NEW BEARISH Plays

Textura Corp. - TXTR - close: 25.67 change: -0.85

Stop Loss: 27.05
Target(s): 20.25
Current Gain/Loss: unopened

Entry on February -- at $--.--
Listed on February 20, 2014
Time Frame: 6 to 8 weeks
Average Daily Volume = 617 thousand
New Positions: Yes, see below

Company Description

Why We Like It:
TXTR is in the technology sector. The company is a cloud-based application software company for the construction industry. The stock has had a bumpy ride. TXTR came to market last year on June 7th, 2013. The initial IPO pop failed but TXTR found support near $20.00. Four months after its IPO shares of TXTR were trading near $45.00. Unfortunately for shareholders it's been a bumpy, terrifying ride lower since then.

TXTR lowered their earnings guidance when they last reported earnings on January 30th. This news sparked the most recent sell-off. Now TXTR is on the verge of breaking down below support near $25.00. If that happens it could signal a quick drop toward the next support area near $20.00.

I am suggesting a trigger to open bearish positions at $24.85. However, we should consider this a higher-risk, more aggressive trade. The most recent data listed short interest at 33% of the very small float of only 21.8 million shares. That does pose a risk of a short squeeze. Traders will want to seriously consider limiting their risk by using put options (your risk is limited to the amount you paid for the option). If triggered at $24.85 our target is $20.25.

FYI: If TXTR trades below $25.00 it should create a new sell signal on its point & figure chart.

Trigger @ 24.85 *small positions, consider using the option!*

Suggested Position: short TXTR stock @ (trigger)

- (or for more adventurous traders, try this option) -

Buy the MAR $25 PUT (TXTR1422o25) current ask $2.00

Annotated chart: