After a 26% Gain in 3 Months – Stepping to the Side on Angie’s List

After reaping a 26% gain short-selling ANGI (NASDAQ:ANGI) over the past 3 months, I have decided to buy-to-close.

Similar to when I last closed my Angie’s List short in December, board members have been making small open-market purchases. Until the business model changes, nothing really will here either, but in the past, board member open market purchases have been a good short-term indicator of a bounce. The stock subsequently rose 50% from December thru January.

I also believe that the recently installed Chairman could finally light a fire under management. The firm laid off 97 sales employees and re-structured the commissions system earlier this month. Perhaps this was an admission that the current business model is unsustainable? Time will tell.

During a period when most Internet sector stocks have risen to ludicrous heights, ANGI has been a great short for me. The stock is down 50% since I my short position in October, but I believe the board shakeup could portend changes to the Angie’s List subscription model. For now, I move back to the sidelines.

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Author: secondhandstocks

The genesis for this blog stems from a Marine buddy and I came back from Afghanistan with more money than knowledge, and heedlessly tossed our hats into the stock market ring. A few months later, I remember discovering the classic book The Intelligent Investor by Graham and Dodd, and ravenously devouring my first introduction to value investing. That framework - with some generous additions by Seth Klarman, and Joel Greenblatt among others - guides my investment philosophy. I spent five years working in the intelligence field, both in the Marine Corps and then for a government agency after that. I speak Arabic and Pashto, have programming and analysis experience, and enjoy investing in technology companies as a hobby. I also spent a year on Wall Street working on a #1 Ranked Institutional Investor team, before deciding that that the Sell-Side was not for me.

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