For company that was at over $2 per share has an NTA of 95c and...

For company that was at over $2 per share has an NTA of 95c and a strong asset position as outlined in this and other threads, the only way is very significantly up, unless further problems emerge.

So as a potential buyer of this stock, these potential problems are my focus.

Some risks or negatives are:
1) Major, unexpected property writedowns taking the company close to covenant breach, or if not near a breach, significantly startles the market. Would have to be to a greater extent than already factored in.


2) Another VCS style default, which seems to cause huge over reactions.

3) Global meltdown worsens.

4) More instos exit.

No longer being in the ASX 200 is a negative in terms of getting the big money back in to the stock and while that is the case could prevent it seeing truly monumental gains. If it does re-enter then that may be a catalyst for a huge upsurge.

I've left out non payment of dividend because that won't be announced for some time.

On a risk reward basis, I feel that this is a very strong buy. I don't believe points 1 or 4 will happen and point 3 may have limited effect as bad news is starting to have less effect on the markets.

On a positive note, I feel that reits are beginning to recover and that interest rate reductions will siginificantly assist the process. As the current high yield reits recover, others are likely to be dragged up with them.

This is very quick assessment, I'd like to see others opinions of the potential short and medium term risks.