Ann: Quarterly Activities/Appendix 5B Cash Flow Report, page-72

SFX may well be in a similar risk-reward situation as prior to the Qtrly confession, but that's not to say the share price was ever going to hold strong. Wasn't my place to upset some LT posters, but it's not surprising to see price retrace on low volumes. 51c was a recent CR support, once that broke 44c is the next support, hit this morning.

The situation is understandable. SFX has lots of LT believers/holders who are not inclined to sell before TB delivers on it's value promise, not at mid 50's as Bruce pointed out in webcast, so probably not below unless recent events is causing stress. Scarce buyers at mid 50's before may be encouraged to get set at lower prices given the risk-reward situation still seems fair, but existing holders are much more likely to be thinking risk management and reducing exposure not lifting it. Some holders have decided to take risk off the table at 50c and 'get their 51c CR money back' which is completely understandable... breakeven when bad news hits is a gift imo, 51c was unlikely to hold.

I'm sure many holders would be thinking they might like to have taken some risk off the table, but with a very illiquid stock only a few can get out into a thin bid. Larger holders would not even bother to try such is the thin bid and price fall required to fill large orders.... Hotel California for those guys as I once said. The big multi-million share seller that appeared late January is seen in a new light after Bruce told us Jan turned to sheet with OS abrasive damage to DMU seals and equipment. Zoom in on the chart and we can see the share price falling early Jan with the breakdowns and OS troubles, then down to 51c early Feb as the big seller sat on the ask and no doubt word of bad news percolated. Early March the seller found his buyers and the share price popped, maybe accompanied by repairs that rectified those issues and lifted production in through Feb into March?


A good example of how difficult getting out of a large position can be in an illiquid stock, how important timing is, and that sometimes sitting on the screen and daring bulls to take you out and get clean air for a share price rise is better than hitting the bid each day in small amounts and pushing the price, and your average, down with that action and fear constant selling can cause.

While current OS downgrade has pulled the rug out of confidence, causing buyers to thin even more and some sellers (who may have average cost in the teens to 20's depending on when their bought) to hedge their exposure against worse outcomes by reducing their holdings regardless of the lower price today. Prudent money management, but this sort of set-up does provide good opportunities for those lightly held or new buyers to pick up exposure at much lower entry levels. Won;t say bargain quite yet with the time and rectification risks being what they are...

GLTAH