Disclosure: The author has a short position in one or more of the shares mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

Atkins... as night follows day: time to short

By Matt Earl, The dark Destroyer

11 November 2015 02:16

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Coming up to two years ago I sold short in Weir Group (WEIR) with a market cap of £2.4 billion at 2,094p. I quickly covered the short about a month or so later at around 2,300p. I closed in the midst of a sharp run up in Weir's price, driven by spurious bid speculation and a short squeeze; short interest at the time was 12%. The market then was also fairly unforgiving for shorts, still being juiced by QE, statements of "whatever it takes" and all that.

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Comments

zach01

11 November 2015, 04:00

Hi Matt, You put a lot of work into your short positions. Like you, I also found Weir, “weird”. Unlike you, my research consisted of reading on the morning of, 28th April 15, the company RNS, which in shorthand said, we are getting hammered, and its getting worse. When the market opened, I sold @1801p and closed later that day @1749p. To my astonishment a few weeks later, with no further RNS’s, it was @2050p. I was so tempted to short again, the company has large drops in orders and the share price rises 300p in weeks?. To my anger, a few months later, the shares hit a day low of 999p…..ouch!… Good luck with Atkin’s, taking a line through AMEC, with their recent profits warning, this should work for you.
wildrides

11 November 2015, 16:51

I know nothing about shorting as I only trade long but one thing that puzzles me is :- how do you know that the company has not won new work ahead from other new customers that makes up the shortfall from the customers you have mentioned in your piece ? I presume that you rely on all significant new work being declared in RNS statements ?
AK47

12 November 2015, 03:05

I follow Matt via twitter and his blog, and the data and analysis that he provides with his posts is second to none. The man is a legend. Fantastic analysis!
bargainvalue

30 December 2015, 04:39

I have the same question as “Wildriders”. The company’s fundamentals are great, what you can check in my latest article: http://bargainvalue.co.uk/ws-atkins-stock-analysis/
Due to this fact, I think, that even if some troubles will apear in the future, they will be only temporary and won’t have such a big impact on ATK performance in the long run.