With Sky City Entertainment Group [SKC.NZ] announcing a profit next Tuesday, the recent dramatic drop -SKC shares have fallen by almost 9% in 2 weeks - in share price for this company could mean a number of things.The obvious reason is that investors are simply no longer interested in holding because of overall market sentiment and this has been shared with other stocks falling in a similar fashion - Telecom NZ [TEL.NZ] but one example.
The other reason could be insiders selling due to some sort of negative news coming in the profit announcement.
This stock has been prone to insider selling before profit announcements in the past and I wouldn't discount that insiders are doing the same again before Tuesday.
With a good result indicated by management last year it cant be the profit part of Tuesday's announcement but it could be a slightly worse number than telegraphed.
Perhaps a dividend cut, a poor future outlook or something unexpected is on the cards.
This is all idle speculation on my part but the big share price drop before another profit announcement is worth noting.
Of course if nothing material is going on the share price drop represents another opportunity to buy this stock, long or short term.
Sky City shares dropped 6c to NZ$3.10 in a down market on larger than average volume yesterday.
Disclosure: I own SKC shares in the Share Investor Portfolio
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