The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
All PIs, what would be the bear case behind the issue of these shares to staff at this point in time? I'm struggling to think of one. Does anyone have a suggestion?
Could it be to allow staff to cash out quick before the collapse. Seems far fetched. So why issue them now, ftom a bearish point of view?
Positive cash flow is the key to Pertofac's turnaround. The brand is strong. Clients like PFC and they can win business they've proven that. But they need to start getting positive cash from operations. So the restructuring and the overhead cuts that we've been reading about are all positive signals. Let's hope the lenders are supportive.
They can do it and if they do it the share will re-rate massively from here. Hold or buy.
The share price was at 80 when this all kicked off in November now it's at 23. And what's really changed in the fundamentals to justify a 70% plus drop? The longer term outlook if anything seems to be getting a bit better. Seems to me that the downside risk has been fully priced in already.
This RNS is not a statement from a company that is going under, assuming it is a fair and accurate reflection of what is going on at PFC. This business has a future. Hold or buy.
I agree. It was Buffet who was famously quoted as saying investing is about moving money from the impatient to the patient.
The stock is still in its long term downtrend and we are still waiting for a trend reversal. Thats only going to come with positive news. If you believe the narrative that this company will pull through and fix its balance sheet without further dilution, then hold or buy.
What a fabulous buying opportunity that would be, unless there was more bad news to support the drop. I was happy to buy this at 80. I am thrilled to get it at 30.
I personally hope shorts hold or increase into the next company RNS not reduce.
Risk on both sides here. Take your position.
Any downward effect from this, unlikely imo, is just another opportunity to buy shares at a discount. That's all. The only thing material near term is the liquidity and balance sheet solution.
Be greedy when others are fearful - Warren Buffet
Doomers are here to unnerve PIs but it's also a sign of their own nervousness. If shorts had any inside track and knew it was going under they would buy buying up shares in droves to short it or even talking up the stock so they can short it at a higher price. Not scrraming its all over. Truth is. They don't.
I'm very happy to bet the other way.
The bear case here is that the next 5 years is going to be like the last. Increasing debt. Unprofitable projects. Further balance sheet erosion. I think D4E is already at least partially priced in.
The bull case is that the next 5 years are going to be better than the last. Covid and SFO in the rear view. New leadership. Growing book of business. Projects will start making returns and the company P&L and balance sheet will slowly improve.
Nothing is guaranteed. Take your pick and get behind it.
If the shorts really knew something bad was coming then logically they would be here talking the stock up, if they would bother even to be here at all, so they can get it at a higher price. The fact they're here screaming its over is a strong signal in my opinion that they are nervous and are looking for a lower exit.
Buy and hold.
Opportunity Verging On Ridiculous
Buy dips
Hold for the new long term uptrend to take shape
These multi bagger chances don't come along very often. My last one
Ex petrofac. Flew around the world with Ayman on his jet. A long time ago. Live in Dubai. Petrofac is loved out here.
Good luck.
Just added Escallum to my bin list of doomers. I recommend all PIs do the same. This is a fabulous turnaround prospect now, thanks to this latest trading update. Build your holding while you can at these low levels and look forward to a stronger 2024.
To all PIs, well done for keeping faith. Buy the dips , hold into 2024 from here. Absolutely no selling as this will gift the shorters who will snap them up. Let the day traders have their fun, ignore the doom mongers as always and a happy Christmas to all.
What a load of nonsense.
Calling all PIs. Hold or buy. No selling at a loss at these levels. At least not until after the trading update.
Ignore the constant drone of doomery. These posters want your shares so they can increase their own profits. Dont give them away. Hold onto them like they are gold.
Be greedy when others are fearful. - Warren Buffet
Restating from my post yesterday, nobody should be selling for a loss at these levels. The fact that there are so many doom mongers posting here is proof that the shorts want you to sell rather than forcing them to increase their exposure to push prices down. If the company is finished they would not be here in their hoards screaming it's finished. Make them work hard for their gains and extend their exposure. Buy and hold until the 20th. Top up if you want a lower average. I noticed hedging seems to suspended. The move from 80 to 20 has already baked in a 75% loss of shareholder value. That's a massive dilution already and then there is also the re rate that should follow after the balance sheet improves. Its not 50 50 from here in my opinion. Upside case is far more compelling, but don't overextend. Invest only what you can afford to lose.
And report Astaris Capital here for possible insider trading. The more people report, the better the chance we get some action.
https://www.fca.org.uk/market-abuse-reporting-form
Happy investing and good luck.