187226743 - 1_dnm45vnk - PID 1851201
    
    
      
    
  

  
    
        Hi I am Ted Dixon with
        your INK Morning Report
Preview
        for October 8th.
        Who will win the Winpak
squeeze contest?
        Short squeeze or margin
squeeze?
        In our latest short
report,
        packager Winpak showed up
as one of
        the stocks with the
biggest
        falls in short positions.
        Nevertheless, the shorts
are
        betting against the stock
        and it has high insider
commitment
        and a bright INK Edge
outlook.
        That suggests that stock
        has a potential
short-squeeze setup.
        However, the shorts may
        be betting on another type
        of squeeze and that would
be margins.
        Looking at Refinitiv
profitability data
        found in the Valuations
tab
        of the company page,
        recent 12 month margins
have
        been trailing their 5 year
averages.
        As management explained in
their Q2 results,
        rising input costs are
        a key reason why
        those margins have been
falling.
        As it turns out, the
company
        has some protection in the
form of
        pass-through price
agreements that cover
        about 67% of Winpak's
revenues,
        albeit with a lag.
        In addition, Winpak
reported
        some success in passing
through
        price increases to
customers
        not subject to automatic
indexing.
        Deflationists please take
note.
        Meanwhile, the stock is
        attempting to stay above
its 200-day moving
        average and is trading
just above
        the level where we saw
        some insider buying in the
summer.
        Winning the squeeze game
        may well come down to
whether the company
        is able to keep pace with
        inflationary forces by
passing
        through input price
increases.
        Q3 results should give
        us our first look at
whether
        Winpak investors and
insiders
        can win the contest with
the shorts.
        Well thanks for stopping
by and
        click on the notify button
under
        this video on INK Ultra
Money to be notified
        when we have our next
preview available.
        You can also follow
        us on Twitter
@inkresearch.
        That is all for today and
I hope to
        see you again next week as
        we let the insiders
        guide us to opportunity
this fall.
        This is not a
recommendation to
        buy or sell securities and
        nothing in this video or
        in INK reports should be
considered
        financial advice
information is for
        educational purposes INK
employees may
        hold an interest in
        any stock mentioned in
        our videos or in our
reports.