Member Info for giantsquid

There's little doubt the main reason the share price has been stuck in the doldrums these last few weeks is due to R&M having to sell their holding, as stated in the February 25th RNS. As is usual when an ii offloads, it creates a stock overhang which can take several weeks to clear. Well it's been several weeks now, so there's a pretty good chance we'll see a breakout this week. The £115m represents an increase in shareholder value of around 7p a share. What's more significant though is the results were very positive - but were released at a time when a big ii was selling into the market, hence the share price remained depressed. Once the overhang clears however, with nothing to hold the share price down anymore, we should see a belated bounce based on all the positives in the results. From such a low base, we could easily see 50% or more, into the mid to high 30's. The results were very positive - I wouldn't entirely rule out 40p+ in the coming weeks.

Eddie v Thor big fight live :
https://youtu.be/GSIQ1VEs8ew

No problem mate. But you've missed a good article.

Would the lovely pleasant shareholders on this board like me to post this very positive sounding article I've found on Cineworld? The article features an interview with Mooky. All you have to do is say yes please squid and I'll post it. Any abuse and I wont.

When an ii sells, if all the shares were sold into the market at once, it'd crash the share price and probably the shares would have to be suspended due to volatility. That's why they tend to be drip fed over a number of days or weeks, ie, you have a stock overhang until all have been sold. They may have officially declared their intention to sell on the 22nd, but that quantity of shares can't be sold in one day - it has to be done over the course of many days, a bit at a time. Even offloading a little at a time still causes the share price to remain in a depressed state until it's all gone.

It's interesting how this went straight to auction at 8am today and came out briefly at 23.5p. The overhang is close to clearing I suspect - those huge after hours trades are more likely to be sells in my opinion, the remnants of River and Mercantile's stock holding, which have now been sold into the market. Whether that's all of them remains to be seen, but it's been a couple of weeks since the Feb 25th RNS, so I don't think there's much left. I strongly suspect we'll see a breakout next week.

I think next week could be a particularly bad week for shorters. I think next week could be a good one for holders..

I'd rather it be a sell tbh. If there's an overhang, which I suspect there is, a clear sign the overhang is clearing are the colossal sells which usually appear after close. The sooner the overhang is gone, the sooner we start moving up again. I've seen it before where a stock overhang has held the price down, typically for about 2 weeks. You know it's gone when the share price suddenly springs into life and shoots straight up, bringing an end to many days of being stuck in the doldrums.

When there's a stock overhang, you often see huge sells at close as the overhang clears, not sure if that's what we're seeing - I don't normally pay much attention to UT. Next week could be the week the overhang clears and we see a proper re-rate. Could be an interesting week, we'll see.

Cane toad, it's buy low/sell high... Not buy high/sell low

The River and Mercantile holdings RNS was 25th February - in the days immediately after that, the price fell around 25% where it's been eversince. It's too much of a coincidence - It's highly likely there's a stock overhang. The price action is behaving exactly as you'd expect if a large number of ii shares were being sold into the market behind the scenes. The results were published at a time when these shares were still being offloaded into the market - that's why the market seemingly didn't react to what was actually a very positive set of results. But that's perfectly normal when there's an overhang - nothing but nothing can lift the price until the overhang clears. The good news though is at some point relatively soon the overhang will clear - could be as early as next week. Once it's gone, the share price will no longer be held down and we could see a particularly strong bounce from such a low base - because the price, somewhat belatedly, will finally be free to re-rate based on all the positives in the latest results (plus the £115m the company will soon be in reciept of). We could very well see 30p to 35p+ once the overhang clears - and it could be as early as next week.

River and Mercantile recently sold some or all of their shareholding I believe? Which would explain what's causing the depressed share price - ie, there's a stock overhang. Once all their shares have been sold into the market, the overhang will be gone and we'll likely see a bounce. The price action is very much reminiscent of what you'd expect to see if there was a stock overhang to clear.

£115m ÷ 1,684,273,523 shares in issue = 7p per share
On reciept of this money, we could/should see a jump to around 28p to 30p or so.

At least I time my entry right sms. Unlike you matey.

Sms, I don't consider it ramping suggesting the price could hit the mid to high 30s over the course of the next few weeks/months. It was 55p less than a year ago when fundamentals were worse and when the pandemic was still raging and affecting businesses widely. The pandemic is now waning fast and the company is in a much better place - hence the optimistic outlook. Nothing I've said even remotely constitutes "ramping". Idiot.

Sms, the share price was over 100% higher a year ago - and the company has made a lot of progress since then. If the share price was 40p-50p a year ago when fundamentals were significantly worse than they are now, when covid was still impacting the business and the wider economy, why are you only anticipating a re-rate of 10% now? Something tells me investing isn't your strong point?

It's a big ship to turn around but It's heading in the right direction and the share price is on the floor. Any potential downside from 21p is likely to be very limited, whilst potential upside could be huge - it's easily capable of multibagging from this price. The crucial thing is the company is heading in the right direction - it's an improving situation. It may be taking time, but over time the picture should continue to be an improving one. And that will likely mean the share price tends to trend upwards over the coming weeks and months.

1Y Chart looks primed for a rise back to the mid to high 30s

I don't personally think cineworld can be saved. It'll never be a takeover target because it's up to it's eyeballs in debt, so no potential buyer would touch it. And the debt situation is only going to get worse if money going out continues to far exceed money coming in. If the appeal is lost that'll be the end imo. The share price will hit new lows and from then on it's only a matter of time before the company goes into administration. It's a sorry story of a once fabulous company with wonderful cinemas being systematically ruined, driven into the ground and burdened with unnecessary debt due largely to bad management. Had mooky not attempted to take over and conquer the world, you'd have a smaller but much healthier, fitter, leaner cinema chain with minimal debt and a much higher share price. The problems started long before covid. The most likely outcome, in my view, is the company will end up in administration and other operators will snap up the company's assets at a knockdown price - shareholders in that situation being left with little or nothing. Maybe Vue cinemas will end up buying up some sites, along with odeon, for example. Whatever happens to the company, I think there's a good future for cinema and many of Cineworld's sites will no doubt continue to trade, just under a different name.

Cineworld is looking at options to raise more cash after warning that there remained “material uncertainty” over its ability to pay down debt and continue as a going concern

https://www.ft.com/content/7dab69a9-2478-4bf3-a9a2-abd32965f0a1