BIG DD ON Senseonics – Why it crashed on FDA approval via /r/wallstreetbets #stocks #wallstreetbets #investing

Except it didnt. At least, from the news it shouldn’t have.

Disclaimer:

I am not a certified financial advisor. The purpose of this thread is for educational purpose, to correct the myopic disorder majority of our autists have. None of my words, post, texts, twits should be taken as financial advice, nor should it constitute any form of financial advice. This is not a recommendation to buy or sell a stock. You are responsible for your own investment decisions. Do your due dilligence before you invest in any securities. u/Capitalismquirk will not be responsible for any financial losses or gains should you invest into any security upon reading this educational article.

The picture is coming in a full circle.

I went to dig out 2021 revenue for Senseonics, and guess what?! The sum of 3 quarters excluding Q4 is about 9.5m, and according to Tim unaudited Q4 is ~$4.0M. That puts us at an estimated 13.5M nett revenue for 2021. The outlook for 2022 of 14-18M means the company is expecting the similar revenue stream as a BASE CASE, with potential ~30% YoY growth to nett revenue for 2022 with the Eversense E3 approved and ready to be marketed and sold to diabetic patients in the US beginning Q2 2022.

src: https://finance.yahoo.com/quote/SENS/financials?p=SENS

This news is BULLISH AF.

https://preview.redd.it/pl4daxvj98h81.png?width=820&format=png&auto=webp&s=722e5b0a74f309c1b8e9a7d81ba2969019256994

SENSEONICS is a late stage clinical company, NO SHIT they are going to be having cash burn as they prepare for Eversense 360. This is all within expectations of a clinical trial running company. FDA News is bullish as fuck because IN Q2, Eversense 180 will be available to patients in US. This is also in line with what management has put out as their 2022 outlook: 14m – 18m nett revenue estimates.

The stock should be erupting right? So what went wrong?

Post-nut clarity:

Hedgies tanked the fucking stock at pre-market and sent it south upon market open. They also had paid shills come out to tell us how the management suck for publishing a 14-18m nett revenue estimate, with some dirty anchoring bias play, directing paperhanded investors to the ~180M CASH EQUIVALENT for FY2021. This anchorage bias of pitting 14-18m of revenue estimates next to the 180m cash equivalent makes it seem as though the company is going to expect a 90% drop in revenue for the whole of FY2022.

Which begs the question, why did they do so?

Here is where some gears began to click in my brain. Exactly three days ago, my brokerage firm sent me a notice to inform me of certain stock positions that have increased margin requirements. First came AMC, GME. Followed by dear Senseonics. The margin requirements for short positions were raised from 160% to 200%. This is indicative of utilization peaking, short interest climbing, cost to borrow increasing OR available shares to borrow are getting thinner by the day. a 40% increase is arguably not a lot. However, a 40% increase on a stock primed to erectl that is a whole different equation all together. We’ve lived through GME and AMC (though neither has squoze yet), we know what happens to margin accounts when prices go parabolic.

Here is a likely scenario why the price action happened the way it did:

Hedge funds that are short on Senseonics manipulated the price down and tanked the stock on purpose. This bearish sentiment is further bolstered by articles deploying anchoring bias to make the undiscerning investor think that the company is a goner. Paid shills on stocktwit, twitter and across reddit come together, regurgitate and amplify the anchoring bias to make it seem like the company is kicking themselves in their foot, purporting a supposed 90% LOSS in revenue for fiscal year 2022. Panic sellers scrambled to sell their shares in fear that the stock is “going to $0”.

  1. Revenue estimates are bullish AF and represent a 0% increase/decrease as a base case. With a potential of 33% YoY Growth in Bull case assuming we hit 18m in Revenue.
  2. Senseonics has plans to kick start their next Eversense clinical trial and are expecting to start in 2022. Expenses are expected because they are a late stage clinical company. Duh.
  3. (Eversense E3 CGM is actually one of the longest lasting (industry-leading) product in the glucose monitoring industry. Here is what it offers.

https://preview.redd.it/jlk4e2f2e8h81.png?width=752&format=png&auto=webp&s=de417e2ea8cff9b338384b742f19f2653cc7c22b

Panic sellers who sold into hedgies’ false narrative have no one but themselves to blame. The FDA news and 2022 Outlook is actually bullish AF, and the fundamentals of the company just got so much stronger from the news. The price action should be true once the hysteria settles and people start to think with post-nut clarity.

TDLR: Short hedge funds painted a gloom-and-doom picture, panic sellers bought into their narrative and sold. Since pre-market, they’ve only doubled down on their short positions. According to my brokerage notification on margin requirements for SENS, any parabolic movement for this stock will send shareholders through stratosphere; and you’ve guessed it, SHFs cannot allow that to happen because they’d be majestically fukt.

The news is bullish AF if you look past the anchoring bias they used to spun their doom and gloom narrative.

Increased margin requirements in Short positions w.e.f 10th Feb 18:00:00 CCT

Post-Script Disclaimer:

I am not a certified financial advisor. The purpose of this thread is for educational purpose, to correct the myopic disorder majority of our autists have. None of my words, post, texts, twits should be taken as financial advice, nor should it constitute any form of financial advice. This is not a recommendation to buy or sell a stock. You are responsible for your own investment decisions. Do your due dilligence before you invest in any securities. u/Capitalismquirk will not be responsible for any financial losses or gains should you invest into any security upon reading this educational article.

Submitted February 11, 2022 at 05:51PM by capitalismquirk
via reddit https://ift.tt/UnmSHLa