WHX Down Nearly 25% In A Day (GSUS MARKET GURUS COME IN)

[LuckyStrike]

Yes I know this isn't the finance section, but I'm looking for advice within the next couple hours not next couple days.

I have held WHX since it was 10 bucks, my best performer when it went to 24 and pays a 30% divvy the whole way. To me nothing seems out of whack for this Trust, P/E of around 6 and in a great sector (oil and nat gas)

So today a report came out lambasting this stock and it's down 25% in a day. I've had this happen one other time when I owned WIN and a report came out and it the price fell at least 50% and rebounded and more in a week. The entire time I kicked myself for not jumping in on the major dip.

I've done reasonably well in the market (steadily beat the DJIA and stayed in positive territory as a whole in my portfolio with low double digit dividends)

I know there are GSUS'rs way more involved and way more knowledgeable about the market than I am and so I come seeking advice.

Should I buy in at this 25% dip (50% higher than my initial buy in price)? This money is in a Roth IRA, and even if it wasn't it's not big money anyways. I can sleep if the trade doesn't pan out. Or should I just ride it down and count the 30% divvy as a decent return?

If I do stay out of it, does anyone have anything that I should put on my radar?

[chad]

starting in feb, they're going to be dumping 25 billion PER WEEK in until they reach 200 billion. i expect everything will ramp up over the 8 weeks, i'd stay long.

http://www.zerohedge.com/article/here-comes-another-25-billion-excess-weekly-liquidity-ramp-stocks

[LuckyStrike]

Here is the report that hammered the stock

http://www.citronresearch.com/index.php/2011/01/24/another-stock-only-a-computer-could-love-the-sequel/

[osoab]

So they are near the half-way point to the exhaustion of the trust proceeds.


As of November 2010, this trust, established in 2007, has now produced and sold about 43% of its allocated resource in just 11 quarters. (3.54 MMBOE of its net interest of 8.20 MMBOE) At current run rates it will pass the “half-gone” point next quarter.

If its current production run rate is maintained, the trust would liquidate in just 15.3 quarters. However, production in mature wells tends to decline, so the payout rate may decline and stretch out over a longer timespan – but this wouldn’t add to its value….it just delays when the shareholders get their returns. While energy prices might be higher in outlying years if the payout slowed, production costs would burden those lower yields. A longer payout path also reduces the net present value of the income stream. The bottom line: the timeline is not friendly to investors either way.

The volume today looks like the all time high, over 3 million traded. The IPO didn't even make that. Looking at a couple of other energy trusts, I didn't see the move like this guy ( I didn't compare them thoroughly, just price action).
It also looks like WHX had the same down spike after a negative rating in May went from 22 to 16. It then rebounded.

Tough call. I don't think I would I would buy in unless I didn't have another stock I was looking at picking up. Meaning the miners and the knockdown that has occurred for the past 3 weeks for them.

[LuckyStrike]

starting in feb, they're going to be dumping 25 billion PER WEEK in until they reach 200 billion. i expect everything will ramp up over the 8 weeks, i'd stay long.

http://www.zerohedge.com/article/here-comes-another-25-billion-excess-weekly-liquidity-ramp-stocks


I agree on the whole, although I think QE2 is already priced into the market.

This stock though is down for non typical market reasons. This is by a wide margin the largest swing I've seen in it's history. The article brings up some very interesting points, points that I lack the knowledge to accurately assess.

[LuckyStrike]

So they are near the half-way point to the exhaustion of the trust proceeds.


As of November 2010, this trust, established in 2007, has now produced and sold about 43% of its allocated resource in just 11 quarters. (3.54 MMBOE of its net interest of 8.20 MMBOE) At current run rates it will pass the “half-gone” point next quarter.

If its current production run rate is maintained, the trust would liquidate in just 15.3 quarters. However, production in mature wells tends to decline, so the payout rate may decline and stretch out over a longer timespan – but this wouldn’t add to its value….it just delays when the shareholders get their returns. While energy prices might be higher in outlying years if the payout slowed, production costs would burden those lower yields. A longer payout path also reduces the net present value of the income stream. The bottom line: the timeline is not friendly to investors either way.

The volume today looks like the all time high, over 3 million traded. The IPO didn't even make that. Looking at a couple of other energy trusts, I didn't see the move like this guy ( I didn't compare them thoroughly, just price action).
It also looks like WHX had the same down spike after a negative rating in May went from 22 to 16. It then rebounded.

Tough call. I don't think I would I would buy in unless I didn't have another stock I was looking at picking up. Meaning the miners and the knockdown that has occurred for the past 3 weeks for them.


Any miners you have your eye on? I hate having money in cash so I'm looking to buy something. I've thought about going for broke since the amount of money isn't going to break me by far.

[LuckyStrike]

Anyone else? I'd like to do something before I go to bed.

Another option I considered is, sell my current shares (I'm still up over 50% plus 2 years of 30% dividends) wait for this to blow over, if the stock starts to shake off this news than buy back in. Or if it doesn't than I still get out with a decent return.

I'm with IB so the trade is super cheap.

[LuckyStrike]

Well here is what I decided.

Put in a stop at just over 16, almost a dollar less than it's trading after hours. I figure with this I'm still up 60% in 2 years plus a 30% annual dividend. Still my best performer, I bought it mainly for the dividend anyways, so the fact that it went up at all is a huge plus. If I get stopped out no biggie, I'm not going to be greedy.

Money management is the most difficult part of investing for me.

So if anyone sees a problem with that order, speak now or forever hold your peace.

Thanks to those who have posted so far.

[kregener]

I would sell the stuff and never look back.

If you don't, you will end up taking a bath on it.

Bank.

[Twisted Titan]

Why did this guy hammer the stock???

Was he short prior to it???

[LuckyStrike]

Why did this guy hammer the stock???

Was he short prior to it???


I always wonder about stuff like that, his points are mostly valid but you never know if they are on someones payroll. I hadn't heard of him until today.