Gordon Stein, CFO of CleanTech Lithium, explains why CTL acquired the 23 Laguna Verde licenses. Watch the video here.
Yeah it's pretty tough to watch.
My best explanation is that in the current market, merely the promise of an impending turnaround isn't enough. Investors are so cagey (and interest rates are so high) that only actual profits _today_ are worth investing in (and, ideally, dividends).
So it's just a waiting game. Either we wait until MANO publishes some profits or announces a divi (unfortunately another 6 months minimum), or until the market changes mood (who knows!). But the fundamentals are still there.
Thanks Oldboy, appreciate it!
Also worth pointing out that most of their US revenue is currently CPA (according to their own reports), so all the growth & progress we’ve seen so far is based on CPA, and it hasn’t been to shabby!
Haven’t seen it mentioned on this board, but it seems clear that the recent price movements are due to the decision by New York State to ban revenue sharing deals for sports book marketing. Massachusetts has done something similar.
I’m trying to gauge exactly how bad this is for XLM. They clearly state in their recent report that they are looking to make revenue sharing deals “where possible”, and these types of deals definitely lead to more revenue over the long term, albeit less predictable.
I have also read come commentary suggesting that ultimately it doesn’t make all that much difference - marketers will simply charge a higher CPA and claw back any losses from not sharing revenue long-term.
Does anyone have any affiliate marketing experience? Can you shed some light on this?
Yeah this feels like a massively positive update.
The appeal not going our way is a shame, of course, but it's the nature of the beast and to be expected. Credit to MANO for publishing the TU the day after the judgement - presumably they were waiting on that to give the update. And at least the uncertainty is over.
Truck cartel update - "materially correct" sounds slightly weasily to me, but it does imply a low upper bound on the amount by which the carrying value of those cases could be reduced. So really that removes another large chunk of uncertainty around MANO's prospects. Which is huge, actually.
BBL stuff - as they say still early days, but obviously everything reported here is very promising.
Pipeline - for me this is the big one. It wouldn't matter if MANO had won the appeal if their pipeline was still in tatters. But the extremely strong growth here is exactly what I needed to see. Very very positive!
Not sure what it's gonna take to get a true re-rating here - we may have to wait until an actual unadjusted profit, or reinstatement of dividends. But it's surely just a matter of time now, a lot of uncertainty has been removed!
I do agree… but on the other hand, the pandemic is well in the rear view mirror by now and there has been no concrete evidence of the expected uptick in business for Mano.
For me it all comes down to the next update. The narrative for a long time has been that the pandemic left a big backlog of zombie companies that would be insolvent if not for the government help, and I’m hoping (expecting!) to finally see some reflection of this in the numbers. If that doesn’t happen it may be time to reconsider.
Ah interesting, yes I'm sure this is why. And makes sense that XLM would be hit disproportionately hard because 1) it's relatively illiquid and 2) it has just reoriented itself around a US-based strategy.
Now, I hope this isn't overly optimistic, but my initial reaction is that this news isn't all that bad for XLM.
XLM's entire business model is basically affiliate marketing for betting sites. This means producing quality, relevant content that customers engage in, linking out to betting sites where appropriate. This content is NOT "predatory advertising". XLM is not an advertising agency producing these adverts and, if these adverts are banned, presumably XLM's approach would be _even more_ attractive to the betting sites as a way of funnelling in new customers.
I do get the other side of the argument too though - if advertising is banned then it's likely that the sports gambling industry as a whole will become worth less; the pie is smaller and XLM's piece of that pie shrinks correspondingly. But my hope is that this is too simplistic.
After multiple excited writeups over the last few months, scsw has implicitly downgraded XLM in the latest issue to a “speculative buy”, and averaging down in the “naps” portfolio.
I suspect this could be a driver for the price movement - I’ve noticed scsw can have a decent impact on small and illiquid shares before
So the theory is that people out there thought superbowl fever had driven the price up, and now it's over this is the best time to sell?
Plausible I suppose - would be a shame if it turned out that run up was more about this superbowl trade and less about the positive news flow!
Shame to see it back at these levels. Very low volumes I suppose.
A handful of sellers taking advantage of the bump up to 280?
Looking forward to the next update here. If there hasn’t been any sign of the Covid backlog making it’s way through the pipeline by then I may have to reconsider…
"Firstly any valuation on earnings is EBITDA"
Umm... this isn't true. P/E and P/EBITDA are two related but distinct ways of measuring value, and P/E is extremely widely reported. Which is exactly why I ended up looking at this share - my eye was caught by the low P/E.
But I do take your point that, in this case, the EBITDA wouldn't have been misleading in the same way the P/E was.
"Secondly please name me one company on this sector which isn’t valued purely on a revenue multiple."
Fair enough, and this tells me all I need to know about this sector! Good luck everyone, but this one isn't for me :-)
Wow, market really didn’t react the way you hoped!
I suspect it’s because of the underwhelming 30% increase in new cases. Given the narrative of pent up demand over the Covid regulation this was pretty disappointing.
Presumably a common situation for Mano is that a case is being brought against a director for illegally lining their own pockets while allowing their company to fail with unpaid debts - in which case the director DOES have money to pay!
Patience is key here - there are multiple steps and filters that happen before an insolvency lands on Manoletes plate - I.e. the insolvency going bad, signs of bad behavior appearing, Manolete investigating the case and deciding whether or not to take it on etc.
So while an increase in insolvencies should indeed lead directly to an increase in profitable business for Manolete, the lag may be many months, and the interims may be too soon for a sizeable difference.
Of course, part of the point of the market is to price in these future improvements, with some discount based on how far in the future & uncertainty. But Manolete seems to be somewhat forgotten, so that pricing isn’t happening.
So yes I believe this is a great price to buy, but we may have to wait until the next annual report to see the kind of results that would lead to real price movement.
My only fear is that by the time this happens the UK is in the middle of a nasty recession and equities are all in the toilet :-/
https://www.ft.com/content/5006e768-bf7e-4194-baa9-f8694bf547ab
Thanks Leo, that's very interesting.
The main risk is presumably that the supply chain problems affecting MPAC mean that FREYR looks elsewhere. But it's unclear to me whether any other provider will be in better shape.