You’ve been here a long time, rock, like me. I suspect whoever holds a good amount of 10c ex options (expiring 2026) is dumping their heads now over the inherent uncertainty caused by a combination of:
- the approaching wind down in operations over the Northern winter,
- the nonappearance of highly anticipated assays at what was a critical juncture (the period leading up to 20c options expiry, when they could’ve made an impact had they been good and timely results),
- a return, arguably, to the unreliable timelines (recall the West Desert maiden JORC!) and information vacuums we experienced early days with this stock (the true OGs will remember),
- management’s track record of giving nods & winks and signals that fail to materialize (ditto),
- a growing sense by some that retail is being played with (bolstered by some of the social media posting that is going on here lately, examples of which sound very much like IR “nothing to see here” talking points to me),
- what I believe are low levels of trust by the market operator after (imo) AW1 pulling one too many prior swifties,
- the potential for a dilutive event coming in the weeks or months ahead at below the current SP level, with retail always the last to know,
- the size of the rebound & re-rate now required.
My view of today’s price action is therefore pretty similar to what Bunn posted earlier.
This selldown would seem to me like good risk management, albeit out of somewhat unpleasant necessity. The unquoted 10c options were all issued for free, nobody loses anything on those if the share price sinks further, and these still have a couple of years left to ex so a higher chance they will eventually get back into the money, giving holders a golden ticket to ride. Heads, on the other hand, could easily run lower now that we’ve shockingly dipped back into single digit cents today and if a raising is in the mix. Longs who bought in below tonight’s share price and held on tight have not been rewarded for their loyalty, so the negative sentiment is both understandable and warranted.
Incidentally, the person who converted (early) 500K of those 10c options last week, while we were still trading at 13c and above, certainly read it right. It’s over to management now to try to shore things up with actions as opposed to more hollow words and helping hands for hedgies, brokers and bookrunners.
(20min delay)