G'day all - Happy New Year. Dear James, thx for the 2 preceding posts. I agree with you, except I am more optimistic in terms of fundamentals. If BVSI can maintain [or even enhance] its margin, PSR below 1 is reserved for cos bleeding profits - and not so with this co. I am working it off my memory, which is getting worse and worse <g>, but I think telecom sector is about 5. And many do not have the kind of renewed growth rate like BVSI.
I may be a bit more conservative in terms of guestimating <g> the p/b though. Even though it may book a gain of 75c to $1 gain on the sale of asset, its asset base should be taken out of the existing book value [~6.25?] Still, p/b is only slighly above 1.
So, that leads to the recent decline in share price. You are right about some changes in IRS treatment against short-in-the-box [I've never short a stock in my life, so I may be off here <sg>] but if the big boys know that the share price is going to decline, they have a better position in shorting the stock against their block to book some short term profit. Unless there is a bigger shark out there, the chartists will end up paying for some of the Jan effects. This is only conjecture, however. And it is one of the more benign conjectures. Otherwise, looking at the recent poor technicals, one can only infer something is happening that we outsiders are yet to uncover. I mean, the only open negative about this co [psychologically] is the abrupt change at the top. And I don't see that change has any material impact to the recovering trend of the co.
best, Bosco |
