I sold my last 40,000 shares today, so I'm officially out of PSUN. Not because I don't think it will go higher. But more because I'm starting to get nervous about the overall market (seems overbought to me), and I'd prefer to hold largely cash right now.
And for those that think I'm making this up, I acknowledge that 540,000 shares was a stupidly large holding for a stock like PSUN. That's why I sold when I had the chance, even though I had an inkling someone else might've been taking advantage of me. That goes with the territory when it comes to micro-caps.
I believe there was significant buying based on insider information on the part of a single entity prior to the most recent earnings release. Why do I believe this? Well, if you'll recall, PSUN was meandering along in the low $2's several weeks before the most recent earnings release. I then placed "good till cancelled" sale orders of 500,000 shares of PSUN at prices ranging from $2.60 to $3.00. This was based on my earlier prediction that the stock would hit $3 prior to the earnings release, and the fact that I couldn't expect to sell 500,000 shares at exactly $3. As soon as it was clear that those orders were out there at fixed prices and weren't budging despite daily price fluctuations, someone started gobbling them up one after the other. I don't think it was multiple buyers because I put my shares up in chunks of 50-60,000 shares, and most of them were gobbled up in one go. This would've been impossible with the kind of anemic volume we previously had in PSUN. So as my shares were being bought, I figured it was being done by someone with insider information, because nobody would be so aggressive in buying stock and driving up the price (in my opinion) if they didn't have information to indicate it was headed significantly higher. I believe the only reason they didn't drive the price up higher earlier was because there simply wasn't enough volume available on the sell side. They would've driven up the price a very significant amount to get a relatively small number of shares. Once I had assured them of large volume on the sell side, even though it was being offered at a significant premium, they grabbed the opportunity.
I'm glad I sold my stock because I needed to sell and get some liquidity out of a stock that had previously been pretty illiquid. However, I had to come out and share what I found - someone else is playing this stock with more information than either you or I. Good luck to longs in PSUN - I hope you get $4+ this summer.
It certainly seems that way. The trend over the last couple of weeks has been stronger than I'd anticipated. I would've expected PSUN to go sideways for a bit until we were about one month away from the next earnings release. To me, the steady climb we've seen signals that someone (a large, relatively sophisticated investor) is steadily accumulating shares at this level in anticipation of good times ahead. Hopefully they know more than we do. I'm thinking $3+ by the next earnings release, and $4+ within this year. GLTA.
I took the opportunity to add to my position at $1.54 and $1.55. I now have a sizable position that I'm willing to hold for 1+ year. There's plenty of risk with this stock but also incredible opportunity if you're willing to hold longer than a couple of months IMHO.
The weather is a very real driver of results for these guys. If investors buy/sell purely based on the stated guidance/range, this will continue to go down and your short will pay off handsomely. If investors buy/sell based on a more educated view of the information the company actually shared, then it won't go down, and will actually go up heading into the next earnings release. The thing is, I'm not sure there are a whole lot of clueless investors left in PSUN.
I expected them to provide guidance of +1-5% based on the new product lines, and was initially disappointed by the guidance they gave. But if you listen to the call, they are actually running positive comps in the regions that aren't adversely affected by the weather. I live in the Midwest so I know how cold it has been this year relative to last year. I just hadn't factored this into my expectations.
Net net, I think the earnings had some negative news about Q1, but actually had positive signals for the overall health of the business. As I said earlier, I think some short-term holders might sell in the near term, but I still expect PSUN to do well for the longer term holders over the next 3-6 months. We shall see.
My initial thought upon seeing the results was that the guidance was not good, and the stock would decline. However the detailed transcript of the call reveals a more nuanced, and frankly positive picture. Low to mid single digit positive comps in regions other than the center and northeast is quite good, because the weather has been remarkably unseasonably cold in those two regions. So while that may not be good for Q1, the overall trends seem to be quite positive. Pretty positive sentiment on the call from my perspective. It'll be interesting to see where we go over the next couple of days. There MAY be a bit of short term selling by weak hands, but I certainly wouldn't want to be short this stock over the next six months. I'd expect very positive guidance for Q2 three months from now.
Highly doubtful they will beat earnings. They already said how they were doing through two months, and I don't see January changing that very much. So they should basically just meet analyst expectations for this quarter. I think the stock price run-up has been driven by the possibility that the future outlook might look brighter on this call (perhaps driven by the Kendall & Kylie collection). If that happens, we will continue to go up. If not, we will go down.