Just pointing out that the REIT approval doesn't have anything to do with adding shareholder value.
That is the nature of all stock boards. When the stock was in the 7's and I wrote that I'm starting to buy, the shorts slammed me and the longs praised my astute decision. When I liquidated my holdings in the low 9's, the shorts though it was astute and the longs thought it was a dumb move. Now I think the stock is in the gray zone...meaning that the potential return is not worth the risk and investors should demand a lower price before buying additional shares. I'm certain some longs think this stock will go to $15.00 a share in 12 months and they may be right. However, right now, there are better places to invest than WIN shares. Now if the price should drop to the low to mid 7's, then it might be worth it.
There is nothing wrong with a 0.70 dividend. However, the question is what is the yield that the market is going to demand for that 70 cents. If the market demands a 10 percent yield, then you're looking at a $7.00 combined stock value. If the market preceives no shareholder value, then it may demand the current yield of around 12 percent. If that is the case, you're at a combined market value of $5.50 per share. This is not a safe company to invest in at the current share price. I'm hoping that there will be a backlash to the downside that will reduce that risk and give me a chance to buy in at a better price range.
The SWHC revision was good but the revised revenue numbers for this fiscal year is about 16 percent lower than the actual revenue for the last fiscal year. It's good only because it could be worse. On another point, I find it amazing that someone actually thought this RGR pop could have been caused by the new Sniper movie. Never overestimate the intelligence of the average investor.
I believe we are in the same boat as far as the dubious "value added" prospect of the REIT conversion. I'm very skeptical that the REIT conversion will contribute anything extra to the shareholders to compensate for the dividend cut. The REIT tax savings are not going to be much in WIN's case. My concern is that if the market values the combined post WIN yield the same as the pre REIT yield, you're looking at a stock price at around $5.50 a share. Anything north of $5.50 will be the market's premium on some sort of reverse synergy benefit of the two new companies. Hard to tell what will happen. If the price should drop below $7.50 before the spin off, I might start to nibble then. With this company at this price, it's not the time to be bold.
If you would bother to read my previous WIN related posts, you would find that I bought a boat load of WIN shares below $8.00 a share. I also sold out around $9.15 a share as the stock price increase. Consequently, WIN has treated me very well because I don't over pay for shares. If you want to buy WIN shares at this price, have at it. It may very well turn out to be a good investment. However, I personally don't find enough reward to justify the risk. Keep in mind, that not too long ago WIN was a sub $8.00 stock. Has WIN financials improved since then. The only thing that has changed is the REIT spinoff and I don't see that as a net positive. Patience is a virtue. Wait until the price drops further before building a WIN position.
The volume is a little light and the price movement thus far is about 1% above the market. The other telecoms are not moving as much as WIN. Don't think there's anything going on. Maybe investors are just jumping into a beaten down stock on an up day. Is anyone on the board buying today and, if so, why today?
You shouldn't buy any stocks if a 2.5 percent drop upsets you so much. The stock market isn't for everyone. There's other places to invest..
Diversification has its advantages. CVEO is a good example why you should have at LEAST 10 stocks in different industries if you're going to have a significant portion of your investable wealth in the market.
If you are a new investor, you should stay away from this type of investment. You are purchasing a bad stock in a deteriorating industry. If you are looking for a quick trade, you are hoping that the "bigger fool" strategy will work for you. If you are playing an oil rebound, you are hoping that oil rebounds enough so oil companies stop cutting their capital expenditures and , thus, increase their drlling production to the point of needing a company like Civeo. This must happen before Civeo goes bankrupt. If you want to invest in a deteriorating industry, invest in deep pockets in the industry not companies like Civeo. Civeo is only an investment on the upswing of the oil industry not the down side. The only way a person should invest in a company in a situation like Civeo is if you have a detail knowledge of the industry, the company's contracts, the company's assets, the company's liability. In other words, you would need to be a knowledgeable insider to have that type of information. So my advice, is to sell the 3K shares. If you like to gamble, invest 1/2 of the proceeds in Hal, Slb, Cop, and/or XOM. Then take a trip to Vegas on the other 1/2. If you don't like to gamble, spend the Vegas money on a nice trip for you and your spouse (or significant other). You'll be money ahead.
I posted 3 or 4 weeks ago that I thought the market would value the post split WIN at a combined value of $7-$10 a share. Consequently, as the price drops towards the lower end of that valuation, I become more interested. Still have a ways to drop but starting a base in the mid 7's may work out for an investor who is willing to buy small increments as WIN drops below $7.50. If it doesn't get that low, the risk/reward is not there for me.
Obviously, $9 was not oversold. Consequently, your conclusion is based on wishful thinking. You may be right or you may be wrong. Bottom line is not to try to catch a falling knife. Just wait a few days and see what shakes out before jumping in.
No one knows. You should go to Las Vegas with your money because you're just gambling.
You made the classic rookie mistake of thinking that just because a stock's price drop, it must represents a buying opportunity. Unless you have a crystal ball and judge how the market will reprice the shares in light of the dividend elimination and the new future forecast, you are just guessing with $100,000 on the line. You might be right and the price may come up to a level necessary for you to break even or make some money. Overall, though, it's a losing strategy. Hopefully, this will be a learning experience for you. Given the reason for this drop, it's better to give the market time to reprice the shares and then decide if the stock is a worthy investment.