Positive sentiment on Quindell quickly disappears
Jul 17, 2014 at 10:12 am in AIM by contrarianuk
Quindell’s shares rose strongly on Monday after a trading update reassured investors that a further cash call would not be necessary this year and showing a strong rise in revenues. After rising as high as 245p on this news, the shares are back at 194p after a series of negative articles about cash flow particularly in newspapers such as The Telegraph. Before the trading update the share price moved below 180p following the revelation that the Spanish company Gowex had admitted accounting irregularities after a damning report by Gotham City which also made allegations against Quindell earlier this year.
A series of broker reports have failed to diminish the slide back down. Canaccord Genuity reiterated their buy rating on Tuesday morning with a 362 p price target. Cenkos Securities Ltd also reiterated a buy rating and Daniel Stewart & Co put a £10 price target on the stock.
The following companies have short interest in Quindell. The question is who is Roble and why are they so confident increasing their short exposure despite Monday’s trading update?
Coatue Management, L.L.C: 0.92% 2014-07-10
Ennismore Fund Management Limited: 0.56% 2014-07-14
Roble S.L.: 5.03% 2014-07-14
TT International: 0.58% 2014-07-14
Quindell certainly looks too hot to handle right now, many investors appear to be listening more to Gotham City research rather than Rob Terry particularly when its comes to cash flow and recognition of revenues. The shares can be very lucrative if you get your timing right as shown by Monday’s 30% plus rise, but the volatility is exceptional on outright speculation and rumour. Its AIM and this is the friskier end of the exchange that’s for certain and you certainly have to have the stomach for the ride up and down on this roller coaster of a share. I’m watching with interest as its one hell of a story whatever happens over the coming months. Plenty of money to be made or lost for the traders.
Contrarian Investor UK
IMPORTANT: The posts I make are in no way meant as investment suggestions or recommendations to any visitors to the site. They are simply my views, personal reflections and analysis on the markets. Anyone who wishes to spread bet or buy stocks should rely on their own due diligence and common sense before placing any spread trade.