Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Both Cardinal 3 and NigeCo make a number of very important points. It is especially good to hear that SMS replied promptly to an e-mail and claims to be in good health. That news offers some comfort. We must now await results, of course, but before we can expect the big boys to swoop en masse upon these shares even at this bargain basement price, profit has to be reasonably imminent, else they will try to seek more immediate returns elsewhere. But it does not follow that S4 is a dog. I believe that for the committed LTH (as I am) it offers great prospects. My expectation is that in a few years' time this share will be worth several times its current price.
What news has there been which would explain the rather dramatic fall in the SP? I am only aware of one hiccup in that there was mention a few weeks ago of the partial loss of one account. Further, I am not aware that any of the directors is selling up. I suspect there is quite serious market manipulation in play here, and that those involved are hopeful of making a colossal killing when the results are published.
NigeCo, I think it highly likely that you are correct. If I know SMS, he will still be leading the chase in pursuit of whoppers because he knows that at the end of the day others will be chasing big clients too. He is not going to slacken his pace and give his old nemesis, WPP, a chance to thumb their noses at him. I would not be surprised to learn of new whoppers and decent results on the 29th. But if you want a chance of making a killing too, then buy in if this SP falls further next week. I have other irons in the fire too, of course, but I share your optimism, NigeCo, and sense that the coming days may be a good time to buy in.
With respect, Phrontist, I do not agree. Many companies take years to get off the ground but ultimately become successful. I see no sign that S4 is going backwards. Rather I view the present state of affairs as slow but steady consolidation. If SMS secures his targetted "whoppers" in the next year or two, then the SP should rocket and some big boys moght start to sniff around the acquisition trail, but whether SMS would even sell then is a doubtful propositoin IMHO. He's out to show WPP that they were mad to get rid of him.
Should SMS leave hospital and, rather triumphantly, presents a decent set of FY results, it might be a different picture.
There are many possible, simple reasons for SMS's surgery - e.g. appendix, gall-bladder removal, hiatus hernia, all of which might be described as "minimally invasive." No good reason to suppose this is serious or to prepare his obituary.
Well said, ManU31 !
Market manipulation will always be with us, I'm afraid, and we honest investors will, from time to time, lose out because of such activity. It goes with the territory.
I think we shoukd recollect that SMS indicated that Q's 3 & 4 constituted the period when S4 did best, so I am not sure I expect even good upcoming results to lift the share price enormously.
I don't think that even good results will assuage the market just now. There is no immediate prospect of a divi, and past performance is no guarantee of future riches, given the unstable times in which we find ourselves. This share is not flying and is predicted to be producing little in the way of prospects for at least a year, so why, as a fund manager, would you invest in it just now when there are plenty of bucks to be made elsewhere. Of course an upturn in the world economy will appear sometime - it always does - so each one of us has to assess our own position with regard to S4. The share is cheap if you believe, as I do, that it has a future. I don't need immediate success from it but am putting it away for our grandchildren who will probably not qualify for their OAP until they reach the age of 75.
Results for Q3 of 2022 were published on 14th November, a time-lag of about six weeks so maybe mid- Feby?
Is this just a case of a rising tide lifting all ships? I have no idea what is going on here, but as a LTH I remain confident about prospects. It does not seem to me that any of the directors are selling out.
I just don't think this share is going to do much until S4 starts paying divis. But I am equally sure that it will do so in time.
His article entitled "STOCK INVESTORS NEEDN'T LOSE SLEEP OVER RATES." is worth a read.
"Feral shorters"? I love it. Sounds like a race found in Tolkein. Do you think they inhabit Middle Earth, perhaps? Ha ha!
First there was concern over Metaverse and for now at least, Musk seems to be destabilising Twitter. A lot of ads are being pulled as a result, so there is uncertainty in the digital advertising world. I suspect the market is reflecting in part these developments even if there is market abuse at the moment. But it appears that there are no huge sells, unless I am missing something. I intend to keep adding as and when.....
Oddly, the FCA's website appears to carry no facility to complain about market manipulation of SP's via algorithms. You would think they would want to be onto this sort of thing right away. Anyway I have sent in a complaint but you would think the S4 Cap BoD's would be doing so too. Or am I being naive?
Just thinking, NigeCo et al - is there not a case for reporting this market abuse to the relevant authority? Seems a clear case to me given the info you have posted. Will ponder this further.
Perhaps my last post was a little too wordy. I ought to have given more emphasis to what I see as the main point. SMS, in that hackneyed phrase, is "getting on in years". As such, his case is an interesting one from the actuarial point of view. He is past the mean age of survival for males. You might say, well so are the Sage of Omaha and Charlie Munger. But sudden, unexpected deaths are not unknown among apparently healthy men of SMS's age. I suspect that risk is a factor which has been priced in by the market. But I choose to play what golfers call "the percentage shot" i.e. what stroke is going to land you on the green with least risk. SMS strikes me as having entirely undiminished cerebral function, so I will continue to take my chances with S4. Should the market continue to undervalue the share until a dividend is paid, well, so be it.
NigeCo, Pearls,
I must say that I too find it very difficult indeed to make sense of the market's muted reaction but I suppose we ought to take comfort from the fact that the SP now seems firmly rooted about £1 higher than it was only a few weeks ago when trust in this company had all but evaporated. Perhaps the market was hoping for a dividend and now doesn't quite have a clear idea of when to expect one. We all know that divis are not the be-all-and-end-all of investing, and that the buy-and-hold brigade recognise that truth too. At the end of the day we three (at least) are PI's and LTH's, confident in our outlook upon this share. We have adopted these standpoints because we foresee a longish term upward trend and because we tend to dismiss both undue market froth and exaggerated pessimism in our personal investment strategy. Let us pause and ask one question - what premium would a buyer of this company have to pay for it now? My own view is that SMS would never sell out, but if the Grim Reaper were to swing his scythe, would his heirs and successors do so? You bet they would, maybe ony at a premium of 50% to the current SP. I think these considerations are active limiting factors at this juncture. So let us hope that SMS remains in good health for another decade.
One of SMS's "whoppers", is close to announcing a deal with Tom Ford. Meanwhile, French stock market now worth more than British stock market - see Rober Peston tweet. Guess why....