Andrew Left is the founder of Citron Research and is one of Wall Street’s most prominent short-sellers.
At times, Andrew also goes long. Jumia Technologies AG operates an e-commerce platform in Africa. The company's platform consists of a marketplace, which connects sellers with consumers logistics service that enables the shipment and delivery of packages from sellers to consumers and payment service. Although he didn't say he was long Jumia, he did say it was going to $100. But if you know how this game is played he was long before making announcing that price target.
Sonos, Inc., together with its subsidiaries, designs, develops, manufactures, and sells multi-room audio products in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company provides wireless speakers, home theater speakers, components, and accessories.
Three months ago, Andrew made headlines when he said Sonos’s stock price was headed to $30, at the time would have represented a 100% return. Andrew said Sonos’s strength in the stay-at-home environment created by the coronavirus pandemic could make it a buyout candidate. Andrew even went as far as saying Sonos is the Apple of home audio. I thought he was did wrong, especially when Apple announced that it was launching its own audio gear and was removing from its online store the speakers and earphones from rival manufacturers including Bose, Logitech and Sonos.
Today, I noticed unusual options activity in Sonos. The Smart Money bought close to 13,000 April call options at the $20 strike price.
I didn't realize it, but after the market closed on Monday, Sonos was announcing earnings.
Consumers continue to spend on items to spruce up their homes as the pandemic wears on, and that helped Sonos Inc. top sales expectations for the September quarter.
The maker of smart speakers and other audio electronics for the home reported Wednesday that it saw revenue of $339.8 million for the September period, Sonos’ SONO, -0.29% fiscal fourth quarter. That was up from $294.2 million a year earlier and ahead of the $299 million that analysts surveyed by FactSet had been predicting.
The stock was up about 20% in after-hours trading.
Chief Executive Patrick Spence said that the sales growth was validation of the company’s strategy to both seek out new customers and focus on getting existing customers to add additional products to their homes.
Usually when you see unusual options activity right before earnings, 9 out of 10 times, the Smart Money is right. This was just another example of the Smart Money making money once again as price is now trading above $20 after hours.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.
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