Swift stock is crashing, blames it on them losing drivers and driver shortage

Victor im impressed with the research.

 

Thats about 15,000 short of where it should be.

 

There doesn't appear to be a fundamental reason for the short interest last year. The 50-day moving average did cross below the 200-day moving average a little before that, and chartists (aka "technical analysts") seem to think there is something magical about that.

Because they are being lent the stocks they are selling -- and the "loan" is based on a dollar value, not a share count. When shares go up, their loan gets larger than the agreed amount so they have to buy some shares to cover -- bringing their loan amount back down to the agreed amount. In the short term, this can actually drive the price up if no one is selling and shorts are having to cover.

But in the long term, shorting is a valuable tool that makes our markets a little more efficient by tempering irrational exuberance and incentivising analysts to root out fraud.

 

I started at swift .25 cpm. Three years ago. 3-400 dollar paychecks and a fat $4300 loan that I'm still paying off for learning how to drive. A pay raise is seriously in need for swift to remain competitive, which today they're not. Along with the huge class action lawsuit drivers have pressed regarding swift skimming miles off pay I don't really see any incentive for them to actually improve as an employer

 

I wonder what the average length of employment is for swift drivers. When I pass them most drivers either don't look over or they have a sad look on there face. I have to say a few drivers that I run into at Costco seem to be happy but they are on a dedicated runs. Did swift buying Central have an effect on there stock price?

 

Double Yellow said:

Actually, there is--most likely--a fundamental reason for short interest back October. Keep in mind, short interest more than tripled from about 8 million to over 27 million shares short. Huge.

SWFT announced the purchase of CRS (Central Refrigerated Service) in August 2013, fifth largest refrigerated truckload carrier. The third quarter ended in September 2013. So SWFT would have been preparing the investment community what to expect for the 8-K (quarterly report) for July-August-September and ongoing guidance what it was going to take to swallow CRS.

Haven't look any deeper, but CRS is cited right up there with HOS and shortage of drivers, unseated trucks. A 'fundamental' reason for a stock (or the market) to drop or rise, is a real, structural change, improved sales, better economy, sagging sales, droopy economy.

Purchase of CRS is fundamental with a boat load of challenges ahead even now, a year later.

And it's 'normal' for these acquisitions to be messy.

 

In the CRS purchase SWFT added >10% EBITDA & >13% revenue for <8% of their market cap. Not a fantastic deal, but far from over payment...


Consider the short interest in heartland express:

12/13/13 2874561
11/29/13 2614511
11/15/13 2967872
11/11/13 Gordon Acquisition
10/31/13 2907351
10/15/13 2728537
09/30/13 2654845
09/13/13 2716853
08/30/13 2409309
08/15/13 2456849


Heartland paid $300 million for $433 million in revenue & $60 million in EBITDA (vs $225 million for $500 million revenue & $50 million EBITDA). Granted Heartland didn't buy Gordon from Heartland's largest shareholder, but such a transaction is guaranteed to raise eyebrows making fraud unlikely.


Still, even if you accept the merger as a fundamental factor, how do you reconcile the fact short interest spiked more than a week before the announcement:

12/13/13 26599604
11/29/13 26045889
11/15/13 26133010
11/06/13 CRS acquisition
10/31/13 27726972
10/15/13 7982325
09/30/13 8090384
09/13/13 7788562
08/30/13 7465509
08/15/13 6929914




That's a massive jump for insiders -- especially on a merger likely to raise its share of eyebrows...

 

I was setup for orientation with them in a week. Definitely reconsidering. I really want to go with a smaller company. Thanks for the info though!

 

I really want to go with a smaller company , SWIFT could be headed towards being a SMALLER COMPANY

 

I think this is true. Swift is serious about culling customers that pay too cheap.

But Swift'll still be mega.