Knowing the news is one thing, but turning that news into actual money - profits - is another. Investors still have to make buy and sell decisions, and "buy low, sell high" more often than not... a task that's easier said than done. That being said, traders who own or are thinking about owning Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR), The Fresh Market Inc. (NASDAQ:TFM), and Hyperdynamics Corporation (NYSE:HDY) will want to consider the following ideas first.
As much as I hate to be the one to day I told you so about Green Mountain Coffee Roasters Inc., I told you so. Back on the 20th I said "the bears overshot with their extreme pessimism", referring to the drubbing GMCR had been through since September of last year; shares had fallen from $106 to a low near $17 as of July. Though we had seen a modest rise in the meantime, most of the market dismissed it as nothing more than listless drift, assuming Green Mountain was never going to pull itself out of the problems it was mired in.
Today, GMCR shares are up a solid 20% on - surprise - a raised forecast. As it turns out, things aren't as bad as they're supposed to be for the company. Green Mountain Coffee Roasters expects net sales to improve between 15% and 20%, at least for the coming year. But what do you do with it now (assuming you owned it)? I suggest locking in the gain today while you can. Though I remain bullish on GMCR in the bigger picture, that's a huge gap with today's strong open, and I suspect the bears are going to try and go back and at least fill most of it.
At the other end of the spectrum is The Fresh Market Inc... a stock that had been rallying since late 2011, but in the same way the pullback from Green Mountain Coffee Roasters slowly transitioned into a rally starting a few months ago, TFM started to transition from rally mode to meltdown mode in September. There was one last bullish hurrah last week, but today's 18% plunge clearly broke a rising support line that had been keeping this one aloft.
So now what? In the same sense that I think the bears are going to push back in the short-term with GMCR before letting the bigger bull trend reignite, I suspect the bulls are going to push back on TFM before the sellers start to pile on for round 2. So, if you're not interested in selling right now and booking a huge loss, you may find The Fresh Market shares priced a little higher later this week. But, don't tarry, or wait to get back in the black, because I've got a feeling the bigger-picture damage has already been done - the uptrend is broken. And, with a forward-looking P/E of 34.6, it's not like there's any value argument to be made.
Finally, the last five weeks have been nothing less than maddening for fans and followers of Hyperdynamics Corporation. The bulls got started in late October after the market started to digest a potential deal with Tullow, pushing HDY shares all the way up from $0.67 to a peak of $1.32 by November 7th... a multi-month high. But, a "buy the rumor, sell the news" mentality kicked in, and earlier today the stock hit a new multi-year low of $0.53 before bouncing back to the current price of $0.64.
What's it mean? Given the whole of the past five weeks, odds are good all this volatility from HDY has shaken off all the would-be sellers and also inspired all the buyers that were on the fence to get on board. Now, with the stock no longer in the middle of a tug of war, normal trading - and normal analysis - can resume. There's a huge chart-based clue with today's bar, though... a hammer shape. The open and close (so far) near the high of today's tall range, and the fact that today's range happened to hit new-low territory before the stock bounced back, may well indicate the transitional period is over, and that the sellers have all been worked off. Though still speculative, HDY could get several days' worth of bullish traction from this.