OTC Grey Market means that, in effect, NEWL has decided to GO DARK. There will be no news whatsoever. It is not required or expected, now does NEWL need to or has incentive to offer news knowing that there is no bid-ask for its security. All that flimsy PR prospects are henceforth in the past. Trading on the GREY MARKET is why the stock crushed by 70 percent as opposed to the typical 40 -50 percent decline on the first day had it been on the Pink Sheets. This is worst.
It is already trading on OTC 'Grey Market' which is lower than OTC PINK (or PINK SHEETS". If it was on trading on Pink Sheets, it would probably have been down only 50 percent on the first trading day.
Your screen name, 'stockguru' is a misnomer. You may consider 'low education stockguru'
OTC, Other OTC or Grey Market
Is simply at the extreme bottom of the multi-tiered OTC market place, far below OTC PINK SHEETS. Unlike PINK SHEETS, here broker-dealers are unable or unwilling to offer bid-ask. As for NEWL offering any public PR, forget it. It is not required or expected or will make any difference. As of today NEWL has, in effect, gone DARK. That is why it is down % 70 percent the first day, as oposed to typical first day decline on PINK SHEETS. In two more days it will register total of 90 PERCENT loss. Thereafter, if you are lucky, a mild bounce followed by massive decline to .03 - .05 cents one month hence, until it disappears.
Definition of GREY MARKET:
"OTC", "Other OTC" or "Grey Market" is a security that is not currently traded on the OTCQX, OTCQB or OTC Pink marketplaces. Broker-dealers are not willing or able to publicly quote OTC securities because of a lack of investor interest, company information availability or regulatory compliance.
Absolutely YES; once liquidity on the Gray Market where it is now trading freezes and even gamblers like you finally throw in the towel, in one - two months it will be .03 cents stock. On the other hand, if NEWL announce unexpected bankruptcy, it could be there much sooner.
This is nearly what always happens to these allegedly fraudulent scams, with multiple halts, etc. on their way to oblivion.
Typically widely perceived to be allegedly frauds/scams like NEWL, when such securities come out of the second NASDAQ halt, they lose about 85 - 90 percent of stock price during the first three days. Thereafter, there is a tiny bounce, only to reverse days later. Within weeks either unexpected bankruptcy is announced or gray market freeze hits them hard again, etc., the gamblers through in the towel, the stock is trading at .03 cents on the way to the dust bin of history.
While the UCTT beat by .03 and came the top of estimate of revenue, while it guided slightly lower for Q3 and refuse to offer formal guidance for Q4, in the conference call both CEO and CFO several times hinted at a very strong Q4 and 2015 Q1. Here is why:
(1) In response to several analysts' questions, Roth in particular, both CEO and CFO said that based on signs of uptick in shipping within the semiconductor industry, still nearly 80 percent of the UCTT business,, semiconductor will pick up substantially in Q4 and 2015 Q1. This will directly translate into significant upturn into UCTT revenue for Q4 and 2015 Q1. QUOTE:
“It is highly likely that we would see growth in the fourth quarter and beyond.”
(2) The non-semi sales will pick up in Q4. QUOTE: “The non-semiconductor sales decline in Q3 is the result of order timing with our customers and not the loss of any market share.”
(3) The percentage of revenue from Asia is expanding fast. QUOTE: “Finally the percentage of revenue coming from our Asian operations increased to 33% in Q2 compared to 26% in Q1.”;
(4) Growth in smaller medical segment is accelerating. QUOTE
Expect Q4 and q1 2015 Earnings to be robust because SGA will remain low and margins will pick up as revenue ramps and the shift in manufacturing to Asia is going very well and will boost margin. The CEO hinted at achieving 18 percent.
For value investors tomorrow is a huge buying opportunity on any weakness. Could double in 9 months, as Q4 and 2015 Q1 earnings and sales ramps up. CEO refused to give formal guidance for Q4 but hinted very strongly at significant rebound.
TWO CONSECUTIVE HALTS by NASDAQ means that it will only re-open on the PINK SHEETS. The stock will crash in unprecedented way because there is no transparency, investors in effect accept state of trading devoid of legitimate financial numbers, thereby fraud is rampant, the spread between the bid-ask widens. Worst, pretty much all of the Delisted securities that end up on the PINK SHEETS end up in bankruptcy.
Experienced shorts know this and will not cover. Smart longs will sell, the small time inexperienced retail longs, most on this board, will continue to gamble and ultimately lose.
VERDICT: Whether it will be .50 cents or 1 dollar is immaterial. Since the balance sheet is utterly bankrupt, even, swing traders ought to take a pass on it because with just $ 31 dollars in Unrestricted cash and 2271 in Total Cash and absolutely no way to raise fresh capital, given the dire PINK SHEET circumstances, etc.the company can just as easily announce BANKRUPTCY- Zolatas and his cronies at MPG/HANOVER got paid in full already, thanks to the American gambling retailers.
(1) Rare two consecutive halts in very short order, signal of forthcoming severe regulatory action;
(2) Harsh NASDAQ language- NASDAQ saying it will not left Halt until it gets all the requested information to its 'full satisfaction'.
(3) In the Jaws of NASDAQ, NEWL spit in the face of NASDAQ: By 50:1 reverse split, to get around the minimum bid rule; it does so by first issuing 317 million additional shares, part but not all due to Ironridge,and than reverse splitting, while NASDAQ hearing is upon it. It confirms NASDAQ suspicion that NEWL is trying to use seemingly legal tricks to skirt NASDAQ rules. NASDAQ's premise for first HALT that NEWL violated 'public interest concerns' with allegedly fraudulent PR is further confirmed
VERDICT: after a long halt, NEWL re-opens on PINK SHEETS.
Sorry, I warned you 20 times plus about the risk of any press release or action before the hearings can lead to halt followed by delisting. It came to pass.
My pleasure. I also suggest you read the July 16 very positive Seeking Alpha article on UCTT (Yaho0) making a case for intermediate term double digit price appreciation up to % 50 percent. Read also my next message on why UCTT is likely to beat Q2 earnings/sales estimate.
Two halts in a row, NASDAQ saying it will not left Halt until it gets all the requested information to its 'full satisfaction', spiting in the face of NASDAQ by 50:1 reverse split, to get around the minimum bid rule by first issuing 317 million and than reverse splitting, while in NASDAQ's jaw, all say one thing: the stock will go straight from the halt to the PINK SHEETS.
Earning Per Share Estimate is .20; analyst have rounded the average .195 to .20. Revenue estimate is the exact midpoint range or $ 130.5 million.
I think the company will beat both; certainly the EPS number. At a minimum .21, possibly higher.
REASON: The CEO will absolutely positively lose all credibility if UCTT miss two consecutive guidances. There is no excuse for offering bullish guidance half way into the quarter in question and than miss it. This will reflect extremely negatively on the CEO before his own board. Therefore, I have a strong hunch that when he offered guidance he was conservative- very conservative as he announced the first quarter numbers based on aggressive guidance and the PPS took a big hit. He is not going to repeat the same mistake twice
The first quarter revenue number was spectacular. On the EPS front, the company came up short by a couple of pennies. However, since the market was led to believe that gross margin will be comparable to the previous quarter, the ax came down hard on the PPS, or down from high of $13 - 15 trading range to the PPS today. However, gross margin of 16 - 17 percent is doable because the CEO has given up to 18 percent upper range. At that range, the company should be able to comfortably deliver on the earning and sales estimate.
Good news is that Q1 is fully in the stock price plus in terms of P/E multiple relative to sales and earning growth rate year over year, the stock trades in the 'value' category- VERY CHEAP. Thus, if I am correct, expect a big bounce in PPS, come next tuesday.
But to no avail. Swing trade is great when you only have to worry about company Fundamentals risk ( bankrupt balance sheet) and market risk (extreme high beta). But, when you add Regulatory Risk, that means any hour or any day, the NASDAQ bureaucracy could announce the devastating risky news. This is no longer swing trading or even gambling: imagine you are at a casino and an additional risk you have to bear is that any hour the casino can be shut down, all your winning frozen and there after auctioned at half the price for starters; when all said and done, 80 -95 percent loss is inflicted on you. Would you still gamble? of course not, unless you enjoy jumping off a cliff.
All I can say is that when it comes to shareholders communication and informing owners of the company, UCTT's management is the one of most insular, arrogant, incompetent and uncommunicative out there. In the absence of even a sniff of news in the last several months, it is no wonder that some are selling out of fear.
Since it is a very low PE stock with even lower analysts' expectations, even barely meeting the estimate could cause a significant bounce in the PPS. And, if the gross margin recovers by a slight margin, there could be the start of a sustainable uptrend in the stock price. We shall see.
In the jaws of NASDAQ. NEWL wouldn't dare issue one of those bogus PR (ship, mines in Kentucky, etc.) until after August 24, final day of "determination' decision. NASDAQ stated that it has public 'interest concern' with allegedly fraudulant press releases, in addition to the market cap and $ 1 minimum bid.
So no news. Will be DELISTED regardless.
Such reminders are absolutely essential. Tomorrow if drops another 20 -30 percent, knowing NEWL it will, you need 100 percent or more to recoup your investment. The point is that there are so very few opportunities to make 50 or 100 percent, yet so easy to lose that on any two days in NEWL, that one should not permit losses to go down that far. Cut your losses very very tight.
Longs should NOT EXPECT yet another bogus Press Release ( mines, ships, capital and all the rest) because NASDAQ axe will be swift, sending NEWL to the PINK SHEETS. Hearing is on July 24 and NASDAQ 'Determination' no later than August 24. Until than NEWL is utterly in nasdaq's jaws. Remember that NASDAQ key concern was NEWL's allegedly fraudulent disclosure, i addition to violating market cap and minimum bid rules.
Ironridge will request self-help shares to indemnify the 2 million accumulated DIVIDEND which NEWL never paid.
NEWL total cash, per 20F, is $2271. NEWL 'Long Term Restricted Cash' is ONLY 31 DOLLARS. Thus, NEWL has on a daily basis only $ SIX DOLLARS available for operation on an annual basis. With negative equity and no cash, it stands to reason that near to intermediate term NEWL will completely flounder and file for Chapter 11.
(1) Ironridge is owed accumulated 2 million in dividend which, per judge's ruling, NEWL must pay or IR 'self help' share hit the market, a 20 percent dump. NEWL has no cash- $ 2271 total cash;
(2) It is net equity or net worth or book value per share is still negative to the tune 21,5 dollars per share, thus a bankrupt balance sheet;
(3) DELISTING IS A CERTAINTY: NASDAQ expressed concerns about Fraudulant press releases, in addition to the other minimum bid and 50 million market cap. NEWL is in violation of two but the minimum bid will also be below $ 1 soon,
It's intrinsic value has been blown to smithereens or near ZERO with multiple 50:1 Reverse Split. Adjusting for all the splits, the company has close to 100 BILLION SHARES; the biggest in the history of any stock market on this planet.
If history is any guide, the stock will close below $ 1 today or tomorrow and will be just a few cents before the July 24 NASDAQ hearing. No regulatory agency will fall for this BS splits, NASDAQ will delist promptly.
NEWL's allegedly brutally corrupt Zolatas and his deputy know all of that, they are just exceptionally good at creatively perpetuating alleged borderline 'fraud'.
Longs Can not, AND SHOULD NOT, hope that NEWL will issues some bogus PR about something (ship, mines, new alleged financing, you name it) because the NASDAQ hearing is on July 24 and NASDAQ Determination up to August 2. NASDAQ will send NEWL to the PINK SHEETS promptly if another one of those bogus PR is released.
Regardless, on August 25 or sooner, it will trade on the PINK SHEETS. Mark this post.
(1) Ironridge is NOT paid off because NEWL owes Ironridge nearly $2 millioN in accumulated dividend, which the judge ruled in its favor, but NEWL has, per 20 F, only $ 2277 in cash. Thus, hey can still dump additional thirty percent of shares outstanding on the market; a gigantic dump;
(2) Until August 24, the final day of NASDAQ 'Determination', NEWL wouldn't dare release any bogus PR, least it risks sent to the PINK SHEETS by the mighty NASDAQ.
The tragedy is that 2 month again there were about 10 million shares, post 50:1 split; ballooned to 325 million shares and now is back to 6 million with another 50:1 split. This should be trading at .20 - .25 cents per as the intrisic value has been blown to smithern or near ZERO.