Seeking Alpha Contributor Sentiment and Performance: One Writer's Experience, Bearish Update

by: Rocco Pendola

Several months ago, Purdue University researchers published the results of a study that looked at how Seeking Alpha contributors fare with regards to providing "valuable information" to readers. At the time, I made the promise that I would hold myself accountable by publishing the results of the sentiment I put forth in my Seeking Alpha articles.

While I have made a couple of updates, I chose to post them as Seeking Alpha Instablogs. The "problem" with instablogs is that not as many people get to see them as Premium-level articles. From time to time, I think it makes sense to provide these updates to the largest audience possible. Not only will this help you track my performance, but it also provides an update on the key stocks I cover. I urge other contributors to work in how they perform -- when it's "bad" or "good" --over the course of their writing. At day's end, providing this information not only helps the reader, it also aids a contributor's growth and evolution.

In this article, I look at stocks I went bearish on. To see an article highlighting my bullish plays, click here.

Company Name (Ticker) Date, 1st Mention Entry Price Closing Price, 6/07/2011 Performance
Activision Blizzard (NASDAQ:ATVI) 3/18/2011 $10.61 11.57 -9.0%
Build-A-Bear Workshop (NYSE:BBW) 3/25/2011 $6.25 $6.64 -6.2%
Rite Aid (NYSE:RAD) 3/25/2011 $1.05 $1.09 -3.8%
Coinstar (NASDAQ:CSTR) 3/25/2011 $46.11 $48.44 -5.1%
Yahoo! (YHOO) 3/25/2011 $16.96 $15.45 +8.9%
Research in Motion (RIMM) 3/25/2011 $56.89 $37.82 +33.5%
Sino Clean Energy (SCEI) 4/04/2011 $4.30 $1.83 +57.4%

I ran the numbers and, had you shorted 100 shares of each stock at the above-listed entry price and closed the position at Tuesday's closing price, you would have fared well. You would have effectively shorted for a credit of $14,217 at entry and covered with $12,284 for a profit of $1,993, excluding commission charges and margin interest. That translates to a gain of 15.7%. Of course, if you played only RIMM and SCEI that number becomes quite a bit more impressive. On some of the small losers, it doesn't.

I remain bearish on just about every stock on the list, with the exception of CSTR. Before turning bearish, I was actually bullish on CSTR. Having felt like management burnt me with false promises of a streaming service and an accompanying partnership, I got out. It did not feel great watching CSTR calls expire worthless.

That said, my bearish turn did not represent a wholly emotional reaction. While I would not make a bearish play today, I think the possibility of a takeoever is all that currently holds CSTR up. Beyond that, an update from Coinstar management on their plans would be excellent. Light on details, I would not necessarily call the company's April 28, shareholder breifing "informative." Unfortunately, I think the potential M&A activity outweighs suspect management in this case. I guess I am neutral CSTR, meaning I prefer not to take a side for the time being.

Disclosure: I have no positions in any stocks mentioned, but may initiate a short position in RIMM over the next 72 hours.