Greed, Fear, and Greater Fools

By: ispeculatornew
Date posted: 03.06.2008 (10:09 pm) | Write a Comment  (9 Comments)

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COIN – Converted Organics (Nasdaq) – (Closing Price – $16.59) 

I have referred to “greater fools” and the term “hope a dope” a couple of times and the company Converted Organics (COIN) is a perfect example of what I was talking about.

I came across Converted Organics on a day trading stock blog a few weeks ago and I have been following the stock out of curiosity. The stock price of Converted Organics has risen from around two dollars to the current price of $16.59 in the past half year. I am not sure what initially caused the stock price to surge but the stock price has continued to go up on sheer speculation.

Essentially people are buying the stock and hoping other fools will continue to buy the stock and send the share price up. The only thing Converted Organics has going for it is the company has an extremely low float (number of tradable shares). That is the major reason speculators have been able to manipulate the share price up.

However, there are a bunch of warrants outstanding that are quickly being converted to shares and increasing the float. This isn’t good news for the people gambling in this stock.

At some point greed is going to turn into fear and the stock price is going to crash. I did a quick check for the fundamentals of COIN and I found that the company doesn’t have any. The first quarterly report I came across on the company’s website was from Nov 13, 2007 and it showed the company has no revenue! It’s simply amazing that people have been buying this stock.

If you are a risk taker you could potentially score a huge gain shorting this stock. The risky part is that the idiots who have been buying this stock may continue to do so. However, this stock could also lose half its value or more in one day when panic selling sets in. It will be interesting to watch what happens.

Disclaimer: I have no position in COIN.

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9 Comments

  1. Comment by COINZMASTER — March 6, 2008 @ 10:52 pm

    IT IS MY LIFESTYLE CHOICE TO BE AND PROMOTE ORGANIC GARDENING AND FOOD/NUTRITION/HEALTH

    I AM A LANDSCAPER,GROW AN ORGANIC GARDEN AT MY HOUSE 😯 FEET BY 80 FEET!I HAVE MADE MY OWN TEAS AND COMPOST/ORGANIC FERTS.COIN IS THE BEST TYPE OF FERTS!HAVE AN ENTIRE ORGANIC ORCHARD AND MY TOMATO SEEDS ARE FROM ITALY DATING BACK PRE 1900.I GROW HEIRLOOM VAREITIES MOSTLY AND ONLY!I NOW ABOUT THE SOIL HEALTH AND REMEMBER I SAID “IT’S ALL ABOUT THE BACTERIA”POST WHICH WAS THEN LAUGHED AT!NOW YOU ALL UNDERSTAND SOME MORE THANX TO MY POSTS IF YOU CAN READ AND WATCH LOL!TEST MY KNOLEDGE AND HANDS ON EXPERIENCE.

    I ALSO RUN AN ORGANIC FARM AT MY HOUSE I HAVE CHICKENS,BANTAM’S,GEESE,PEACOCKS,GOATS,SHEEP,HORSES AMONGST OTHERS.I LOVE TO SAVE THE MANURE FROM CHICKENS AND LOVE THE EGGS!!TASTES WAY DIFFERENT!!AND YES MY ANIMALS ARE FREE RANGE NO PEN TILL NITETIME!!
    MUCH RESPECT AND PEACE ON A GREENER PLANET CAUSE OF OUR GREAT INVESTMENT NOT TRADE!!!!
    THANX 4 THE CREDIT WHERE CREDIT IS DUE!I AM AN ORGANIC EATER/GROWER/LANDSCAPER/PLANT LOVER/ORCHID GROWER/TROPICAL PLANTS IN NY LIKE BANANA’S,ELEPHANT EARS,CANNA LILIES,WATER PLANTS,PASSIONFLOWER VINES AMONG ALL SPECIMEN TREES,SHRUBS,EVERGREENS++++
    IT IS MY LIFESTYLE CHOICE TO BE AND PROMOTE ORGANIC GARDENING AND FOOD/NUTRITION/HEALTH

    IM RICH CAUSE I LOVE COINZ DONT HATE DO REAL DD ON FWD REV.#’S WALL STREET LIKES A.G.R ACCELERATING REVENUE GROWTH!!!!$$$$$COIN IS THE ORGANIC FUTURE CALLED SUSTAINABLE !!!

  2. Comment by admin — March 6, 2008 @ 11:15 pm

    First, why don’t you try typing with caps lock off. Second, why don’t you enlighten me on why a company that has no revenue should continue to go up when it has already increased eightfold in a half a year. Since you have done so called DD what are the forward rev estimates and what is your valuation based on those estimates. Here is an even more elementary question. Do you even know the difference between COIN and COINZ?

  3. Comment by COINZMASTER — March 6, 2008 @ 11:59 pm

    YES IM IN BOTH ALL YEAR AT$4 AND 1$ YOU MAD 4 WHAT REASON,MAYBE YOU MISS THE RUN UP BY BEING JADED

  4. Comment by Giovanni — March 7, 2008 @ 7:47 am

    I thought the same way you did until I drove out and saw one of their sites at Woodbridge. This is a company with DEP approved permits to run a waste management site in one of the toughest states in the country. Go to their web site and watch the Paulsen Presentation. All your questions will be answered. The company also has 22 Million in cash that is held in trust for the construction and operation of the first facility. You are looking at $110,000 per day in generated revenue at peak operation of 500 Tons a day. I rode this beast from 7 to 15.80’s and made the mistake of selling early. As far as shorting goes, good luck finding shares. Oh Gartman owns this Company and claims it is his largest position.

  5. Comment by Max — March 8, 2008 @ 11:31 pm

    There are a lot of blogs about COIN like this.These guys take a quick look at the earnings info and say “there’s nothing there!”.
    It’s always obvious that these guys haven’t spent five minutes looking into the company or it’s business plan.
    There may be very good reasons to short COIN.But so far none of these guys have provided them.Looks to me like they’re looking at the chart and in a weak market a pullback looks like an easy call.
    We’ll see retracements no doubt.This stock has been moving so fast it gets overextended.But the long term uptrend remains strong.
    And this guy will be one of the last to understand why.

  6. Comment by admin — March 9, 2008 @ 9:59 am

    Max:

    There really is “nothing there” as you quoted (apparently from someone else). The company has no revenue. You can easily click on the link in my original post or go to their website and find their quarterly reports yourself. In spite of having no revenue this company somehow has managed to increase eightfold in the past half year. If that isn’t a good reason to considering shorting this stock I don’t know what is. The only reason this stock has been going up is fools have been buying and simply hoping some other idiots will come along at buy at a higher price (pure hype and speculation). I would look out below when the hype and speculation fades.

  7. Comment by COINZMASTER — March 9, 2008 @ 1:20 pm

    #1 LOOK AT THE TINY MARKET CAP IT IS STILL UNDERVALUED BY FAR!!!!!THE STOCK IS CHEAPER THAN SAY NOEC BASED ON FWD EPS#’S AND MARKET CAP SO COINS SHARE PRICE IS NOT WHAT YOU SHOULD LOOK AT IT IS THE MARKET CAP!!!!!EST. I GET 4 CARBON CREDIT IS 10 MILLION+ ON 5 PLANTS!

    ALRIGHT YOU THOUGHT COIN HAD 2-3 SOURCES RIGHT?

    1. TIPPING FEES FROM FOOD WASTE

    2. SALES OF FERTS FROM WASTE

    3. MINI-COIN MACHINE SALES OF UNITS

    4. SALE OF LIQUIDS FROM COLLECTION OF MINI-COIN’S

    5. ROYALTIES FROM SALES OF MINI-COIN’S OVERSEAS/PLANTS THERE?

    6. CARBON CREDITS$$$$$$$$$$$$$$$$$$

    7. HOME COIN MACHINES???WHATS NEXT???EPS#’S TO BE HIGHER OF NEXT 5 YEARS FOR SURE.LOOK AT POT,TNH,AGU,MOS,ETC…WE COULD FLY FOR YEARS SON!ACCELERATING REVENUE GROWTH!!!!!!!!!!!!!!!

    SHORTS ANY QUESTIONS??????????????

    YOUR SO COOKED AND YOU MUST BE SCARED FOR MONDAY WITH OR WITHOUT NEWS!!!!!!!!!!!!!!!!!!!!

    HOTTEST STOCK OF 2008 FOR GOOD REASON$$$$$$$$$$

    PLZ COMMENT ALL LONGZ AND SHORTZ OK!

    ===================COINZMASTER=================

  8. Comment by COINZMASTER — March 11, 2008 @ 2:25 pm

    LMFAO

  9. Comment by Kevin — April 6, 2008 @ 8:54 am

    are you still lauging coinzmaster? i wish i had seen this article a month ago, i would have shorted it at 16, dropped to almost 50% in two weeks.

    you guys will be sorry. i’ve lost money in “hope” stocks before, but i think i’ve learned my lesson. it always comes back to fundamentals.

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