Special Alert – Exiting shares of USA Technologies (USAT)
Key point inside this special alert
- We are issuing a Sell and removing USA Technology (USAT) shares from the Tematica Investing Select List. As we close out the position, we’d note a gain of 17% was had with the shares.
This morning shares of Digital Infrastructure company USA Technologies are getting hammered, yes hammered, on the news the company it is conducting an internal investigation into the accounting of certain of its present and past contractual arrangements and financial reporting controls. As a result, the company said it would not file its Form 10-K annual report with the SEC by the Sept. 13 deadline, but it will file a Form 12b-25 notification of late filing, to provide it with a 15-day extension.
As the trite saying goes, I’ve seen this movie before and there tend to be at least two issues at work. The first is management credibility, which has clearly been called into question. The second is the actual findings of the investigation, which could range from a restatement of past financials and re-jiggered expectation to a management change. All of those are likely to add an extra layer of uncertainty into the equation, which likely means the shares will be rangebound for a protracted period of time.
I’d rather leave with our profits intact and focus on the opportunity to be had with the several new thematic additions we’ve made over the last few weeks.
- We are issuing a Sell and removing USA Technology (USAT) shares from the Tematica Investing Select List. As we close out the position, we’d note a gain of 17% was had with the shares.
