In the last couple of days (actually since Monday) shares of RAD came of the 2,26$ low to 2,38$ this morning (pre market).
It may not seem much but 12 cents gain on a 2,25$ stock is still a good 6% in a matter of days.
Now the funny part is the fact that shorts have increased during that time and it does indicate that even if 6% gain was recorded this week so far, many do not believe RAD is on it's way up.
Even the smallest bit of positive news could set RAD on fire creating at the same time kind of a short squeeze and could have this stock goes nut very rapidly as more than 150M shares are shorted and with actual day to day volume, that would be more than interesting to watch it goes up.
Now the negative side is that maybe the one who are shorting that stock are right and again the deal would be rejected plummeting RAD to 1,50$ range.
As usual, risk / reward must be high in the case of a trade deal and in regard of RAD the risk ration is definitely high as the reward could also be.
Time to balance decisions against risk but so far i would think what's coming is positive for one main reason: IF negative was in the cards, RAD and WBA would have the obligation to disclose it as it would be considered 'MATERIAL'.
I also think that we are a lot closer than we think toward getting that deal accepted, getting RAD a major debt paid off and welcoming the new Rite Aid company that would be a lot leaner and profitable.
If that deal was not to be closed, i would suggest a complete management change !!!
It may not seem much but 12 cents gain on a 2,25$ stock is still a good 6% in a matter of days.
Now the funny part is the fact that shorts have increased during that time and it does indicate that even if 6% gain was recorded this week so far, many do not believe RAD is on it's way up.
Even the smallest bit of positive news could set RAD on fire creating at the same time kind of a short squeeze and could have this stock goes nut very rapidly as more than 150M shares are shorted and with actual day to day volume, that would be more than interesting to watch it goes up.
Now the negative side is that maybe the one who are shorting that stock are right and again the deal would be rejected plummeting RAD to 1,50$ range.
As usual, risk / reward must be high in the case of a trade deal and in regard of RAD the risk ration is definitely high as the reward could also be.
Time to balance decisions against risk but so far i would think what's coming is positive for one main reason: IF negative was in the cards, RAD and WBA would have the obligation to disclose it as it would be considered 'MATERIAL'.
I also think that we are a lot closer than we think toward getting that deal accepted, getting RAD a major debt paid off and welcoming the new Rite Aid company that would be a lot leaner and profitable.
If that deal was not to be closed, i would suggest a complete management change !!!
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