Guys short STO is now a VERY crowded trade - and has been...

Guys short STO is now a VERY crowded trade - and has been lucrative for those who've been riding it.

But crowded trades still have only one exit door (buying back on market) - and if something unexpected pops like a significant asset sale to de-risk the balance sheet, strategic investor, etc --> could see the stock bounce very hard indeed & an ongoing major short squeeze.

Everyone crowding the Short trade, and while it looks like a one-way ticket - it is still a company with significant assets of value (they just can't expect to get top prices in sell off in this volatile and subdued oil/gas price backdrop). To be frank - that is what we have to cop for management stupidity/denial in taking on such significant unhedged USD borrowings to fund Gladstone & not pulling CR ticket earlier when the commodity markets crapped themself. That was their queue - however painful it seemed then to do so at $7-9, look where denial has gotten us!

Anyway, for my two bob worth - I am steadily topping up sub $5, as even if a CR is pulled, it will be by way of rights issue & at this market cap very good value (for the substantial assets Santos holds). Of course could go lower yet, and indeed I suspect shorters are pushing hard to try and trigger management to panic & pull the trigger this weekend if they can. I don't believe they will, but of course as little fry one never knows.

For anyone who does top up at these levels - need to puchase bit for the day, then turn off the screen/market manipulators "noise" & do something else. Also need to not sweat any paper losses while this plays out. It will reverse, and significantly at some point, just a question of when & how this very crowded trade begins to unwind.

PS Short Sellers & bots aren't my favourites either - ASX is riddled with this market manipulation these days. The little guy can't stop it, but can take advantage of the opportunities it creates...