Extend Alert: Despegar (DESP)

By Jim Pearce • July 25, 2018

As I mentioned my Portfolio Update earlier this week, I am extending our hold period for Despegar (NYSE: DESP) two more months from July 26 to September 26: “The company announced a shake-up in the C-suite last week, and I want to see what sort of guidance the new CFO provides (if any) when the company releases its Q2 results next month.”

From a technical perspective, DESP bounced off its lower Bollinger Band a few days ago and crossed over its 50DMA yesterday. At the same time, its RSI is approaching 50 and is higher than it has been in two months. I’m not expecting fireworks, but I believe we can close out this position at a better price in a month or two than where it is has been trading lately.

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Jeff L.

07/25/18 ‐ 10:05am ET July 25, 2018 at 10:05am ET

Thanks Jim for the update.

Janis Bell

08/16/18 ‐ 5:00pm ET August 16, 2018 at 5:00pm ET

Hi Jim,
Do you still think there is a chance DESP will reverse its downtrend? All I could find on the earnings report online is that it was supposed to be released today.

Jim Pearce

08/17/18 ‐ 9:21am ET August 17, 2018 at 9:21am ET

Despegar did release Q2 results yesterday: https://finance.yahoo.com/news/despegar-com-announces-2q18-over-100000277.html. Despite the solid results, the stock dropped on concerns that ongoing political unrest in Latin American will impact future results. I am going to hold on to DESP through the extended hold date of late September to see it its temporarily depressed share price attracts any potential acquirers or activist investors to take action.

Pat C.

08/17/18 ‐ 9:39am ET August 17, 2018 at 9:39am ET

Not sure the results were solid. What does it mean Tiger Global is registering their shares to distribute to LPs? Think we should have bailed on this turkey back at the support level of $24. Would have saved a lot of headaches. Don’t think letting investments go to big losses is a good strategy.

Pat C.

08/17/18 ‐ 2:34pm ET August 17, 2018 at 2:34pm ET

Sold another half at $17.00. If Latin America turns around and if there is a buyout at a big premium, I can get some of my money back. But at least I’ll slow the bleeding if it keeps dropping.

Freddie

09/27/18 ‐ 5:49pm ET September 27, 2018 at 5:49pm ET

Hi jim- sitting on big losses in desp- yesterday was the end of your extended holding period. Whats next?

Jim Pearce

09/28/18 ‐ 9:43am ET September 28, 2018 at 9:43am ET

I’m still mulling over what to do with DESP and will issue an update later today as to what I am going to do with it in the portfolio.

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