Just in case some of you are wondering as to this weeks weakness...

Just in case some of you are wondering as to this weeks weakness in the SP;
This is due to a report put out on Monday morning by Goldman Sachs re rating the small cap mining services in which they have had a buy rating on several companies one of which was Norfolk (also included IMD & SDM) They have moved to Neutral on these companies but maintain a positive outlook, and in particular Norfolk. They went on to say that they do not see any short term catalyst to move Norfolks SP. As a result of this NFK SP immediately dropped below $1.00 but on very low volumes and has continued to trade at very low volume. The current SP is totally reactive to to this one report which was not negative in any way except for GS moving to re rate this small cap sector. (ie not Norfolk specific)

I would like to point out that my scrutinising of the Top 20 Shareholders actually hold very close to 80% of Norfolk stock - not the 70.41% as per the latest Annual Report showed as some of those entries in the Top 20 have multiple entities which hold shares and sit below the 5% threshold.

Masfen Investments have also continued to buy up Norfolk stock and have now moved again recently on the cheaper price being on offer. Masfen is a value investor, not a trader and has a great track record at buying into great investments.

The Entities that dominate the Top 20 and indeed are substantial holders are all very aware of the Lower liquidity of Norfolks trading stock and the dividend is not at a level that would attract a Substantial owner to just sit back and reap a good income over time. $1.10 is about the right floor for this group that dominate the register.

The selling that is occurring currently is almost certainly the retail - small investor that follow GS and have taken fright with the sector re rating. Due to the more illiquid nature of NFK, It doesn't take much to exaggerate the SP to the downside on very low volume which does not have any conviction behind it.

The Top 20 Holders in NFK have all taken their positions with the full knowledge of Norfolks liquidity pattern of trading stock, and have been doing so right up to this week.

So what else has changed? nothing the company management have reiterated the "at least 10% growth in NPAT" which equates to 20% EBIT growth, (pretty good numbers) the Order Book and Pipeline opportunities are the strongest ever produced by Norfolk. The company revenue is across a large demographic and not held hostage to one market. The Rail industry is across all geographies and demographics and is expanding rapidly through out the world as a preferred mode of transportation for commuter and goods & services, so provides a very good outlook on what is Norfolk's most dominant revenue producer. (Rail now a Buffett favourite)

A previous Poster referred too - Haden's likely positive impact on the bottom line, to which I agree, and should not be underestimated as evidenced by recent contract wins through cross leveraging of the 3 Norfolk business units. This is part of the Norfolk strategy, with these recent contract wins combining the ODG & Haden business units is moving Haden into better Margin contracts and at the same time away from the less desirable commercial property margins that have affected it since 2009.

What does the future hold -

- "At least 10% NPAT growth"
-1.05 Bln Order book
-1.1 Bln Pipeline
-Contracts moving through the 50% progress mark and therefore being recognised as earnings.
-Haden's return to better margins and likely strong positive impact on NPAT.
- A very strong industry outlook for Rail and therefore ODG which are the leaders in this field with a strong moat type quality to ward off new entrants and as such are seen as a primary target for Takeover either by another Industry player wanting to expand revenues away from resources or a Private Equity company who are thirsty to put deals together.

-The Substantial Share Holders impact in particular Maui's Indigo Fund which are the number one shareholders and WILL be selling their holding in concert with several other substantial share holders (this is what they are all strategically manoeuvring into position for)
-Maui have had approaches (MND being the more public one) and Maui will sell as this is what their Indigo Fund's purpose is and its only way of returning investment (& its capital gains) to its investors. Maui's Indigo fund is fully invested and Norfolk is its most mature business on the Funds time cycle and as such Maui will be under pressure to realize profits and return cash back to its investors. Particularly since they have just recently launched and filled their new Aqua Fund which is very similar to Indigo. (and I would guess a lot of the Indigo investors have also bought into the new Aqua Fund)
Maui have retained the same cornerstone investor (I believe this is a Macquarie entity) which they are proud of. Macquarie have done a due diligence and satisfied themselves on all of Indigo's investment and valuations etc and have with confidence reinvested into the new fund. Point being they (Macquarie) will have a strong view toward Indigo returning cash to its investors.
Lastly I also remember Geoff Wilson (WAM Funds) on Switzer a couple of months ago saying that they have purchased Norfolk through a Fund that they operate that focuses/invests around special opportunity events that will impact and move a share price higher (Takeovers in this case) along with also mentioning IInet.

Obviously as a shareholder I am showing bias to my own investment, but I have tried very hard to stick to the facts as it does me no good (financially) to contribute one sided view points on any investment. There has only been one event recently that could be taken as negative and that is GS moving to neutral on NFK's rating whilst holding a positive outlook. You be the judge.