Strategic alternatives still ongoing with meaningful upside over the next 12 months and management sells the remaining division
A company I have covered closely in Grit Alpha reported earnings yesterday.
The stock traded down 7% on a weaker than expected earnings report.
The earnings miss was from a delay in orders that will be pushed back into Q2, with management reaffirming that Q2 will be substantially stronger than Q1.
It appears as if short-term traders have sold out of the equity hoping for a quick pop.
Even better, the management team said strategic alternatives were still ongoing. My best guess is the company is sold for $2.20-2.50 per share in the next 12-18 months.
The stock remains one of my largest positions and the recent selloff allows fundamental investors with a long-term horizon to accumulate additional shares at an even more attractive price.
With a stock price of $1.62 per share at the close, I am underwriting a target upside of 35-50%.
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