It's clear why Alteryx fell yesterday.

I can not make heads or tails of this roller coaster. Trying to understand this latest dip as well. Ugh - it plunged cause I went and topped up yesterday when it was down 3-4% thinking I was getting a good entry opportunity.
Ant

Maybe I’m a cynic but I believe I know why the shares took that drop yesterday. It seems crystal clear to me. They priced the shares yesterday. Here’s a quote from the announcement. The following was probably negotiated on Monday, the 14th, the day before:

The initial conversion price represents a premium of approximately 42.5% to the $31.11 per share closing price of Alteryx Class A common stock on The New York Stock Exchange on May 15, 2018.

So Alteryx obviously got ripped off by the big banks and brokerage houses. On the 14th they negotiated the conversion price would be 42.5% over the closing price on the next day (the 15th). This is a small company and I’m sure it wasn’t hard for the big banks and brokerages to push the price down three dollars for a day so they’d get a lower conversion price. A conversion price that is actually lower by $4.27 [$3.00 times 1.425], so it was well worth their while to do it.

Now Alteryx’s stock price will “inexplicably” rise over the next few days as the big guys have no further interest in keeping it down. In fact the more it rises the more their convertibles are worth.

As I said, just cynicism on my part, put I’d be willing to give about four-to-one odds that that’s the correct explanation.

Best,

Saul

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I wonder if it is within the spirit, rather than the letter of the law, not to tell the owners of the company about a significant financial event due to take place within the week of results. It could be announced in the most general terms if any commercial secrecy was required, eg 'Your company judges this to be an attractive time… etc. … '.

Up almost 4% today early on…seems that Saul may very well be correct…or is this board followed closely enough that Saul’s post was a self-fulfilling prophecy?

This is a small company and I’m sure it wasn’t hard for the big banks and brokerages to push the price down three dollars for a day so they’d get a lower conversion price… Now Alteryx’s stock price will “inexplicably” rise over the next few days as the big guys have no further interest in keeping it down. In fact the more it rises the more their convertibles are worth.

Well here we are, 15 minutes after the open, and AYX is back up 4.25% already. Looks like I was correct in my assessment of what was going on.

Saul

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Stocks always fall on dilutive convertible offerings. Nothing new here. Why that exact amount I have no idea of course.

So Alteryx obviously got ripped off by the big banks and brokerage houses…In fact the more it rises the more their convertibles are worth.

So is it the banks or the brokers? Why not just name the underwriters on the deal?

The underwriters don’t own the converts except for a brief second, they have been sold to the bondholders. That’s what underwriting means.

Secondly, the reason new offerings like this one and almost all IPOs rise in the following day or two is because of the ‘greenshoe’ option, where the underwriters agree to support the deal after pricing.

That is also mentioned in the Press Release you quoted:
Alteryx also granted the initial purchasers of the notes a 30-day over-allotment option to purchase up to an additional $30.0 million aggregate principal amount of notes

The extra $30m of buying supports the price in the aftermarket.

No need for foolish conspiracy theories if you don’t understand how the underwriting process works - you can just ask people that do, similar to how you ask the tech people here how cloud virtualization works. Nobody expects you to be an expert on everything.

best,

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Stocks always fall on dilutive convertible offerings.

What is the general timing of when these offerings become public? Do these offerings provide good buy/sell timing opportunities? Or are the real-world results too unpredictable?

So AYX is a done deal for 44 dollars a share.

Even if it is a slow grower and takes a year to get there, this is low risk money and 40 percent isn’t anything to sneeze at.

Cheers
Qazulight

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29 Reccomendations for setting up a straw man argument and then calling a well reasoned argument ‘foolish’? Really?

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I would like to believe this…How high is your conviction that this can happen? I like the AYX story but like with most tech stocks, don’t understand a thing about it. I’d like to add but wondering if I should wait for it to get down to the mid-to-high 20’s.

Thanks for any light you or anyone can shed on this.

jackie

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In early 2016 I wanted to invest in NVDA. The stock was trading about $32-33. I wanted a good entry point, and I looked at the chart and thought the stock was due to drop to $30 sometime in the next month so I put in a buy limit order at $30 per share. That order never got triggered, and I couldn’t bring myself to invest in it until later when it was about $120 a share. Why wait for a 10% decline that may never happen? Determine whether you believe in the long-term potential of the company or not, and INVEST, don’t trade.

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Another option is to buy half of the position you want to establish now, and give it some time to roll the dice and see if the price drops, upon which you buy the other half. I personally wouldn’t wait for the drop either, but if you feel strongly, this might be a good compromise…

so what do you think of AYX for the ‘long term’?

it is highly valued right now and the market is expecting more growth.

tj

it is highly valued right now and the market is expecting more growth.
true of all Saul type stocks

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In the past few years I took advantage of pull backs to buy more and those buys gave me excellent returns but I could not be confident enough to put more than the little bit I put each time. So the impact on my portfolio albeit definitive is not drastic. I have been pretty happy with my portfolio net increases until I read here about yearly growth of 30 or 40% per annum in these past years using concentrated portfolios.

It is still hard to feel more confident about certain situation to place more than my minimum quantum each time.

For example I bought a chunk of SHOP back in 2016 at the ground level and added a few times on pull backs most notably after the Citron report. But I only added my minimum every time. My thinking each time was that SHOP was already highly valued and I did not want to risk more. I don’t have much idea how long their gangbuster growth can last. Obviously not for ever. If it is a good business and if growth transitions can be smoothed out, one could hold for a very long time and see continued stock appreciation.
I would like to get a few more at the ground level and be able discriminate opportunities that would be worthwhile to invest more in- in order word to concentrate.

I find it difficult to chase growth. Large growth happens for a given business at various periods and looking at a longer term, it is difficult to know when growth is spurred and when it slows. Obviously when you see growth like SHOP you hope in and you hope it will continue. When the growth slows you switch to another high growth of the period. It is like weaving through traffic. But on the end do you get much faster home than if you keep to your lane?

I have started to weigh in AYX and TLND, and PSTG. I like OKTA too.

I intend to keep ANET for a while. I added some at ~$240 and hope those positions will be rewarding.

tj

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In early 2016 I wanted to invest in NVDA… trading about $32-33. I wanted a good entry point… so I put in a buy limit order at $30 per share. That order never got triggered, and I couldn’t bring myself to invest in it until later when it was about $120 a share. Why wait for a 10% decline that may never happen? Determine whether you believe in the long-term potential of the company or not, and INVEST, don’t trade.

Yes. What’s scary is that Jim Cramer just made an even worse buy-point recommendation for NVDA: https://www.thestreet.com/technology/jim-cramer-says-you-sho…

Jim Cramer said: “we want it to come down now … so we can return to our larger size. [But] it’s got to go lower than $244.” This is with the stock at $248.

So 1.6%, really? Jeez.

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I would like to believe this…How high is your conviction that this can happen? I like the AYX story but like with most tech stocks, don’t understand a thing about it. I’d like to add but wondering if I should wait for it to get down to the mid-to-high 20’s.

Thanks for any light you or anyone can shed on this.

jackie,

My conviction on the sector is very high. AYX? High. My belief in my analysis? Low.

The machinations of the finance guys are difficult to follow, more difficult to front run.

Cheers
Qazulight

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