One thing you miss though is that heavy put buying pushes the price down. The options market maker goal is always stay delta neutral. He does not bet on price movement in any direction. His goal is to create a system which has positive profit expectation in the long run. So for every put sold by the options market maker they need to short a certain amount of the stock to protect against the downside. And options market makers are exempt from shorting restrictions. They are allowed to short the stock naked as much as they want.
Some moderate put buying will not affect the price very much. But massive put purchasing volumes in low cap stocks will noticeably push the price down as we saw yesterday. Several days before the price collapsed on MW report there was a record amount of puts traded. As we know it didn't turn out bullish at all in the end.
It's a technical bounce. It is bouncing in a wedge for now. And is always resisted downtrend. Don't be fooled.
Before it breaks the downtrend which started back in 2011 don't even think of buying cup and handle or whatever other pattern. Only bounce play and then reshort again.
It is still overvalued at this price. They presented the company as profitable for the IPO. Read the IPO prospectus. They claim they turned profitable this year. And the market priced them according to that false information.
But after 2 earning reports as a public company it is obvious that they are losing money. And what is worse the sales are falling. They also keep missing their own guidance. Each quarter they give lower guidance than expected by the analysts and somehow manage to miss even that lowered guidance.
Their business model is obviously under huge pressure from competitors. There is nothing unique. If you google: Chinese internet shop you will see hundreds of shops with similar websites. The margins are narrowing.
It will go to $5 eventually. It is dead money for many months or maybe even years.
Sentiment: Strong Sell
might take several months, might take a year. Nobody knows.
Pharmaman is saying that the dip itself presented an opportunity. He posted that he bought in the 8's and 9's so he is already up huge. It might be hard to sit through all these swings. But the uncertainty is still hanging over the stock and creates huge volatility. Only time can heal it. So do not expect a fast come back
The article seems to say that Atlantis was attempting to support the price during the fall but they yet to report if their position has changed significantly. Most likely they were trading in and out of the position to squeeze out the shorts. I.e buying aggressively to push the price higher so that the shorts started covering and then selling to them shares slowly when they are covering.
Rinse and repeat until there is not enough covering momentum left. I doubt many institutions would want to increase their stake under such allegations. Longbow traded in and out. They didn't want to hold. I think it shows a general attitude among the institutions at the moment.
The most funny thing is that you were cheering exactly in the same way on the NQ's boards not long ago. That the shorts are about to start covering. A short squeeze was about to begin. And then the stock just collapsed 50%...
Another very good indicator is a number of funds which report owning the stock. It has been steadily increasing. In Q3 the number of funds owning the stock increased by 22 from 282 to 304.
It is always a very positive development for a stock when the size of the institutional ownership increases.
Though it could look as a concern I believe there is an explanation for this somewhere in the text. Or probably management has already explained it and it is not an issue.
In any case attempts to find mistakes in their 20F report are futile. Even if you assume that they are guilty of accounting fraud it is unlikely that you can catch them just from the texts they submit to SEC. I mean who would make such obvious mistakes. Even if you cook books you will make sure that all the numbers add up.
I think the only way someone can prove anything is if they show the inconsistency between what is written in the text and what is in real life. So you need to go to China and do a massive research of channels, payers, find their users and so on. So stop trying to fish accusations just out of their 20F. You will not find anything there.
And you were told that it's because they cannot sell anything. There is a lockup. Not possible to sell
I have researched into the company. And people often confuse different metrics. They classify all accounts into 3 categories:
1. Registered user - a user who ever downloaded an app and opened it on his/her mobile phone, or opened an already pre-installed app on his/her mobile phone. If you have 3 phones and open their app on each they will get +3 registered users from you. So 450 mln. is the total number of phones on which their app was ever opened at least once.
2. Active user is a user who opened or updated the app this month. It also means that all registered users are considered active users for the first month. If they do not open or update the app next month they will just remain registered users and not active users anymore.
3. Premium users. Users who have a subscription to the premium version of their app which includes some additional features not available in the free version. These are the users from who the company receives money directly. And the premium accounts are very few. I forgot the exact number but it is in the single digits of millions.
The deal with Samsung is big for NQ mobile but it is small for Samsung. There are hundreds of different suppliers of software and parts for Samsung phones. How many do you know? How many suppliers of parts do you know for the Apple's iPhone? Samsung is going license NQ mobile's antivirus solution to integrate into its mobile security app. It will still be called Knox or whatever but partly will be licensed from NQ.
Many games developers license Unreal engine for their games and pay Epic money. It's a normal practice in the software world.
I cannot see how it might improve the situation long term. It will create noise that's it. Similar to the noise that Macquarie's note created today. Retail investors will cause a pop in pre-market which will be shorted again.
Any credible third-party (an auditor or an investment bank) confirms to the public that the company's finances are absolutely as stated in the reports nothing will change. No institutional investor will touch the company until this matter has been clarified. And without the institutional support the share price will only go south.
I am refuting this claim as false because I downloaded it on my ipad and played it. Not that I am a big specialist in iOS games but it looks high quality to me.
Anybody can publish an article on SA including you. Goldbaum is short so he is feeding the sell off momentum with such articles
I think they once explained the difference between REGISTERED users and ACTIVE users. A REGISTERED user is a user who used the app at least once. As the apps are preinstalled on the phone. If you open it you become a registered user. If you have 3 phones and you open it on each phone for NQ it will count as +3 registered user.
ACTIVE users are the users who are using the app constantly, updating it and so on. So it is probably not that far from truth that 45%-75% new phones opened the NQ security app at least once to see what it is. And only 11% are using it on regular basis
Could you please short that pop in the pre-market? it's 8% up already.
Free money for you! GO GO GO!
Maybe for these reasons QIHU reclassified all their cash into lvl 1. I checked their 20-F statement and all their cash is lvl 1. But could also depend on the auditor. NQ has PWC and QIHU is working with Deloitte.