Corkface maintained his large lead last week (he's up 50% in three weeks thanks to shorting the international dog bank, HBC), but our real news concerns Image Entertainment (DISK), that penny stock we bought at $1.25 in hopes of a take-out merger at $2.75. During the week, Corkface jumped into DISK at $1.41, and I added another 2,000 shares at $1.25.
As you can see by this E-Trade chart, DISK slipped all week, and the merger look doomed. Sure enough, Friday morning -- the day the merger was supposed to close -- DISK said the acquiring firm was in breach of the merger agreement. Yikes! A plunge under a buck! But as of this writing Saturday morning, DISK management was still in negotiations to extend the deadline.
DISK issued a press release early Saturday morning.
The merger is not dead. And remember, that's $2.75 a share that could be coming, in cash, for a $1.10 stock.
Play with us anytime. Leave a comment with your email. You have 10,000 Austin Carr Dollars to invest in listed stocks (they must have symbols). You don't even need to pick a stock. Just stay in cash and bet the market's going further down. Or, since you have all weekend to buy at Friday's $1.10 close, buy 9,000 shares of DISK -- spend your Austin Carr dollars on Austin's own pick. If I'm right, and this merger closes in April, you'll be leading the 2009 Austin Carr Stock Market Challenge. (Yes, there WILL BE a package of prizes, including having a character named after you.)
20 June 20 puts HBC 3,000
2000 shares MBRK 2,840
250 shares TSYS 2,185
4000 DISK 4,400
2000 OMEX 6,980
4000 DISK 4,400
13 shares of SPY 998
GIANT DISCLAIMER!!!! If you go risking real money on any of these stocks, lose hard-earned cash, and try to sue me, you'll have to tell the judge, "Yes, Your Honor, I took advice from the blog of a fictional stockbroker."