I agree here, the US would no doubt be a strong long term opportunity and whilst the gap with the US uncertainty could in fact be a great entry point, it all comes down to where the company is in the cycle of its growth. I feel stretching too thin is a more indication of where the US would take the business. It needs to consolidate, improve fundamentals, focus on the low lying fruit in the Aussie market and especially W.A then in baby steps expand. It felt like a giant ambitious leap when it could either make or break the company. At the stage where the current business sits, they are better off sorting the board issues out, capitalizing on existing acquisitions and actually putting the TURN in Turnaround, then in a better position look at the US expansion concept.
It will burn a lot of cash, when we can still tap US markets until an inflection point is reached and it warrants the expansion. Right now it feels like a "Problem looking for a solution" rather than the solution to a problem, i.e. the US market is booming so much it absolutely needs a set up there.
LBL Price at posting:
38.0¢ Sentiment: Hold Disclosure: Held
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