Why CFP’s Stock Price Should Collapse, But Doesn’t
Wednesday, December 23rd, 2009Joe Eqcome submits:
On fundamentals alone, Cornerstone Progressive Return (CFP) appears vastly overvalued. In the face of this fundamental overvaluation, its major shareholder has been liquidating approximately half its position and has another 5 million shares of CFP to be sold or transferred for its holdings to be completely liquidated—if that is its intent. (See graph below.)
Potential Embedded Losses
Based on a reasonable set of assumptions—but not perfect information—it appears that the net cost basis per share of its major shareholder and its clients is $9.47 per share (see assumptions below).
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