Author: Melanie Hollands
Shares of SCO Group had rallied 66 percent since Nov. 2, from a 17-month closing low of $2.85 to close Dec. 3 at $4.74, although it’s since pulled back some. During the first week of November, SCOX rallied over 25 percent; then, after leveling off for two weeks, rallied 11 percent and 18.5 percent during the weeks ending Nov. 26 and Dec. 3, respectively.
The run-up was driven by recent Microsoft rhetoric about Linux, information made public about a case similar to SCO’s case against IBM, and increased speculative activity. Furthermore, at its lows, SCOX was technically oversold, after weeks of heavy selling by BayStar Capital Management attempting to monetize its recently converted position, SCO’s failure to set an expense cap for its lawyers, and legal developments related to the IBM case.
