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So at par with cash is c8.50p.
To think you can buy below that is slightly crazy. Now I know there are the odd exception where shells do trade at cash levels but the BIG difference here is that the directors do NOT get paid. And we're not even trading at cash levels!
So buying below 8.50p you're getting instantly more money for your buy price and someone else is working for you, for FREE lol. Crazy really.
Also, the sector the bod want to go into, green batterys, looks v lucrative and expanding very fast.
GLA
Something has really sparked ARA into life today, which is quite appropriate for a potential battery stock!
Seventh on the top risers list, up 13.6% (by 0.75p, to 6.25p).
And what's also noticeable is the record daily volume of 548,789 ARA shares traded.
That's actually over 5% of the shares in issue, and is double the previous record.
From the recent video interview with ARA's Chairman John Croft:-
"... we're very hopeful, put it like that, that we can do a transaction in this year. The sectors that we're particularly interested in are in energy storage generally, but particularly in battery technologies.
... there's a huge opportunity there ... I'm very hopeful we'll do something this year.
... with the minimum capitalisation having been moved up to thirty million pounds, it means actually that that valuation of the SPAC in the context of an overall transaction is relatively small. So we're starting to see valuations for SPACS in transactions heading up, and recently there have been some in London where the SPAC has been valued at multiple times of its cash balance, and multiple times the value of its original market cap. at the time it came to the market. So we see that as being very encouraging, and a positive sign for our shareholders going forward. ..."
https://www.proactiveinvestors.co.uk/companies/news/1012600/aura-renewable-acquisitions-very-hopeful-of-making-a-transaction-this-year-1012600.html
Remember that to complete a RTO transaction this year, you would really need to sign heads of terms in H1, to allow time for more detailed preparations, including prospectus preparation and FCA approval of.
So a deal could potentially be imminent.
And for ARA, these are the interview multiples concerned:-
2 - 3 times current cash = c. 15p - 22.5p / share
2 - 3 times IPO price = 20 - 30p / share
Compared to the current ARA s.p. of just 6p per share.
A further 289,528 ARA shares traded today, the second highest daily volume in the company's history.
Which means that the company's two highest volume days, in well over a year since listing, have occurred on Monday and Tuesday of this week.
Which should be setting the stage for some really tasty share price action here shortly (unless the share is suspended for a RTO first, at a massive premium).
"Volume Always Precedes Price
Tom Aspray Contributor
Jan 11, 2014,03:30pm EST
This statement is one of the cardinal beliefs held by most technicians. ..."
https://www.forbes.com/sites/tomaspray/2014/01/11/volume-always-precedes-price/?sh=5fa58c3b18a3
'Cash is king' at the moment, and ARA has it, and is trading at a significant discount to it.
And at its current very low rate of cash burn, it would take years for that discount to be eroded away.
In theory it could arrange a RTO of a profitable company without having to raise any further funds, though it will probably want to raise at least some to accompany a battery tech RTO.
But it wouldn't necessarily need to be a particularly large amount, and the enlarged entity could look to raise more later - which could be in better market conditions, after company progress, and at a higher s.p.
There is still some small cap equity investment money available, especially for good value and quality companies, and the situation seems to have improved this year. This is shown by some recent new issues this year, like Ocean Harvest Technology Group (OHT), and World Chess (CHSS).
But the IPO route can be quite risky and uncertain - if the IPO has to be aborted, due to market conditions, then the company trying to float can be saddled with huge costs but with nothing to show for it.
The RTO route, into an already listed shell like ARA, is safer and more certain.
And the fact that the company reversing in may have to give away far less equity than in a IPO can be a major attraction, especially if the price being offered is seen as low.
With regard to the choice of shell for a floating company, such companies won't have to look far to see what good value ARA is compared to other shells, as well as having very attractive management.
So it's no surprise that ARA is seeing a very healthy level of interest in reversing into it, enabling it to express deal confidence in the way that it has.
I would add that there seems to be an inverse correlation between the salaries of shell directors, and RTO success.
Unpaid directors have no incentive to spin things out to retain their salaries, but rather have a real incentive to get something done ASAP, as well as being of the highest level of integrity and professionalism.
Change % Chg Cur Bid Offer High Low Open Volume Chg Time RN NRN
0.25 4.3% 6.00 5.50 6.50 6.00 5.45 5.75 359,799 09:00:15
Another big volume share trades day today for ARA - it's second highest ever - has seen it close back up at 6p.
This makes c. a couple of million ARA shares traded in c. the last month - nearly a fifth of the shares in issue.
Such big volume ahead of an anticipated RTO deal seems very significant and exciting.
And share buying tends to be more significant than selling.
Because buyers have thousands of shares to choose from, whereas sellers may only have a few ... and in some cases may have no choice but to sell.
My gut feeling is that big, exciting RTO news here is now probably imminent, and that we are now in the 'end game' of share trading ahead of this.
It is standard practice in a RTO to give a value of a minimum of £200K.+ for the stock market listing.
That being the case, then ARA's minimum fair value with it's cash looks to be about 1p/share, i.e. the price it listed at.
So at just 6p/share this is looking well undervalued: indeed the most undervalued traded UK shell that I am aware of, but paradoxically with some of the most impressive management.
And there looks to be little chart resistance between the 6p and c. 7.5p levels.
So with ARA nicely poised at 6p, and exciting news expected soon, then a swift and strong move upwards from this level would make perfect sense.
I think you mean 10p Hedgehog and not 1p
Thanks for the correction Jessie, and sorry for the mistake.
Small shells generally float at a single figure share price, e.g. 1p v. 10p.
Though of course it doesn't actually make any difference to the market cap.: you just have far more shares in issue at a far lower price.
Recent Share Trades for Aura Renew Acq (ARA)
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
29-Jun-23 13:51:39 6.17 50,000 Buy* 5.50 6.50 3,085 O
29-Jun-23 13:40:56 5.90 25,000 Buy* 5.50 6.00 1,475 O
29-Jun-23 13:09:42 5.6125 50,000 Sell* 5.50 6.50 2,806 O
29-Jun-23 13:08:12 5.61 59,570 Sell* 5.50 6.50 3,342 O
Today's brief intraday ARA s.p. dip was very well-bought: lasting for just half an hour before a buyer pounced on the bargain, triggering a full rebound.
And time must surely now be running out to buy in ahead of RTO news here.
Recent Share Trades for Aura Renew Acq (ARA)
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
30-Jun-23 15:07:43 5.90 50,000 Buy* 5.50 6.00 2,950 O
30-Jun-23 13:40:14 5.6501 50,000 Sell* 5.50 6.50 2,825 O
30-Jun-23 13:39:53 5.71 50,000 Sell* 5.50 6.50 2,855 O
And today's brief intraday ARA s.p. dip was again very well-bought: lasting for under an hour and a half before a buyer again pounced on the bargain, triggering a full rebound.
It's a typical pattern with shells that some people get tired of waiting for a deal, and throw in the towel close to the bottom, shortly before a RTO is unveiled.
Experienced investors can work this pattern to their advantage though, to pick up bargains shortly before news.
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
06-Jul-23 10:35:07 5.88 50,000 Buy* 5.50 6.00 2,940 O
06-Jul-23 09:24:05 5.666 50,000 Sell* 5.50 6.50 2,833 O
Once again, ARA shares sold today very quickly attracted a buyer.
And in general, buying tends to be more indicative than selling.
Because sellers sell for many reasons, whereas buyers only tend to buy because they think it's a good investment.
And sellers may well have a limited choice of shares to sell, whereas buyers have a choice of thousands.
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
07-Jul-23 10:29:32 5.84 39,100 Buy* 5.50 6.00 2,283 O
Another bargain ARA buy today.
That's 214,100 ARA shares bought in just the last 7 trading days: which is over 2% of the company.
Recent Share Trades for Aura Renew Acq (ARA)
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
18-Jul-23 10:00:19 5.80 45,000 Buy* 5.00 6.00 2,610 O
18-Jul-23 08:03:01 5.825 3,433 Buy* 5.00 6.00 199.97 O
More ARA buying today, lifting the s.p. back up to 5.75p.
For shells, which tend to be very lightly traded, such relatively persistent and steady buying as ARA has seen recently tends to be a very positive sign.
Recent Share Trades for Aura Renew Acq (ARA)
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
25-Jul-23 13:34:06 6.40 31,001 Buy* 5.00 6.50 1,984 O
25-Jul-23 12:02:19 6.20 23,976 Buy* 5.00 6.50 1,487 O
So the last of the sub 6p ARA stock has gone, and the latest buy paid 6.4p.
These are actually the first ARA buys for over 6p since June, and the mid price should follow suit shortly if this trend continues.
Seems a good bet IMO Hedgehog. I've made a few purchases over the last few weeks. Seems to be that listed cash shells are now a dieing breed, and if you want to see how ridiculous the price action can be, check out the performance of ITS, which was up until yesterday a cash shell on the verge of de-listing with very little cash and no BOD intent on undertaking an RTO. That changed with an RNS yesterday. It was 0.2p Friday and today traded at over 4p... circa 80k cash, 53 million shares in issue. If I compare those fundamentals to what we have here, it could give an indication of where things can go with these types of companies... AIMHO GLA DYOR
Yes MM, the penny share market is showing some signs of excitement at the moment.
As I write, the top three risers today are all up over 100%:-
Top Risers
Share Price Change
Actual Experienc... (ACT) 1.425 +147.83%
Aptamer Group (APTA) 8.00 +113.33%
Rtc Grp. (RTC) 37.50 +108.33%
ARA's day should come.
We have the quality and value, and positive news should be forthcoming shortly.
What providers do you use to hold your investments with? Tried to buy this share in my ISA and my provider is saying this investment can't be held in an ISA. As far as I'm aware this is just an ordinary share. What types of accounts are people using then, just general investment accounts?
It can be held in an ISA, what provider are you using?
Recent Share Trades for Aura Renew Acq (ARA)
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
27-Jul-23 14:45:18 6.50 77 Buy* 5.50 6.50 5.01 O
27-Jul-23 12:00:16 6.06666 3,884 Buy* 5.50 6.50 235.63 O
27-Jul-23 09:08:17 6.425 25,000 Buy* 5.00 6.50 1,606 O
27-Jul-23 09:02:36 6.40 20,000 Buy* 5.00 6.50 1,280 O
ARA has today moved back up to 6p mid, for the first time since 5th. July.
And that small £235.63 trade actually looks like a sell for over 6p, so the 'real' mid price is now 6.25p (spread 6p - 6.5p).
A close above 6.375p mid (the 22nd. February close) would be a new 2023 closing high.
RazorShultz - ARA is a Main Market share, but even if it was AIM, AIM shares have been allowed in ISAs since 2013.
Is it just an ISA issue, or will your broker just not offer dealing in this shares out of ISAs either?
When you have companies with approx 10% of the cash this has, but a market CAP of 2.5x value here. That doesn't make much sense to me. This is also a main market shell, not AIM.
I'm missing something surely.
I may be missing something...
Thanks hedgehog and mr magorium, I have queried it with my broker, I suspect they have just mis-categorised the share somehow.
You're welcome RS.
And you're not really missing anything, MM. The shell ITS is massively overvalued, and ARA is massively undervalued ... at the moment.
Recent Share Trades for Aura Renew Acq (ARA)
Date Time Trade Prc Volume Buy/Sell Bid Ask Value
31-Jul-23 08:39:12 6.50 5,923 Buy* 5.50 6.50 385.00 O
The full ARA buy price of 6.5p in now being paid, for just a few hundred pounds of stock.
So there can't be much more 6.5p ARA stock available now.
Only 1 trade today ..looks unlikely to be a sale at that price!imagine if there was concerted buying!
Definitely looks like a buy... I saw another shell got snapped up today (ALTE) I suspect we may either see some more TR1's off more savy investors or an intended RTO announcement soon enough? Trouble is, there's only 10 mil shares in issue, so they are very unlikely to be getting the shares at this level for too long.
Hedgehog bought my attention to this one, so deserves the credit, looks like a good spot by them and hopefully a fruitful investment opportunity for those taking a position.