Article just appeared in WSJ saying coffee consumption is exploding in China, says coffee is the one commodities trend that is likely to reverse course and head higher as a result. They cite the current low prices as a result of a fall in the Brazilian currency which makes it attractive for those farmers to sell their beans as opposed to stockpiling them.
Given the size of China's population and the rate at which coffee demand is growing there, longer term that is a catalyst for higher coffee prices and more demand for some of JVA's offerings.
I will add that I doubt whether Carl Icahn Enterprises is the actual buyer here. However, everything this guy says up to this point has been spot on...and has very deep pockets. On the small chance it really is a representative from his company making the purchases, all it would take is 1 tweet from the man himself to rock this stock's world and send the short sellers into overnight chaos.
According to the poster, assuming he is telling the truth, JVA has become one of Icahn's largest micrrocap holdings. He could buy this company with petty cash.
Our friend Icahn may be buying the rest of the week. A big buyer stepped in near the close, took the price from $4.16 to $4.38 in minutes. Then after the market closed, he posted that it was him and he would be buying the rest of the week. I saw the trades go through and everything he has said since he started posting has been true. Remember that he single-handedly took the stock above &5.50 recently. Whoever he is, he owns a good percentage of the company.
JVA was still profitable despite a most challenging quarter where coffee dropped 75 cents. During this quarter, they also started the new tea initiative and began penetrating new retail markets, in particular the northeast and Texas with Cafe Caribe brand, all of which has associated startup costs.
It dropped to $4.76 with less than 1 second to go. That was the lowest it had traded in hours. It was only a couple of buys at the closing bell that reversed what happened on Friday. Somebody still tried to drop the price but the market was too strong today.
Look at a candlestick chart of JVA's price, you will note that the stock always has a tall shadow and closes near the bottom of the candlestick almost every single day without exception. That proves they are daily pushing the stock lower into the close.
Watch level 2 real time quotes on any typical day from about 3 pm into the close. Note what happens to the bid ask and how it changes during that time. Especially the last 10 minutes, that's when the stock is pushed down as far as possible to take out the bids and create lower bids. Just minutes and seconds before the bell closes, they lower the ask by offering shares below market value so anybody trying to buy the stock actually lowers the price.
Can't drop the price that low because it would take way too much money for them to do it. Too many people buying even at current prices. That's why they slam the stock in the final 10 minutes each day, it costs them the least amount of money to do it. If everyone started buying the stock in the final 10 minutes, it would screw up their plans.
A good or great earnings report will naturally cause the price to spike and they will hide in the weeds like the slime that they are. Only when the volume dies down would they re-emerge and do it all over again.
For every $1 the buyout price is lower, the buyer saves $6 million. It is definitely worth it for them to purposely lose $100,000's now to push the price down because they will make way more in the end. But that's how you know this is a serious buyout attempt upcoming because they are committed to driving down the price.
Also, note how a lot of bashers showed up all at once a few weeks ago. That is also part of the manipulation. I don't know where they come from but they came here en force at the same time.
What will likely happen is they will offer the Gordon brothers and directors a fantastic separation package, or some other wonderful compensation and to stay on with the company as privately held instead of public. That will cause the Gordon brothers to recommend to all shareholders to accept the buyout proposal and also to vote their own personal shares.
Things can go wrong for the buying company. Another suitor can come forward and outbid them and drive up the price. That could happen before or after the buyout proposal is made. That's another reason why they don't want to spend millions of dollars now driving this to the $3's because it's not a lock that the Gordon's will accept their offer and that another buyer will emerge.
I have insight into this process due to examining court filings from other buyouts which detailed the process when I already had suspicions before the public was informed.
This is what I wrote on Aug 26
"Let me tell you what I think is happening. This comes from experience because I was involved in the takeover of another small, low float company. The trading patterns I am now seeing with JVA happened exactly the same way with that other company.
Trades occurred every day at exactly 4:00 to cause a downspike, just like is happening with JVA. Shares were offered lower than the current market price which caused any market order purchases to cause the price to go down, just like is now happening with JVA. "
I will repeat this. Again and again. JVA's stock is getting hammered every single day into the closing bell to purposely make the stock go lower. Nobody believes me but yet it is happening daily just as I said it would. Somebody is purposely losing money pushing the stock lower so they can save millions buying the company at a lower price. It is probably a private equity firm but could be a major such as GMCR or Del Monte.
This stock action tells me the sale of the company is drawing nearer. Trust me, I am very, very familiar with this scenario with similarly low float, low volume companies about to be bought out or taken private. JVA is being manipulated for this purpose.
Interesting timing. JVA released earnings last year on Sept 10.
Wonder if earnings and conf call will be after or before the conference? Sept 15 is the deadline.
Earnings are in less than 2 weeks. Not much they can legally tell you. JVA still does some hedging and that will be a loss this quarter due to how much coffee prices dropped but nothing to the extent it would have been since the Gordon's stopped speculating in coffee futures.
Been a long time since commodities rallied. If by some chance oil has bottomed, that would likely lift all commodity prices including coffee and would increase buying pressure. A lot of beaten down commodity companies began to snap back hard today, JVA included.