SP24 May 2021 09:48
Galveston - I have a large holding in PFC too.
Whilst I appreciate that we are all entitled to assess risk in our own way (and acknowledging that none of us know the way the SFO case will pan out and I thought your discussion with Paddy and Poker was a useful trot through the maze), it seems to me that the question - to hold or not to hold - is a bit more binary.
Present macro issues aside (which are markets driven not PFC specific), the real question is whether the full extent of any bad news for the SFO is already written into the SP. At ATL levels a couple of months ago, it might be argued that more or less whatever the SFO said was (written in). Yes, there’s been a 35% rise since and that might be wiped out on seriously bad news but anything else might well be a positive for the SP.
So, IMO, predicated upon the melded SP that each of us are holding, the question is whether we individually consider (based upon our potential hold period) that the upside for the SP has the potential to be satisfactory (and implied in that is whether the SP risk & reward is better than any other known shares).
IMO the risk (SFO and, perhaps more important, the aggregate size & margin on new contracts) is more than balanced by the potential upside (and better than other known alternative share opportunities).
You may say that all this is trite but I put it out there just as a check / balance against SFO fixation.
And, I do agree with Paddy that the shorters reduction lends confidence (but that could turn quickly if SFO, back-log reduction etc does not go the way we all wish).
Anyhow, GL in your stick or twist decision. My intention is certainly to hold medium term (not least because I’m melded under £1).
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