Hello again WSB,
Are you enjoying a weekend of recovery from an unfortunate (read: 100% normal) week of buying high and selling low? WELL, same here. Now that I'm awake from that Friday night bender (it's Sunday?), I wanted to take a few minutes to do a couple of things….
- TL;DR at the bottom, but I do hope you take a second to skim it
- Review some analyst predictions and price targets on CLNE
- Talk to you about CLNE short activity that has taken place over the last couple of days
- Update the room on the status of market conditions surrounding CLNE and just some sentiment
If you want to learn more about CLNE, I've got a short DD post in my history from last week that you can check out; it's an easy read. Or, recommended, you can search for one of the more in depth DD's done here; all great work.
Disclaimers: (1 no images because auto-mod kept screwing me last time. (2 I am not a financial advisor and this is not financial advice. (3) 1,000 shares at <$8.25 average dating back to first purchase in 2020. (4) Thank you mom for turning my computer on and transcribing my incoherent mumbling into these words.))
Let's start with a review of analyst price targets… CLNE closed Friday at $9.31
- 5 analysts have offered 12 month price targets on CLNE
- Low estimate is $11.00 (18.2% gain from Friday close)
- High estimate is $27.00 (190% gain from Friday close)
- Median estimate is $20.00 (114.8% gain from Friday close)
- Cramer came out in May and said he doesn't like the stock
"aNaLyStS aRe DuMb AnD Ur DuMb ToO" – I know and I know. "AnD aMaZoN iS GoNnA dIlUtE tHeM sHaReS bRuThUr!" What? Ok….. To quote Bill [from science videos shown in elementary school class rooms whose last names happens to be the same as a small cap stock ticker], consider the following…
- There's a legitimate case to be made for the stock having an extended-term floor of somewhere near $13.49, thanks to details of their partnership with little-known company called Amazon.
- As a part of the deal with Bezos Inc, which also supports 46 CLNE fueling stations, Amazon reserved the right to purchase up to 53 million shares on warrants at a strike price of $13.49.
- However, only a quarter of these are exercisable immediately. The rest are only vested after Jeff has made a certain amount of fuel purchases from CLNE. This drastically detracts from the cost of the deal, and the way CLNE runs those sales/revenues will most certainly be pumped back into additional infrastructure investment (see their earnings which are always dead on estimates and near $0.00 EPS)
- In short, Amazon has a huge stake pending in CLNE, but only after significant additional expenditure and investment. AKA….. PARTNERSHIP
Moving on to the topic of… shorts and activity…
I'm not as fluent on this subject as I am some others like technical mumbo jumbo and early 2000's pop-punk/emo music (IT'S NOT A PHASE MOM), but I think you'll appreciate the information here and at least be able to connect the dots as to how this relates to the other popular stonk plays on this sub.
- Over the last 10 trading days, before Thursday/Friday, daily shares sold short sits at about 10% of volume.
- On Thursday this rose to 26.8% on the day – on Friday again to 32% on the day
- So what, 26 or 32% isn't huge, right? Sort of.
- The significance from the rise in ratio of shares sold short vs volume is the concurrent spike in volume…. In terms of absolute numbers, shares sold short went from about 500,000 per day to 8.10 million on Thursday and 10.64 million on Friday.
- The major short players on this stock have been Citadel and Blackstone.
- Spoiler alert…. According to fintel, short shares availability is only 8.6 million as of June 4th.
- With an average daily volume of around 5 million (again, before Thursday/Friday), how many days to cover….? You do the math.
And some final thoughts about market conditions around CLNE and the options landscape…
I'm not here to push any squeeze thesis, just providing information to help you develop your own conclusions about what I believe to be a great stock play (I've been in since 2020). There is short and long term potential here, in my opinion.
- The [now famous] June 18th $13 strike call OI now sits at 29,544, an increase of about 25% since my last update and representing 2.95 million shares of exercisable calls. This is about 60% of the average daily volume prior to the spike in volume on Thursday/Friday.
- A reddit user, who I won't name because I haven't asked them, who used to work in IR at CLNE indicated to me during chat/discussion this weekend that the leadership team is aware of the recent uptick in interest/sentiment and are excited that people are not only interested in the company, but also believe in the product.
- The DD content and general sentiment on here the last couple of days, and months honestly, has been positive. The environmental side of the story is great. Besides needing a decent business case and technicals, never before in history (my opinion) has it been more important to have a good story/mission to make people feel good about what your company is doing. Our society is more social than ever.
- 🐄💨🚀 🌙
Do I think this is a one-way ticket to [the planet] Uranus? No. Do I think this will make me an overnight millionaire? No, especially because my position is relatively small. But, I do think that there is a legitimate shot at some gains both short and long term here. The company has a product, sales, partnerships, a good story, and now the backing of an army of passionate people (read: apes) who, quite simply, like the stock.
Thanks and take care.
Jump To The Original Source