Thinksmart Ltd Share Price (TSL)

Interestingly even after the dust has settled, the special dividends given this still trades at a 2.9p a share discount to the current buy price (38p) and a 5.9p discount to the current offer price.

This means if the winding up vote goes through (see my earlier note it's madness to keep a £2m/year admin cost of a Plc going after October when it's only asset/operation are Block shares.... you lose about 5% of your holding per year while you wait!), there's a 14.4% return in 3 months to today's price plus (or minus) and movement from Square's market price (currently $85.94)

GLA

Too much short-termism in a lot of the comments on here from people who bought in on the lows after the directors shafted the existing holders with a derisory deal woefully undervaluing TSL and it's potential. This initially looked good value when ST at Investors Chronicle tipped it up around the 70/75p mark and progressed to around £1.10. Soon after the sp tumbled following a very questionable and surprisingly low-ball priced deal announcement and here we find ourselves....

Personally I think we should see how this progresses now the bottom has been hit. The directors owe the shareholders that backed them more than this. They're suggesting take the cash (for many a 50%+ loss on their investment) and just invest the funds in Block at market price if you're still keen on being directly exposed. A decent discount on Block shares would be more appealing and fair if that were possible. Personally I'll be rejecting the offer and confidently looking to get nearer to my 70p average in a few months, like many

If Scaramucci is correct then SQ will do well in the coming months. If Bitcoin returns to $40k the unrealised gain on its BTC assets grows from $40m to $170m. $170m is only equal to 4% of SQ. market cap at today's $79 price but I doubt we would see a $79 price in a $40k Bitcoin world.

https://www.marketwatch.com/story/bitcoin-has-already-bottomed-has-a-fair-value-of-40-000-says-anthony-scaramucci-11659465805?mod=dist_amp_social&link=sfmw_tw&redirect=amp

Worth being aware the Q2 2022 results for SQ come out this Thursday evening (4th Aug).
This will be the last quarter before the vote for the scheme (in Oct).
Consensus forecast Q2 earnings per share are 16c.
Last quarter earnings were forecast 20c and actual 18c.

https://www.investorschronicle.co.uk/ideas/2022/08/01/thinksmart-shareholders-should-think-twice/
Thompson has spoken. Hold out says the Tipster - reject the scheme.

Before I give my view on this advice. First I've been pondering the return on TSL. This evening's price puts TSL holding in Block worth 37.6p (618750 shares * $77.76 block price/1.2 FX rate)/106.59m shares. Warrants dilution potentially reduces this to around 36p (which ST quotes in his article).
I would remind shareholders of our recent special dividend June 22 and the dividend from December 2021 worth a further $0.0939 = 7.8p. That puts us at 36.2+7.8 = 44p equivalent return.

My reply to ST's advice is if you want to hold Block, vote for the motion receive your proceeds and reinvest them in SQ. It costs a few pounds to do so and if you are as bullish as ST now appears to be, then good luck. I may take this route too because I see a lot of opportunity in SQ. If I hold SQ. shares I can hold them or sell them in the future - I can't do that now because they are locked inside TSL shares.

**Importantly** to keep the TSL Plc running, costs a million or more a year (assuming they reduce costs). Why prolong these costs? The call centre income is finalising so all we will do if we vote against the scheme is reduce our holding of Block squares to pay ongoing corporate costs. Moreover, if we reject the scheme what's stopping this reverting to a 40% discount like before?? Rejecting the scheme is certain to drop the price of TSL.

So why did ST advise to reject the scheme?

Is ST hoping that time will revert this back up to a point where he can point to it as a success? He can't now, and a number of people bemoan the fact they listened to his tip here. Well, Simon Thompson if you're thinking twice then I'm thinking thrice and and I *WILL* be voting for the scheme and would encourage everyone else to do so for all the reasons outlined above......

GLA...... and Think Smart :)