I sold some yesterday - everything I bought on Feb 20. I simply did not understand why several members of the management would sell at the same time. I am a bit suspicious but keeping the bulk of my shares at the moment. But I'll be watching closely to exit the position if needed.
This pullback is totally unnecessary but provides a good short-term opportunity for someone wanting to make 7-10% in the next one month. I'm pretty sure will see $17 in 2-3 weeks unless the overall market drops significantly. There is no reason why RDN should be trading at this level...the company is solid.
I would love it if we go above 20 as I stand to make good money even with a reduced position. The problem with RDN is that there are too many short sellers relative to other stocks and this is one of the problems. 41 million shares (22%) are short and we need the sqeeze to move RDN above the 17.50 resistance.
On the other hand, home prices have shot up considerably largely due to non-US investors and now they are not selling as fast as they used to. The home prices need to come down while interest rates are low and then we'll see some good action. I believe in RDN but as you said, I'm being more conservative or realistic with my expectations.
$20 is only 20% away and very achievable. At a macro level, we need a strong catalyst to take it there and the only one I see is Fed announcing it's exit from MI causing shorts to cover to push the price to $20. From a timing perspective I do not see $20 in the next 6 months and we'll be moving sideways for some more time and RDN will follow the broader market. The only negative impact on stock price is if interest rates go higher ...even a slight increase will cause RDN to go down 10-15% in the short term but it will claw it's way back to the current range. I see a 30% upside in the next 1-2 years and a relatively safe long term investment for a portion of your portfolio. I have both MTG and RDN and together take up 40% of my portfolio...I will look to reduce to 15% in the next 1 month.
I believe $12 is definitely possible by year end. But I'll be out around $10 as I believe there are better opportunities with the oil stocks slumping which has created a good opportunity in some really good companies.