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For the price to fall, people should now sell. It can only happen two ways, shorts increasing or funds or PIs selling. Funds wont sell at this stage, most PIs wont sell, do shorts dare increase their position considering the rumour has some legs. Doubt it. They would be scrambling to close their positions on the contrary.
Everyday movements will make people make the wrong decisions as you will see the ups and downs of SP. It is an addiction that people can’t come out off quickly. Switch off your PCs and check once in a month and see how it performs.
City makes money by creating bubbles (both optimistic and pessimistic) and get people dragged into them. Agree long term investments win provided business where you invest delivers growth. Colliding with hedge funds who have more power and control in the markets when your house is not in order calls for further trouble.
Suspect there is 15-20% upside here in the medium to short term. This has fallen far too low and as expected touched £35 before the reversal. Results tomorrow hopefully will provide much needed confidence to the market and also on the divestment of iFood and Grub with focus positioned strictly on the European markets where they maintain their lead position.
Looks like a reversal is coming. Cat Rock had set a timeframe of end of this year for the management to take some action to prop up the share price and they think this is vulnerable to receive a low ball offer at this price, which JP Morgan also agrees with. Will hold for share price correction to come in the new year.
$7.3bn was the cost of purchase of Grubhub. You're right this is way lower than all of those values put together and is firmly in the bargain territory and so are many shares in the market right now. Im holding tight hoping things will change in the new year following the principles of value investing.
Not sure why this keeps dropping continually. It was valued at £20bn few months ago and less than £10bn now. This is crazy. Dont think the business model has changed so much in few weeks. Just goes to show that investors wanted to make a point and increase pressure on management to take action.
They rejected €2.3bn for their stake in ifood, they bought grubhub for $7.1bn, so there's a minimal value of about £7.5bn between them, leaving the rest of the business valued at about £4.5bn based on current prices. It is cheap at this rate and hence has attracted interest from Value investors like Seth Klarman and continued activism from Cat Rock on low valuation. At the current valuation, it must be a good takeover target for large companies like Amazon, Doordash, Meituan etc and get access to major player in Europe.