Well the shorts are really having a crack. From around 1% at the start of the year to 12% just a few days ago. Interesting they also had a go in 2018 but the share price crept up over that year.
I can see why they may be tempted, the company line over the past couple of years has seemingly been to increase the value of their fish in the water so what happens in a year where international prices have fallen back? Add in some execution risk on the prawns and they might think they can profit off some sort of downgrade.
But the late October update was pretty decent and they seem to be getting their prawns to market in time for the Christmas rush. Combined with the return of the restaurant trade there must be some possibility of a cashflow boost.
I can't say I'm supremely confident but I've just had another look at the AGM presentation and they still seemed cautiously optimistic. I wouldn't have thought the China situation would have a major impact since then.
Bottom line, I'm concerned when I see that level of shorting combined with a decent level of gearing and limited pricing power but if local pricing has held up (and I see no reason to say it hasn't) they may well deliver a very strong result including prawns as you say.
I hope so as I'd love to see the shorts get absolutely slaughtered.
TGR Price at posting:
$3.31 Sentiment: Hold Disclosure: Held
