MakThank you for your considered reply to my post. You are quite...

Mak

Thank you for your considered reply to my post. You are quite correct in highlighting my ongoing concern that the valuation of OBJ is running ahead of any calculable MC. You must recognise, however, that my comment on 26/3 was a full month before the PDA was announced and therefore (in my mind) fully justified. I agree that speculative stocks often display "promising" characteristics and the trick is to get in early and assess "potential". However, I can not agree that the market is the best indicator and so I am not concerned that, as you say, "the market in general does not agree with you {me}" regarding my assessment that the MC is not justified. After all, later on the same paragraph you state that:

" But what I do know is that I have seen many companies with arguably a lot less potential than OBJ and at a far less advanced stage than OBJ on much higher marketcaps than OBJ is currently."

So, is the market right to value those companies with a higher MC than OBJ as being more valuable than OBJ? Of course not - the "market" often gets it wrong. Without any fundamentals to draw upon it is all a matter of perspective and risk analysis. On the other hand, there are companies with very low MCs that have profits, good prospects and great management that the market has overlooked. So, I do not care if the market agrees with me or not. On the contrary I believe it is important to constantly critically analyse market valuations. Isn't that how we make our money? As you quite rightly say, "It's all about evaluating the risk versus reward."

The point I was making in my post is that many companies with great potential have, in the past, been overvalued on unrealistic expectations. The result being that once the true situation has been clarified through official announcements (not speculative hype) then the SP (and MC) has subsequently reflected the valuation of the company more realistically (although, as already stated, the "market" doesn't always get it right). Hopefully OBJ is not in this category.

I feel it is perfectly acceptable for me, as a holder (or even if I wasn't a holder), to question whether the future prospects of the company have not already, to some degree, been factored in, given the current MC, just as some posters claim that the SP will rise to 50c (or a Market Capitalisation of $750 Million). It is a debate that has some value for current and prospective holders alike.