You're the octogenarian billionaire owner of a beverage company that has caught the attention of the young and hip and your stock has shot up 88 percent this year, so what do you do?
You lash out in a press release.
Nick Caporella, the CEO of National Beverage Corp., is complaining about speculators in his stock. Just 15 percent of daily trading volume is based on how the company is doing, he said Thursday in his press release, which is peppered with exclamation points and all-caps. More than 50 percent of the trading, he said, is being done by gamblers.
Worse, he suggested, short sellers (who borrow shares to sell them and then buy them back later hoping to profit, thus betting on a price decline) are in a "stampede aboard" the passive trading wagon.
"If you have the opinion that I, Nick Caporella, am angrily exercised while extremely fortunate to be guiding FIZZ, your opinion is quite accurate!" he wrote.
FIZZ is the Nasdaq trading symbol for the Ft. Lauderdale, Florida, maker of soft drinks and other beverages under brands like Shasta and LaCroix. Its shares are down 8 percent this week though up 88 percent this year.
The shares seem to have taken a turn for the worse in the current quarter, falling 22 percent this month after soft drink giant Coca-Cola announced plans to buy rival Topo Chico, maker of lime flavored mineral water. FIZZ's most recent high was $129 in September.
National Beverage has had a huge hit in LaCroix, a brand of fruit-flavored fizzy water popular with Millennials.
But an analyst at Susquehanna Financial recently put a tepid rating on FIZZ and suggested the market for flavored sparkling water is getting crowded. And Credit Suisse's analyst on the stock said the probability of it being acquired is reduced because the shares are too expensive and possible bidders are building their own sparkling water brands.
Online chat rooms for investors are buzzing.
"Are perpetrators stimulating self-serving movement by stating falsehoods, creating rumors and deliberately manipulating FIZZ value? We think so," Caporella said in his press release. He wasn't available when a reporter called his office.
The company has a $4.5 billion market value. Short interest in the stock, as reported by Nasdaq, is about 2.1 million shares, but that is down from various points during the summer and last year around this time.
Average daily trading volume in the shares for the last three months was 318,000 out of a total of 46 million shares outstanding. But here's the thing. Caporella, whose net worth according to Forbes is 3.7 billion, owns about 75 percent of those shares, restricting the float and potentially making the stock prone to volatility.
Still, of that float, 18 percent of the shares are sold short, according to FactSet, a sizable amount for a consumer staple stock.
Here's a link to the full press release.
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