RE: 30%9 Aug 2023 20:53
To give you an example from my own personal experience:
Back in the summer of 2020 I went and bought Cineworld share at 88p for it to begin dropping slowly but surely as the lockdowns took their turns to be rolled nationwide and hit everyone and everything that was a business that relied on large customer footfalls.
As I though Cine shares had hit their lowest when it reached 65p, I went big to average my 88p entry only for it to continue down whilst the hedge funds kept increasing their shorts to a point that Cineworld had the largest bets placed against it. Then by the 5th October 2020, Cine touched 15p before it rebounded slowly all the way to £1.22 by that 19th march 2021. I had decided to endure from 88p to 15p and then climb back up to my get out of £1.20 knowing that there will be no more to go. And so I was right, it slowly descended all the way to last month to less than half a penny where all pi shareholders ended been wiped out for good.
Notwithstanding over 10% of shorts bets placed against it by the time he reached 15p and all the media negative news coverage stating tha cine was going to go bust as no cash was available, by the following day before it was to fold it got a huge lifeline from its biggest lenders which are those that today are still backing cine albeit after taking big losses. During those times, I was very upset and feared being wiped out as I had over £40k invested and was down to the last £10k and looking a very red paper loss, but held tight and indeed did prey to save me from despair.
The story behind Cine was a sad one, but they were riddle with massive debts and trading at a loss for a longtime. The reasons that kept going for so long was because it generated a large turnover of cash, but it was a well busted business that overstretched itself by wanting to be the biggest in the business.
Capita is now a business that has dealt with its debt problem something that Cine couldn't have done as it leased most of their cine units after taking over Regal Cinemas. So, they had very little assets to dispose and raise cash. This is where Capita has done what was a massive task to overcome that hanging debt. However,one must ask themself how many of those highly valuable assets are still held by Capita if they were needing to raise more cash? I personally don't know and at this moment I would hope they have a few billions worth of those assets.
We're Capita. A totally different and very secretive kind of business entity that has left still today many confused about how they post their financial data. As it stands, I'm not worried. I've got more money to put in if and when I feel it's needed. I've got to be careful not go all in for the time being and that's being prudent due to the recent shocking events. However, I'm very temped to do an all in and wait it out. It can't be worse than what Capita was before. Please do remember that many here saw value at 37 and even at 42. So, now that is nearing 19
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