Am I surprised by today's action??? You bet I am! I was betting heavily that we would see between 25% - 30% sustained rally today based on past historicals, the December 15 extension (as I saw it, not the media), the 'shoe-it-in' May 30th milestone, the advanced negotiations for the America Fund, the stream-lining of the business complexities, and the additional up to $155 million additional capex to fund the extensions, Advisors and Legals for a margin at what has to be close to the cost of that capital.
So ... what did I miss???
1. Bad news sells media! What I saw as a December extension that would be a walk in the park, the media widely reported as a May 30th extension Eg; "Beleaguered Centro gets another breather"
2. The investors that hold CNP scrip have probably made little change to their portfolios today as they are a longer term investor. The shares were held by a lot of 'speculators' (I am an investor; however I have traded Centro a few times). It is the many 'speculators' who were always going to sell out today and take a profit. I do not have a problem with this as it is the nature of the game! Theoretically the traders & 'speculators' were to be replaced by the bigger boys, Funds, and longer term more risk adverse investors, and the traders buying back in imo - but it quite simply didn't happen that way today!
3. From what I understand the May 30th deadline (which really has nothing to do with Centro, but is an inter-Bank way of a communication and consent plan) is a stumbling point that spooked investors. Not being an investment banker I do not really understand what the problem is here; so do we simply stay in limbo for the next 3 weeks??? Wait for the stream-lined Business model to appear??? Or wait for more information on the probable sale of the America Fund???
4. There could be a little bit of 'buyer remorse' sentiment around from the lenders who were bustled & beaten into the inevitable agreement. Maybe it is this sentiment that spread through the investment Companies and threw a wet blanket on the sp. It's kind of like buying something where you think you have paid too much for it & you're not really sure if you even really like it or not; but then you fall in love and get very comfortable with it after a few short days/weeks.
5. Is the stock being capped or manipulated??? Maybe, but I haven't seen any evidence. All on a day where the market is up 50 points atm. So, where are the traders??? Maybe they are all over at the 'flavour of the day' stock - Maximus Resources (MXR) - who had an exceptionally good announcement out after opening this morning, currently up 110% and has turned over ~80m shares today.
6. So what do I see happening next week (like I really know, lol)??? Well - I see CNP consolidating; I see people getting comfortable with the deal and understanding the milestones; and a gradual improvement up to the May 30 deadline and then hopefully a 20% - 30% sp improvement on subsequent deadlines/property or fund sales/milestones.
Personally I am looking for the 'dumbing down' of the Business model and the hedging book, so even a blonde girl like me can understand it (lol); oh, and of course the word 'dividend'!
I would like to hear some other (sensible/reasoned) analysis as to why others think the sp didn't fire today!!!
Cheers, Pie :-)
- Forums
- ASX - By Stock
- CNP
- cnp analysis...
cnp analysis...
-
- There are more pages in this discussion • 14 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)
Featured News
Add CNP (ASX) to my watchlist
Currently unlisted public company.
The Watchlist
I88
INFINI RESOURCES LIMITED
Charles Armstrong, CEO & Managing Director
Charles Armstrong
CEO & Managing Director
SPONSORED BY The Market Online