Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
A somewhat naive comment. The issue is not about stocks rising and falling - I've been investing since 1970's so I've seen all that - it's about the lack of PR and therefore visibility in ALGW. The company needs to send out a clear message about what it does, how it hopes to achieve it, how AUM is growing, what its projections are going forward. To do this it needs an effective PR agency and some clearly written RNS's - is that asking too much?
I must say that I cannot get very excited by today's price rise. I've been holding for some time and have seen countless rises followed by falls, and we are pretty far down at the moment. I believe in the company and its potential, but the PR and communications are dreadful. We were told about a massive loan which was going to be forthcoming over a year ago, but then told that it was held up by Covid which was blatant nonsense. I'm involved in property and loans are hardly ever done or even signed face-to-face these days. The company is incapable of producing coherent RNS statements and the management seem to think that there is no need to advertise the company. I know that the management has experience in its area of expertise, but none in PR, shareholder communication nor in company promotion.
Maybe Giles, our resident poster who has a notifiable stake in ALGW, should use his influence to get the company to take on a good PR company to help them get things moving.
I reckon we are going to remain within a 5-6p band for some time to come. The shares were pushed by speculative buying to 8p but those punters have cleared off. We should remember that after the last market update in the autumn ITX shares fell because everyone was getting too optimistic. We need patience because it takes time to turn a struggling business round. When the year end figures come out they will look respectable but they will not cause a massive revaluation. What we know is that the products are being taken up by more and more companies, that the factory is running a night shift which is significant, that they focussing on wider sales having appointed a new sales director. In the long term, say 2-3 years, this will fly, but as always with turnaround situations we are going to need patience. Will we get back to 8p by the year end? Maybe, but not certain. An announcement of a deal with a major like Unilever would certainly do the trick!
There seem to have been a couple of largish trades this morning - two sales of over 500,000, but on the whole the trades have been pretty small. I cannot see any signs of any big buys this afternoon. It would be good if we did have some institutional interest, but none as yet.
My reading is that the company wanted to dampen down the speculation and rather frothy share price with a fairly bland statement that the results are sound and slightly above market forecasts. They couldn't issue actual figures, I reckon, because they have not been audited and probably are not even complete. I cannot see any evidence that they are lining up an agreed bid. If they wanted to do that they would wait until the figures are really spectacular which will be a year or two off, in my view.
Dickie, You suggest that the sp could be .85p on return. That is up 60% on suspension. Suspension MCAP was £160 million . If you are right the MCAP on return would be £250 million. This defies all logic. I'm not a holder but have looked at SYME a couple of times, but have always been put off by its absurd MCAP
I would never give advice on specific shares, but I can maybe suggest what you need to consider. I look very carefully at the market cap of any company. Some companies are valued at hundreds of million while others languish at under £20 million or less. This is not always justified by sales or future potential. The stock market is a very irrational machine not necessarily based on actual figures. I first noticed ITX because I was interested in the concept of eliminating phosphates from household and industrial products. ITX seemed to be doing that, its sales were increasing fast and its market cap was tiny. So I bought a fairly large holding at an average of 1.7p. It is still very lowly valued at £33 million and is still a micro-cap share. The potential is there especially if detergents are eventually banned. Much will depend on the sales figures for 2020 and news of new contracts. But they seem to be getting their products used by many companies and we should hear of new contracts in the next report due in February. So I'm not top slicing yet.
Good luck!
Good comment Giles. I am often amazed by large rises and falls in small marketcap shares and before either despairing or rejoicing, I always check out the trades involved. Often a 5-10% rise or fall can be triggered by a tiny number of trades of minimal value. So it's all a matter of MMs tempting punters in and out of the shares. After all a steady share price means no profit!
It's worth remembering that in 2012 when Itaconix was re-listed it issued 25 million shares adding to the existing 28 million shares making a total of 53 million shares at the launch price of 100p so the marketcap was £53,000,000. The company has come a long way since then, and still is only valued at just over £10 million, so there is huge potential here.
I had a run in with TW over Brexit some years back. I found his obsession with Brexit illogical and badly thought through, so I have dismissed him and his views on shares and no longer read what he writes. While it's annoying to have him de-ramping
VDTK it can only do temporary harm to the sp. I suspect that the management ignore him as they would an annoying fly.
Let's just hope that the forthcoming RNS has some really positive info because if it's vague and non-specific the shares will take a tumble. We've already had a couple of spikes followed by quite large falls as a result of a vague RNS. We need some concrete facts and actual proposals to keep the sp moving upwards.
It's been a long haul, but things are really looking much better. The marketcap is way too low for RUA's potential so plenty of scope for a significant re-rating of the shares when the market finally settles down.
Once again an investment with Jim Mellon turns to dust. His only interest is himself and has no regard for other shareholders. I was stung with his FastForward Innovations - do you remember that? - an investment company he launched then disappeared off leaving shareholders with a loss and rag-bag of fairly useless investments. He really is one of the worst - all talk and great predictions but ultimately no profits for his shareholders.
I wouldn't read too much into today's 10% rise. The shares are quite volatile and a few buys can push the price up sharply (and vice versa). There was a flurry of sustained interest last month which saw the shares over 1p, but that has died down. It's a waiting game, not so much for the completion of the present projects, but for news on a university project. It should happen one day - but when?
I've been in DKE for some years building a reasonable sized stake and seeing the sp fluctuate between .35p and 1p before falling back. This is the first time it has sustained a rise over 1p and this could be the turning point. The business model has been tested with the two current projects and they are now moving towards larger more ambitious projects with a couple of universities. The idea of building care homes/retirement homes on university campus is fascinating. It gives the universities the opportunity of training nurses, carers and doctors on site while boosting much needed income. It also makes good us of unused space. For the clients the advantage is that they have access to outstanding quality of attention. The present crisis if anything reinforces the validity of the model - safe income for the universities and a safer environment for the clients.
DKE has been the brainchild of Geoffrey Dart but now needs more staff and specialists to take the concept forward. That was addressed in the last RNS along with the share placing. The company is still run on a shoestring with minimal overheads and will remain lean with most services outsourced.
At present the market cap is between £3 and £4 million which is justifiable from the two current projects alone, and does not take in the university potential. It would only need one agreement to be signed to boost the sp and would probably lead to further agreements.
In a very edgy market, DKE stands out as a relatively safe investment with enormous potential.