The featured stock is being dumped by insiders at an alarming rate. What do they know about the Company that is being ignored or overlooked by the market? In the last three months, insiders have sold 7.2 million shares vs. “buying” 535k shares. The buying has largely consisted of the conversion of restricted stock units granted as compensation into tradeable shares which will be then be sold.
Jim Cramer has a table-pounding buy on this stock. That’s usually the kiss of death. Cramer calls this company on of the best stories for 2016. For those of you who are unaware, Cramer is one of the best contrarian stock indicators possibly in history. More often than not, a table-pounding buy issued by Cramer is the kiss of death for a stock. Perhaps the best example of this was his strong endorsement of Bear Stearns shortly before Bear Stearns completely collapsed. This company won’t collapse but it is extremely overvalued, especially in the face of a economy headed into a deep recession.
I also have revisted to ideas from earlier issues, one of which is now down 17% vs. 10% for the S&P 500 in the same time period. Finally, I have a quick-hit short sell idea on a company that is highly overvalued and reports earnings next week. I also had detailed ideas for using puts and calls to replicated shorting the stocks, with specific put/call suggestions.
You can subscribe to the Short Seller’s Journal by clicking on this link: SSJ or on the image below: