DALLAS, June 16, 2017 /PRNewswire/ -- eQuine Holdings, LLC., through its proprietary algorithm has identified the top five equities being manipulated by abusive naked short sellers and the illegal use of deep in the money calls to reset Reg SHO buy-in requirements.
Dynegy (DYN) – In a release dated April 27, 2017, eQuine identified Dynegy as a potential acquisition candidate and it was later disclosed by various media outlets that Vistra Energy (VST) was a likely suitor. Neither company has confirmed the rumors however the real-time short position since the announcement has increased on average of 400,000 shares per trading session, while the DIMC volume has increased by a 6.3X. This doesn't include the additional 6.8 million common shares that were sold short on May 19th and 22nd and the basket trades of 9.6 million shares shorted across all dates and strikes in the options markets.
The number of institutions owning shares exceeds the authorized by 16% and doesn't include any retail holders. The daily short position is derived from the inflated 116% owned and is getting closer to disaster for the illegal short sellers as the shares to cover are phantom shares and simply don't exist. eQuine's algorithm has detected Dynegy as the top manipulated equity by abusive naked short sellers.
Should Dynegy and Vistra fail to consummate a marriage we still see an upside delta of $11.50 a share for a target of $19.10 over the next 12-24 months.
Marathon Oil (MRO) – Shares of Marathon are trading near a multi-year low with the overall oil slide and the real-time short position has increased on average of 250,000 shares per trading session while the DIMC volume has rocketed 200% across all strikes and dates. We see an upside delta of $8.13 a share for a target of $20.65 over the next 12-24 months with a WTI recovery between $58.00 - $62.00 range over the same period.
Rite-Aid (RAD) – Shares of Rite-Aid are trading near their 2013 lows with a potential acquisition still being hammered out with Walgreens and Fred's. Since the original announcement several developments have occurred that have affected the share price of the merger and we believe that the merger will be consummated in the next few weeks.
The real-time short position has increased on average of 3 million shares per trading session since the beginning of 2017 and the DIMC volume has kept pace with some options now being written at $1.00 strike prices across all dates.
Additionally, the real-time short position across all strikes, equities and derivatives is close to exceeding the total number of shares authorized with no Reg SHO violation occurring. We see an upside delta of $3.75 a share for an acquisition price of $6.86 a share over the next 3-6 months. As a stand-alone we see a greater delta of $5.57 a share or $8.60 over the next 24-36 months.
The Mosaic Company (MOS) – Shares of Mosaic continue to be range bound along with its peer group in the phosphate and Potash industry. The company also recently reduced its dividend payout to conserve cash given the challenging phosphate market that has been slow to recover. MOS trades significantly below its peers Potash (POT) and Agrium (AGU) on a market cap and ROE basis and this gives a delta of $10.99 or a target price of $33.42 to trade in parity with its peer group.
The short volume in its shares have seen a 3X compared to its peer group and have averaged 400,000 shares per day and continually exceeds the beneficial shares traded daily minus HFT and UHFT. DIMC continue to exceed the normal daily volume across all strikes and dates by a 3X. We see MOS trading in parity with its peers over the next 12 months and see it exceeding that parity on a Potash recovery.
Lending Club (LC) – Lending Club continues to be range bound below $6.00 as it works through C-Suite changes and the former founder being ousted due to alleged egregious activities with some of the loan portfolios. The real-time short position has become somewhat disturbing as it has now exceeded the total number of shares outstanding including all options (all available strikes and dates) basket trades and derivatives. It continues to log 450,000 shares plus daily to the short side exceeding the beneficial trading volume, minus HFT and UHFT by 50% or greater daily. Market makers and institutional traders have started filing short exemptions with FINRA daily to avoid Reg SHO buy-in requirements.
The DIMC volume is significantly less, but options are still being written below the $4.00 strikes. We see an upside delta of $7.18 for a target price of $12.68 over the next 12-24 months, and believe that any catalyst to the upside could carry a greater delta of between $7.19 and $12.09 a share on a forced buy in short squeeze.
About eQuine Holdings, LLC:
eQuine Holdings, LLC is a multi-family office (MFO) located at Southlake, Texas and is responsible for managing the day to day operations of various interests in private and public companies including: Capital Services, Private Equity, Due Diligence Consulting, Shareholder Activism & Leveraged Buy Out (LBO) Consulting. eQuine has deployed over $1.25 Billion in public and private companies.
The company deploys an algorithm that detects anomalies created by illegal abusive naked short selling and illegal use of deep in the money calls used to reset Reg SHO buy-in requirements, including other data points and trades directly against the illegal activities of abusive naked short sellers. eQuine reported record returns of 510.26% for fiscal year 2017 and has returns of 45.97% for the first six months of 2017.
Data used for the Daily Volume and Daily Reg SHO reporting requirements is obtained from FINRA & NASDAQ
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SOURCE eQuine Holdings, LLC