Volumes are very low millimouse and in a thinly traded stock that is a very important issue.
There have been a couple of long lines released (sold) to market over the last week at 61c absorbed by an institutional buyer who soaked up 125,000 shares.
Once the selling filled the buy order, only small trades typical of retail investors have occurred over the last 2 days. With the large number of sellers outnumbering few buyers, anyone who wants out needs to sell at whatever is bid even if it is pittance. ATM the bids are very few and very lowly priced so the SP plunges very quickly and deeply.
CUP has always traded like this, so there is no real surprise. There are many reasons for sellers to exit, some are financial, some are liquidity some are to pursue other stocks and some are because there is a suspicion of bad news to come.
I would not read too much into the current price weakness. However, that is not to say there may be bad news coming. Having spoken to the new management and reviewed their renewed approach to member firms, I am happy to hold large amounts of this stock. Today at 57c I was happy to take up some more. Management need time to redirect this ship so there may be a few gremlins left to clear out, but broadly this is a debt free profitable company well placed to bolt on smaller practices on a selective basis.
As a CPA/CA myself, the industry is rife for consolidation as a large number of existing senior practitioners / owners retire.
CUP Price at posting:
56.5¢ Sentiment: None Disclosure: Held
