Going below $5 doesn't actually mean anything. Jcpenny, another struggling company, has been below $4.00 for four months. It currently sits at $2.38. Is the company failing? Yes. That's obvious. But there isn't a stock price threshold that drastically changes anything unless it's basically zero.
I just don't get the stock countdown posts I see here. There's no point in even using your energy for something like that.
@3xzr Thank you.
@3fct In a previous thread somewhere on here (about the board member who was stepping down and disbanding his own hedge fund), I found a webpage that gave the breakdown of current institutional ownership of Sears stock. I think that besides Eddie's hedge funds (and Eddie himself), and the former board member's hedge fund, the only other ones with a remotely-significant amount of ownership was Vanguard's Total Stock Market fund (which intentionally holds some of everything, proportionate to its total value in the market) and its Extended Market sibling (which holds everything Total Stock Market does, except for the stocks that are also in the S&P 500).
I thought it was difficult for the individual investor to purchase penny stocks meaning those priced under $5 due to regulations from the 1990s when investors were taking advantage of people a la the movie Boiler Room. There is an entire list of things that must occur for an individual to purchase these stocks.
Even though everyone believes otherwise, mutual funds don't have these restrictions and can hold penny stocks. I would hope that any funds that I am a part of do not hold SHC but truthfully I don't know.
I've bought a bunch of jcp stock cheap. Their ceo has a clue what is going on. Entering into appliance sales etc. They are undervalued and brought down with the other bricks and mortars stores like sears who is failing. At least their ceo has a vision. At least their stores are clean and not full off mold like sears and kmart. Eddie just likes to paint over the mold and leaky roofs asbestos floors like it doesn't exist.
many mutual funds are required to dump shares under $5.00
Almost all brokerages prevent an individual investor from shorting a stock that's priced under $5.
You can see the description here:
https://www.investopedia.com/ask/answers/03/110703.asp
Also, just search for: can i short a stock under $5
tere is a ton of examples
It isn't the end all; be all of a company, no. It is in a way though, an overall reflection of the "health" of the company. As other said, when a company has a huge drop from being a triple digit stock to a single digit stock it is for sure not good sign. It also scares away potential investors wanting to put money into the company and current investors trying to dump the stock but can't because it's price is way too low and won't make their money back.
A $5 closing price looks bad pure & simple. I looked up the stock price from the day I starred working at Sears and the price today and ....
The difference is J c penny cares about their stores they look good when you walk in .they sell appliances they care that's were we shop they will survive.ex Sears employee .! Go Penny's I'm buying your stock
It' relevant because in 2009 SHLD was 168.00 and shows the deep steady decline of the company as a whole. The losses can never be made up.
"Price itself doesn't mean a thing. The continued rate of decline is notable."
Yeah. This the exact point I was trying to make. It just seems like people love to set their minds on a specific number even though the specifics don't matter. Months ago people thought the stock would implode at the $7-8 mark. Now it's the $5 mark it seems.
Every penny the stock loses is $1M less Eddie and his buddies are worth. They lost $24M today. $211M in the last month.
Price itself doesn't mean a thing. The continued rate of decline is notable.
If I remember right, when a stock below $5 certain institutional investors such as mutual funds, etc. will typically divest of the stock thereby putting more downward pressure on the price. It doesn't mean the end is near at all, but it does make the stock price more difficult to come back.