Just bought in today with a small amount. Will add if drops further. When looking at the trades it gives impression the sp is dropping on pi's selling due to no news given yet the big trades going through are the directors buying. As he said "buy when others are fearful". Gla
Pre-IPO Chairman buys shares
I am encouraged (just a little) to see the Pre-IPO RM2 Chairman J Dekker buying shares yesterday at 70 (should have held off a day or so by the looks of things!) adding to his holding. Is he averaging or just thinking it's looking cheap. We'll know when we hear something whenever that may be!
A treat for you
This weeks investors chronicles said: RM2 International (RM2) makes and hires out super-strong composite pallets used to shift consumer goods, food and drugs around the globe. Its pallet tracking and management software tells them where they are, too. RM2, which reportedly makes about 1m pallets each year, only listed on Aim in January, raising £137m at 88p a share. It will use the money to ramp up production to almost 3m pallets in 2014, estimates broker Cenkos Securities, and 6.4m pallets the year after. Sitting former Marks and Spencer and Diageo chiefs – Stuart Rose and Paul Walsh – on the board has clearly generated interest. Fund manager Invesco increased its stake from 28.5 per cent to over 40 per cent, too. Yet, RM2’s share price has drifted steadily lower. Canadian chairman and private equity man Ian Molson is unperturbed. In fact, a discretionary trust established mainly for the benefit of his children, has snapped up 1.5m shares for as little as 70p. Maiden results – full-year 2013 – must be published by the end of June. In the meantime, Cenkos estimates RM2 will make a small profit this year after an underlying loss of $16.3m in 2013, and then only $28m in 2015, giving underlying EPS of 7¢, and $64m and 16¢ in two years’ time. A forward PE ratio of over 17 looks generous enough. Hold. LW
RE: Some thoughts
thanks for a thought provoking post. I think the early investor selling is the more telling point, I observed the selling started immediately and continued until it reached about 76p, no doubt compounded by a few stop loss trades. It seems to me it was in weak hands before it was listed. Since then it has moved down very slowly, like a lot new shares with no new information. Good director buys and no negative 'changes to holdings' of II's, are both positive signs , but I agree with your point about not buying until move upwards.
As I said in an earlier post, I don't normally comment in these forums, I do not have a position in this stock but I am a keen onlooker as I have a few good friends who have owned stock for several years (all bought pre IPO). The share price performance has absolutely nothing to do with fundamentals and everything to do with the enormous amount of speculative interest in the company. With the greatest of respect to everyone, you guys are not investors, you are traders. The only facts that we really know are that the management have only ever bought equity and never sold any, the IPO was hyped, RM2 appeared on a large number of 2014 tip lists and there are a large number of traders who are under water and desperately searching for something to help their cause. In reality the IPO was very badly handled with way too much stock going into weak hands. The daily volume in this stock to me suggests that all of the activity is speculative with the odd large trade probably being a disposal by an institutional investor or pre IPO holder. There were rumours (and I stress rumours) that and early investor had leveraged his position with his bank who were forced to sell from under him. Despite all the protestation, the management will not comment on the share price until they either have to or they have something important to say. They certainly will not respond to the requests of a small group of traders So, in conclusion what happens next? There is every chance this share price falls further before it rallys. For me I wouldn't buy a share until I saw an increase in volume accompanied by a move upwards.That said, if a couple of institutional investors were to start buying, the lack of volume would probably mean a sharp rally. However, lets look again at what we know; the management continue to buy shares and although our history books show us that management are awful when it comes to the timing of such trades, they are almost always right in the long run. This time next year Rodney.......
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