$300MM for Not-A-Unicorn

[Trader200K]

I've became numb some time ago to large sums thrown at Nasdaq companies with no significant earnings let alone free cash flow. I get the YOLO thing.

Last week my Son-in-Law dropped me a number of unusual volume symbols for a quick look. Most were stocks trading a few tens of thousand shares on average, BUT late in Oct almost all on his list experienced volume spikes from 50-350 million shares in a day.

The first one I opened up was ASE:UUU. A Chicago based security device maker. Smoke Detectors ... with some foreign losses and exchange compliance issues that are under repair. Nothing against them-products look fine, but their Total Shareholders Equity was only about $5 million.

No green electric vehicle angle, no lithium battery, no bio, no streaming media AI IT unicorn collaboration breakthroughs, not even a near NEST knock off ...

Yet a couple days before the Nov page turn, someone picked up 72MM shares at a hefty premium of around $4 on average, more than doubling the stock for a short while. My rough calc says they dropped almost $300 million, for a company throwing off $234,000 of cash from ops in 6 months. Robinhoodees seem a long shot.

Curiosity has the best of me now. My questions for the top dawgs here ...

1. Why would someone throw down roughly 60 times more capital than what a tiny, lightly troubled company could be valued at ... especially when it's not a Naz Darling?

2. Why would the 'investors' be in such a heated rush to plop it all down in one day rather than doing the typical don't-rock-the-boat buys most funds concerned-about-returns employ?

3. What's the clever strategy behind the curtain that is being employed here?

Please give me your plausible (and implausible) ideas about just who and what in the Hell is going on here and others that are seeing these huge, abnormal capital flows.

Best regards,
T

 

[Overnight]

....

Please give me your plausible (and implausible) ideas about just who and what in the Hell is going on here and others that are seeing these huge, abnormal capital flows.

Best regards,
T
...

I have two plausible ideas...

1. Insider info trading, something big is coming and they want to position before the news.

2. The news will be false. Pump and dump, like Hanz and Franz.

 

[JamesJ]

I've became numb some time ago to large sums thrown at Nasdaq companies with no significant earnings let alone free cash flow. I get the YOLO thing.

Last week my Son-in-Law dropped me a number of unusual volume symbols for a quick look. Most were stocks trading a few tens of thousand shares on average, BUT late in Oct almost all on his list experienced volume spikes from 50-350 million shares in a day.

The first one I opened up was ASE:UUU. A Chicago based security device maker. Smoke Detectors ... with some foreign losses and exchange compliance issues that are under repair. Nothing against them-products look fine, but their Total Shareholders Equity was only about $5 million.

No green electric vehicle angle, no lithium battery, no bio, no streaming media AI IT unicorn collaboration breakthroughs, not even a near NEST knock off ...

Yet a couple days before the Nov page turn, someone picked up 72MM shares at a hefty premium of around $4 on average, more than doubling the stock for a short while. My rough calc says they dropped almost $300 million, for a company throwing off $234,000 of cash from ops in 6 months. Robinhoodees seem a long shot.

Curiosity has the best of me now. My questions for the top dawgs here ...

1. Why would someone throw down roughly 60 times more capital than what a tiny, lightly troubled company could be valued at ... especially when it's not a Naz Darling?

2. Why would the 'investors' be in such a heated rush to plop it all down in one day rather than doing the typical don't-rock-the-boat buys most funds concerned-about-returns employ?

3. What's the clever strategy behind the curtain that is being employed here?

Please give me your plausible (and implausible) ideas about just who and what in the Hell is going on here and others that are seeing these huge, abnormal capital flows.

Best regards,
T

View attachment 245142​

News that day was:

• Universal Security Instruments, Inc. (NYSE: UUU) rose 69.2% to $3.40 in pre-market trading after the company said it received a letter from 9.9% stakeholder Activist Investing threatening shareholder action to prevent delisting and bankruptcy

It seems to have been the gambling stock of the day with volume multiples of the float.
It's not someone buying a lot but stocks being bought and sold all the time between shorts and long.
Not really a pump and dump imo, more like a game of poker being played through stock price.
Most of the time the shorts come out as winners but there also is the occassional short squeeze from hell.

More or less everyday there is a stock that has multiple float rotations, ie. Volume above the float. Mostly small and nano caps on news.

 

[maxinger]

Day traders are not interested in analyzing and trading such stocks.

Look at the chart.
out of many decades, there is only one day where the volume was very high.
Other than that day, we have to use a magnifying glass and look at the volume.
Don't need to crack our head till broken and investigate what is happening to that stock.

Just leave it to the UUU CEO, board of directors, major shareholders ... and let them do what they want to do.

There are definitely other better, more tradable stocks.

 

[MarkBrown]

probably a new biden deal under the table has been struck - not kidding in the least. you follow the money it will go back to what others have said "insider trading" something big coming. they want to say well hell i had that stock long before the got that federal contracts bla bla.

you need to read mc million on stock option spikes - same ole thing

OPTIONS AS DIRECT INDICATORS page 42-43

 

[newwurldmn]

I've became numb some time ago to large sums thrown at Nasdaq companies with no significant earnings let alone free cash flow. I get the YOLO thing.

Last week my Son-in-Law dropped me a number of unusual volume symbols for a quick look. Most were stocks trading a few tens of thousand shares on average, BUT late in Oct almost all on his list experienced volume spikes from 50-350 million shares in a day.

The first one I opened up was ASE:UUU. A Chicago based security device maker. Smoke Detectors ... with some foreign losses and exchange compliance issues that are under repair. Nothing against them-products look fine, but their Total Shareholders Equity was only about $5 million.

No green electric vehicle angle, no lithium battery, no bio, no streaming media AI IT unicorn collaboration breakthroughs, not even a near NEST knock off ...

Yet a couple days before the Nov page turn, someone picked up 72MM shares at a hefty premium of around $4 on average, more than doubling the stock for a short while. My rough calc says they dropped almost $300 million, for a company throwing off $234,000 of cash from ops in 6 months. Robinhoodees seem a long shot.

Curiosity has the best of me now. My questions for the top dawgs here ...

1. Why would someone throw down roughly 60 times more capital than what a tiny, lightly troubled company could be valued at ... especially when it's not a Naz Darling?

2. Why would the 'investors' be in such a heated rush to plop it all down in one day rather than doing the typical don't-rock-the-boat buys most funds concerned-about-returns employ?

3. What's the clever strategy behind the curtain that is being employed here?

Please give me your plausible (and implausible) ideas about just who and what in the Hell is going on here and others that are seeing these huge, abnormal capital flows.

Best regards,
T

View attachment 245142​

72MM shares traded but that was someone churning the stock. I think this is a pump and dump attempt.

 

[Trader200K]

James,
Interesting insight. I wouldn't have guessed that much activity in this one as it seemed a bit out in the weeds. Thank you for the comment.

Max,
Makes sense. It is in the weeds and not daytrader territory. So I am guessing that those associated with the company or orgs that carried them to market plus a few of their loyal opposition members are small in number, but dueling with millions of shares back and forth as something interesting to do. Not something I would have ever pictured. I would have loved to stand in the back of the room listening to the strategy/comments as that size was thrown down. Thanks!

Mark,
The thought of something nefarious did enter my thought train given the amount of repugnant incivility/dishonesty that is open for all to see, but I hope we eventually find that Americans still have the wisdom/moral chops to choose not live in the slime of billionscam/murder/pedo/psycho dystopia that seems on the horizon. But I'm not seeing much of a counter force standing up to prevent going in that direction. Civil War/Cultural Revolution has always proven suboptimal.

I'm going to follow UUU for a short to see if some event shows up. The anecdote that McMillion quotes about what happened in the case of the Southern Pac RR takeover was informative. Thanks for linking the PDF. I clearly need to dig deeper into the interaction options drive. I'm pretty ignorant of that world. Thanks for your assist!

 

[MarkBrown]

i saw mc million speak at afta about 20 years ago, he had discovered that when the daily volume of a stock exceeded it's 21 day average volume by x amount there is something behind the scenes about to happen.

some of the logic is that why would anyone buy the stock when for the money they can by more with options if and spike in price is about to happen.