Posts Tagged ‘short positions’

Why Amedisys (AMED) will hit $85

Here’s PSW member Tuscadog’s detailed analysis of the company Amedisys (AMED). Tuscadog feels this is one of the few solid opportunities in the stock market, and he suggests a massive short squeeze may be coming due to AMED’s 53% short interest. – Ilene

Amedisys, Inc. provides home health and hospice services to the chronic, co-morbid, and aging American population. Its home health services include skilled nursing and home health aide services; physical, occupational, and speech therapy; and medically oriented social work to eligible individuals who require ongoing care. The company also offers clinically focused programs for chronic conditions and various diseases,… (Yahoo financial, more here.>>)

Why Amedisys (AMED) will hit $85

Courtesy of Tuscadog, member at PSW

Doctor standing outdoors with elderly patient

Feb 23rd may be ‘Judgment Day’ for the AMED short interest.

This is a long posting based on a lot of research and high level interviews I’ve conducted. I’m a private (long term) investor in Amed and I don’t appreciate the way Amed has been ‘jerked around’ by the hedge funds with false rumors and shorting, hence my willingness to share my analysis with small investors. These are my opinions based on my own extensive research, so invest at your own risk. For background on Amed pay particular attention to the 7 articles by Daryl Davis in the ‘Financial Blogs’ section of the Yahoo Finance page for Amed.


Amed will likely release 2009 EPS on Feb 23rd of around $4.90 to $5 and, more importantly, it will give guidance for 2010 based on the status quo on Medicare billing rates for 2010 (i.e. as already issued for 2010 by The Centers for Medicare & Medicaid Services, CMS). Based on the company’s growth rates and CMS’s announced approved rate increase for 2010 (which translates into a 1.8% net increase for 2010 after two flat pricing years) Amed will likely provide 2010 guidance in the $5.60 to $5.70 range.  I believe actual results outcome will likely be higher, in the $5.70 to $5.90 range.

The 15 analysts who cover AMED are likely waiting for Amed’s guidance update and to see if there are any Health-Bill developments. The Suntrust  upgrade Monday to a $70 target is using a pessimistic assumption of a revision to a retroactive 2.5% Medicare billing rate reduction for 2010. Currently, analysts eps forecasts for 2010 include varying degrees of…
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Hedge Fund Short Positions: High Operating Leverage the Common Theme

Hedge Fund Short Positions: High Operating Leverage the Common Theme

Courtesy of Market Folly

Upon reading various hedge fund investor letters and conversing with colleagues in the industry, one thing has become quite clear: hedge funds got their asses kicked on the short side of the portfolio in 2009. This is by no means a shocking revelation given that the stock market itself has risen over 70% from the lows back in March 2009. After all, a rising tide seems to lift all boats. While the negative performance of short positions over the past year is a common trend, we want to focus on a theme found in many of their portfolios.

Here’s the common link: many hedge funds have shorted businesses with high operating leverage. Amidst the crisis of the past two years, operating and financial leverage became quite a detriment to various companies. Hedge funds quickly recognized this and shorted shares of companies who would struggle with this burden in an uncertain economic climate. At the time, it was a poignant move. However, markets are often driven by perception (versus reality).

What are we talking about here?

We’re simply pointing out that the high operating leverage that was once seen as a detriment to the companies that hedge funds were/are shorting can now be construed as an attribute. According to the market, the economy is recovering and things are slowly but surely getting better. (More appropriately, the markets have been the beneficiary of massive capital inflows). Regardless, this market rebound re-instills confidence and shifts investor sentiment. And, most importantly, it reverses risk tolerance.

The very companies investors avoided like the plague during the crisis are now catching a bid because investors’ risk tolerance has returned. Many hedge funds missed this swing in perception and bore the brunt of the blow. It doesn’t matter right now if the company could potentially have problems due to their operating leverage. Right now, all that matters is that risk tolerance has returned and risk is ‘in’. This goes back to the age old market debate of perception versus reality.

We can’t tell you how many times we’ve seen hedge funds comment on the ‘mistakes’ they made in 2009. Almost all of their mistakes are on the short side of the portfolio. And while they don’t name specific stocks,

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seen at your local short-biased hedge fund’s trading desk

seen at your local short-biased hedge fund’s trading desk

Courtesy of The Reformed Broker, Joshua M Brown


Cheer up, It can’t go up forever guys. It never does.


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Important Point

Tim Knight’s take on yesterday’s trading and his bigger picture view:

Important Point

I genuinely try to avoid talking about "crucial junctures" any more frequently than I must, but we’re at one now. Well, perhaps crucial is too strong a word, but I think tomorrow is a very important day for the short-term direction of the market. There’s a big retail report coming out before the open, and a number of big firms (including Intel, after hours) are reporting earnings. So the Q2 earnings season will begin in earnest.

Today [yesterday] wasn’t at all a good day for the bears. With the Dow up 185 points (having been down early in the trading day), and the $BKX bank index up over 6.5%, a lot of my short positions took it on the chin. My one really big position, my OIH short, I was able to exit at a decent profit, and I got into a couple of TBT longs that were good for me. But otherwise the day pretty much stunk.

Glancing at the FAZ and SKF below, you can see how July’s nice progression of gains got nuked in one session, and in both cases we’re sitting right on support. I got stopped out of both of these immediately at the opening bell (thank goodness).


The simple fact is that we haven’t had as big an upward move on the /ES since May. If tomorrow is another strong day, it’s probably back to the horrible Waiting Game, as both sides continue to wrangle each other. I had thought we had just about gotten the upper hand on this market, but today puts that scenario at-risk.



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Phil's Favorites

1984 Is Not The Future

Courtesy of The Automatic Earth.

Jacobello Alberegno The Beast of the Apocalypse 1360-90

The Guardian ran an article yesterday by one of its editors, David Shariatmadari, that both proves and disproves its own theme at the same time: “An Information Apocalypse Is Coming”. Now, I don’t fancy the term apocalypse in a setting like this, it feels too much like going for a cheap thrill, but since he used it, why not.

My first reaction to the headline, and the article, is: what do you mean it’s ‘coming’? Don’t you think we have such an apocalypse already, that we’re living it, we’re smack in the middle of such a thing? If you do...

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Zero Hedge

Mapping The Countries With The Most Billionaires

Courtesy of ZeroHedge. View original post here.

There are roughly 36 million millionaires in the world.

That means if you meet someone from the global population at random, there’s a 1 in 200 chance that they could be a millionaire – this makes for surprisingly good odds.

However, as VisualCapitalist's Jeff Desjardins notes, the billionaire on the other hand is a much rarer breed. According to Forbes, there are just over 2,000 billionaires in existence, making up just 0.00003% of the global population.

Where do these people ...

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Digital Currencies

Bitcoin: Bubble Or Hyperdeflation?

Courtesy of ZeroHedge. View original post here.

Bitcoin flew too close to the sun. Now the eyes of the world are upon the crypto market, with all the consequences that follow...

“30th anniversary of Black Monday, when markets dropped 23% in a day. In crypto we just call that Monday."

- Alexander Tapscott

But, as Incrementum's Demelza Hays and Mark J. Valek show in their latest magnificent Crypto Research report, it all happened as it always has.

Bitcoin reached an all-time high and then predictably it fell again. All c...

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Chart School

Bitcoin Update, demand is present

Courtesy of Read the Ticker.

When a Wyckoff trader looks at a stock chart of price and volume one looks for foot prints of material demand and supply. The current bitcoin chart shows very significant demand prints.

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Sure fundamentals do matter, and so does market timing (entry, stops and exit), here at we believe a combination of Gann Angles, Cycles...

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Connor Browne - FAANG Stocks Dominance

By VW Staff. Originally published at ValueWalk.

They are known as the FAANGs but Facebook, Amazon, Apple, Netflix and Google/Alphabet should also be dubbed the great disruptors. They have created new businesses and destroyed old ones, changing the way we conduct our personal and business lives in the process.

]]> Get Our Activist Investing Case Study!

Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet, or print it out to read anywhere! Sign up below!

Check out our H2 hedge fund letters here.


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Insider Scoop

BofA: Lyft, Magna Could Be The First Of Many Autonomous Vehicle Partnerships

Courtesy of Benzinga.

Related MGA Benzinga Pro's 5 Stocks To Watch Today Earnings Scheduled For February 22, 2018 ... more from Insider


How your brain is wired to just say 'yes' to opioids

Reminder: Pharmboy and Ilene are available to chat with Members, comments are found below each post.


How your brain is wired to just say ‘yes’ to opioids

A Philadelphia man, who struggles with opioid addiction, in 2017. AP Photo/Matt Rourke

Courtesy of Paul R. Sanberg, University of South Florida and Samantha Portis, University of South Florida


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Members' Corner

Fatal Flaws of our Enlightenment?


David Brin is an astrophysicist, technology consultant, and best-selling author who speaks, writes, and advises on many topics including national defense, creativity, and space exploration. He’s also one of the “World’s Best Futurists.” Find David’s books and latest thoughts on various matters at his website and blog. In ...

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Mapping The Market

The tricks propagandists use to beat science

Via Jean-Luc

How propagandist beat science – they did it for the tobacco industry and now it's in favor of the energy companies:

The tricks propagandists use to beat science

The original tobacco strategy involved several lines of attack. One of these was to fund research that supported the industry and then publish only the results that fit the required narrative. “For instance, in 1954 the TIRC distributed a pamphlet entitled ‘A Scientific Perspective on the Cigarette Controversy’ to nearly 200,000 doctors, journalists, and policy-makers, in which they emphasized favorable research and questioned results supporting the contrary view,” say Weatherall and co, who call this approach biased production.

A second approach promoted independent research that happened to support ...

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Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.


This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...

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NewsWare: Watch Today's Webinar!


We have a great guest at today's webinar!

Bill Olsen from NewsWare will be giving us a fun and lively demonstration of the advantages that real-time news provides. NewsWare is a market intelligence tool for news. In today's data driven markets, it is truly beneficial to have a tool that delivers access to the professional sources where you can obtain the facts in real time.

Join our webinar, free, it's open to all. 

Just click here at 1 pm est and join in!

[For more information on NewsWare, click here. For a list of prices: NewsWar...

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Kimble Charting Solutions

Brazil; Waterfall in prices starting? Impact U.S.?

Courtesy of Chris Kimble.

Below looks at the Brazil ETF (EWZ) over the last decade. The rally over the past year has it facing a critical level, from a Power of the Pattern perspective.


EWZ is facing dual resistance at (1), while in a 9-year down trend of lower highs and lower lows. The counter trend rally over the past 17-months has it testing key falling resistance. Did the counter trend reflation rally just end at dual resistance???

If EWZ b...

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All About Trends

Mid-Day Update

Reminder: Harlan is available to chat with Members, comments are found below each post.

Click here for the full report.

To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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