AFF Member Stock Discussion

[Happy Dude]

So the dip in the listed share price is related to the placement offer (presumably to existing shareholders)?

 

[cove]

It was a sophisticated investor placement thru Euroz Hartleys who we use.
We have WAF shares in other accounts.

 

[Mr_Orange]

Booktopia now in administration.

That's not overly surprising:



To misquote Yazz, "the only way is down".

 

[drron]

So the dip in the listed share price is related to the placement offer (presumably to existing shareholders)?

In the world of gold miners and explorers there really doesn’t have to be any reason for a share price to fall or rise. One of my miners has done both in the last 2 weeks even though nothing had changed.

 

[Happy Dude]

If I'd only been a little patient......

Hot off the press.

Last week, and several occasions prior, it was in the best performer list in CommSec's weekly wrap, and it'd been touted widely. I also think it looks good, even at last weeks price.

West African Resources shares dive after discounted placement - Capital Brief

https://stocks.apple.com/AQgcqvrIMSeeokk8vAAvebA

 

[Mr_Orange]

shares dive after discounted placement

This is fairly normal behaviour for any stock but is probably amplified in a lower priced stock.

 

[Happy Dude]

This is fairly normal behaviour for any stock but is probably amplified in a lower priced stock.

Yeah it is interesting how the market sees going cap in hand, especially when not in obvious financial strife.

 

[Brissy1]

So the dip in the listed share price is related to the placement offer (presumably to existing shareholders)?

Placement represented about 10% of previously outstanding shares.
So your shareholding now represents 10% less of the company than previously although you own the same number of shares.
But if the shares issued increased the value of the company by 10% (which they didn't because they were issued at a 13% discount), then the price shouldn't change.
So, the theoretical drop should have been about 1.3%

That it wasn't I think is because (rightly or wrongly) the market thinks/presumes/acknowledges that those putting up $M150 have a good idea of the accurate value of the company and that becomes the new BUY price, short-term (longer-term the market puts a "value" +/- to the company of the funding).

Just what I've noticed over the last 50years for institutional placements (but different behaviour when placement open to all existing shareholders)

 

[RooFlyer]

In the world of gold miners and explorers there really doesn’t have to be any reason for a share price to fall or rise. One of my miners has done both in the last 2 weeks even though nothing had changed.

Nothing's changed that you know about.

But if the shares issued increased the value of the company by 10% (which they didn't because they were issued at a 13% discount), then the price shouldn't change.
So, the theoretical drop should have been about 1.3%

That it wasn't I think is because (rightly or wrongly) the market thinks/presumes/acknowledges that those putting up $M150 have a good idea of the accurate value of the company and that becomes the new BUY price, short-term (longer-term the market puts a "value" +/- to the company of the funding).

Yes. There is the numerical discount, then the bearish sentiment brought about by the market seeing that the company had to offer what is a pretty hefty discount to get the funds in.

 

[Happy Dude]

WAF bounced today, resuming the anticipated trajectory.

 

[cove]

Settlement for the WAF placement is next week. Because it is African based the stock trades at about half the price earnings of Australian gold producers.

 

[drron]

Though the share I was talking about had just announced an increase in the gold production and the price of gold hadn’t changed but down they went. Since I posted they now have gone up by twice the fall.