RE: Posts - back history23 Mar 2021 00:01
Crikey MB/Face! First thanks for the succinct resume of events surrounding ITM. However, almost spilt my tea when I read this:
"Certainly wiped £40k from my portfolio in the last 3 months. Such is life."
- Holey moley!
I'm running portfolios that are a combined total of 6 figures - but I've never invested that amount in any one single stock, let alone lost that much amount on one single stock. How did you get over it? Or does it still rankle?
(On second thoughts - don't answer; would be too painful to listen too :)
However, I was somewhat reassured by your evaluation of the whole shooting match with:
" I'm not going anywhere because the tea leaves are in this company's favour. Surplus cash flow, little COVID disruption, international partnerships, guaranteed work til at least 2025."
If that's your synopsis of where you stand, then no one can accuse you, of being in error (although I would ameliorate the cash flow point somewhat, as it's dependent on grants, is it not?)
Upon skimming through the posts back to late Jan just after the SP was punching through £7+ it was dismaying to read later on, as £7 became, 6, 5, and now £4, of posters lamenting they could take it no longer and were selling. What a terrible way to sell. No strategy. No plan - except for I-will-sell-only-when-I-can-no-longer-tolerate-the-pain-anymore.
I felt the same dismay throughout as poster after poster now bought on gut feelings alone because it now "felt" cheap.
Again , no strategy, just pure catch a falling knife syndrome. If anyone had a strategy or plan then I must have speed-read past it.
Of course that's easy for me to say, with the power of hindsight isn't?
There did seem to be some sellers realising long after buying, that they felt the SP was going to continue retracing so were selling up, and suggested ITM was somehow a lost cause, which appeared to cause some ill comment.
On paper yes the balance sheet trading accounts show huge losses and so the SP is overvalued based on 'current' metrics - but that's because it's trying to establish itself in a fledgling industry. The balance sheet should have been examined before purchasing - not afterwards.
So yes on paper they are right the company's SP is grossly overvalued (in fact the Discounted Cash flow method of valuation suggests only 58p as "fair value".
(For the sake of long term holders I will insert a - LOL! - here).
But the DCF method treats all stocks as companies with an established proven, profitable business. This is not the case with ITM. There is no profit currently. That will come in the future.
Time to shorten this post, so will end here as want to test one of my calcs against ITM for tomorrow's price action only - and post it so can measure myself - and be held to account if needed.
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