financial institutions. This is equivalent to 20.4 million jobs per year paying $50,000 / year."
What could signal the beginning of a correction/crash?
-DJI closes below 50 day SMA
-DJI closes down 3 days in a row
-One or more countries announce that they will be leaving the Euro
-Fed announces QE3 reduction/elimination
-2012 had two separate 8% corrections from May-June, Oct-Nov
-2011 had one 19% correction from July-Aug
-2010 had one 15% correction from May-Jul
-2009 had one 36% correction from Jan-Mar
-2008 had a drawn out 60% crash from May-Dec
-2007 had two separate 8% corrections from Jul-Aug, Oct-Nov
-2006 had one 8% correction from May-June
-2005 had one 9% correction from Mar-Apr
-2004 had only minor corrections
-2003 had one 17% correction from Jan-Mar
-2002 had one 35% and one 20% correction from Mar-July, Aug-Oct
-2001 had one 14% and one 24% correction from Mar-Mar, Aug-Sep
The higher the DOW goes the better...16k looks doable right now. Could see this continue to go up for a few more months. Expecting a minimum 10% correction later this year.
Looks like it will be a while before the wheels fall off. The Fed continues to spend $85 billion a month and bad news in Europe is still being ignored. No reason for the DJI to head down atm.
Fundamentally this looked like a real bargain back in December. I will not hold a stock through earnings again in this market. You are probably right but I won't day trade this because I feel like the second I sell it will start trending up.
I wonder if a big stock market correction would help/hurt this stock?
If management was the real issue then why was SWHC trading above 10 from September 7 - October 18 back in 2012? I still think the problem is not management, it's stock manipulation. If you were right wouldn't there be news articles all over the place? Point me to one of them.