Life Partner Holdings (LPHI) is a stock I am undecided on what to do. I think the drama is overblown after yesterday's Citron Research report, but I don't like drama in a larger sense of any nature.
I sold out half the position yesterday in case it took another leg down... the stock has jumped up a bit after a "we're ok" letter from the CEO last night.
Dear Shareholder:
Earlier today, a negative report was issued about Life Partners which contained inaccurate assumptions, misinformation and erroneous facts about our company. As a result of the information in this report, our stock experienced unusual volatility and trading volume.
We are confident that our business growth will remain strong throughout the remainder of this fiscal year and beyond. We vehemently disagree with the conclusions reached by the author of the report and believe strongly that our business model will continue to demonstrate the sustainable growth we have exhibited over the last 18 years.
We urge all shareholders to focus on our exceptionally strong business fundamentals and welcome the opportunity to address any issues or legitimate concerns our shareholders may have.
Sincerely,
Brian Pardo Chairman
Personally I would of liked to have seen Pardo address the one issue in the Citron Research that causes one to give pause - his background situation.
The stock has rallied to just under $29.50 which is its 200 day moving average. (note: the chart below shows a far higher 200 day than what I use) I am going to take the other half off (1.2% of portfolio) in the $29.40s, suffer the 22% loss on this portion and monitor from afar. I'll file this under the heading of "stuff happens". If the stock cannot rally from here, it is technically a good short... but this trades very few shares a day and can move substantially in either direction on little news.
I don't have a beef with the company and it could skyrocket 30% from here... in fact I could see that happening during its next earnings report. But the market is hard enough without getting attacks from the internets. The original thesis here is (a) great chart and (b) business that should be immune to business cycle; so we've lost half the thesis at this time.
No position
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