Australia's largest stock trading and investment forum Australia's #1 stock forum

VXL valence industries limited

0.00%

11.5¢

What's going on with VXL?, page-5

First 5 Last

Share
Profile

Follow
m0ngy

10,075 Posts.

4852

23/02/15

14:11

Post #: 14802247
Share

Originally posted by JBaker12 ↑

Creating shareholder value is a matter of perspective. Since investing a year ago I’m up 87% so CD and the team have created lots of value for me. If anyone is stilling on a paper loss at current then that is more just bad luck with timing and doesn’t mean that no value has been created. Just because you buy a share and It doesn’t go up straight away, every day and forever doesn’t mean management are bad and don’t care for shareholders.

Management have largely achieved their stated goals, however they have done so at a much slower pace than what was stated at the IPO, whilst the timetable has continued to slide over time (a big impediment to a SP recovery).

As explained the last time you asked these questions, at the current SP the company is quite overvalued based on the expected production profile of PH1 for 2015. The market wants to know about the MOUs which underpin PH2 and funding (securing debt, there is a risk of an associated CR). The current share price is discounting the company being successful in these hurdles. Currently we are in a spot where the market is overpricing the current but undervaluing the future potential. Until these aforementioned hurdles are clarified (and done so in an appropriate time) the SP will continue to struggle as there is currently no reason for new investors to buy in.

As per company announcements, production and sales are expected to ramp up into full commercial mode after March. The ramp up phase is a cash burning process so until it is completed there is no sales and P&L data to report. We will no doubt get an update on progress in the March quarterly, however the first likely instance that we will get credible information on the sales and P&L of PH1 will be in the June quarterly as they should have been in a steady state production for almost a full quarter. Do you actually read anything the company publishes? Why should the SP have been smashed after the EGM last week? Does the fact you thought it should have been smashed but it wasn’t suggest that your view was wrong?

At the end of the day if you don’t think the company discloses enough, think the share price will fall, a CR is coming, the company won’t make profits because of the your omnipotent belief in Chinese Industry, why did you even buy in again? Given the points above and all the problems, which are negative for the outlook of the SP, why do you complain so much about the share price falling when this is what you are forecasting?

Expand

"at the current SP the company is quite overvalued based on the expected production profile of PH1 for 2015."

That makes sense, it's overvalued on the known fundamentals and the market isn't prepared to positively price in the future profitability because of debt, risk of credit raising and concerns about rising COP as Fish pointed out. That confirms my belief that management should communicate a lot more and be under pressure to do so.
And I guess that explains why the share price is down 32 % this year including a break down through the resistance level of 40c today. We are now very close to the share price of 12 months ago. My chart tells me 35c is the next target, perhaps 30c will be fair value given the risks.

VXL Price at posting: 38.0¢ Sentiment: Hold Disclosure: Held
3 Upvote

0 Great analysis

Reply

Top Stories

ASX Market Close: Trump tariffs paused til August; CBA falls below $300B

Trump chides Powell as Goldman call for calm. The RBA must be nervous

Listen: HotCopper Wire Podcast 016 – FY25 ended up not so bad... but Trump unpause is coming

AII

Inside the depths of Panasqueira: A legacy carved in rock

Monday's HotCopper trends: Northern Star forecast, AML3D Navy handshake | July 7

First 5 Last

Add to My Watchlist

What is My Watchlist?

A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.

SPONSORED BY