Monday moves....
On Monday I'm buying into YRCW for a couple of weeks. Here is why: YRCW is a trucking company that has an enterprise value of 1.27 billion dollars. In the past 2 years they have been on the verge of bankruptcy and the market cap on this company has fallen to just over 100 million. There are only 10 million shares outstanding on this company and it is currently trading at $12.50 a share because of the extremely low market cap. However, if the market cap equaled the enterprise value of 1.27 billion, this stock should be trading at $125 a share, 10 times it's current value. On Friday the 13th last week, the CEO of this company announced that they have reached an agreement with the union that they are contracted with on a plan that will get this company back out of debt over the next 4-5 years. There was unusual high volume on this news and the the stock price rose 24%. I'm buying in on Monday because I look for this deal to be signed on paper in the next couple of weeks which will really make to stock jump. I'm not saying this company will be trading at it's full value of $125 a share anytime soon, but I am predicting that when this deal is signed, the company will be trading at over $30 a share because the market value will rocket up as investors get back on board. I fully plan on selling the stock after this jump. Upside here is an investor could double their money in a short time. The downside is if this deal doesn't get done, the stock could slip back down to where it was before the news came out, $10 a share, representing a 20% loss. Personally, I'm willing to risk a 20% loss for a 100% gain.
On Monday I'm buying into YRCW for a couple of weeks. Here is why: YRCW is a trucking company that has an enterprise value of 1.27 billion dollars. In the past 2 years they have been on the verge of bankruptcy and the market cap on this company has fallen to just over 100 million. There are only 10 million shares outstanding on this company and it is currently trading at $12.50 a share because of the extremely low market cap. However, if the market cap equaled the enterprise value of 1.27 billion, this stock should be trading at $125 a share, 10 times it's current value. On Friday the 13th last week, the CEO of this company announced that they have reached an agreement with the union that they are contracted with on a plan that will get this company back out of debt over the next 4-5 years. There was unusual high volume on this news and the the stock price rose 24%. I'm buying in on Monday because I look for this deal to be signed on paper in the next couple of weeks which will really make to stock jump. I'm not saying this company will be trading at it's full value of $125 a share anytime soon, but I am predicting that when this deal is signed, the company will be trading at over $30 a share because the market value will rocket up as investors get back on board. I fully plan on selling the stock after this jump. Upside here is an investor could double their money in a short time. The downside is if this deal doesn't get done, the stock could slip back down to where it was before the news came out, $10 a share, representing a 20% loss. Personally, I'm willing to risk a 20% loss for a 100% gain.