Over many years some of my best wins have been betting against the shorts. Lynas was over 15% borrowed at 4c back 4-5 years ago (40c post consol) - It is now $9.
The sweetest gain of all was when JARE agreed to defer LYC interest payments and the stock rose 60% in a day thanks to shorts being "soiled". Was a wonderful experience, shared by many who still post on that stock.
There are no guarantees in investment markets. In 3 years we will know whether sub $20 was the opportunity of the decade or a value trap. Right now, none of us can be sure of which it is.
I am happy to put money where mouth is as an adult buyer. This is not a meme stock or dog coin. This is a diversified debt free, profitable business in whom the market has currently, rightly or wrongly, lost confidence in. It is not broken, not debt burdened, not lost its focus and not lost its key investment managers.
Lots of people on this forum criticize and cast swine, from the cheap "not held" seats, as if they were Stan Druckenmiller proteges. I expect most are investment hacks who just love to see tall poppy's fall. It is a very Aussie thing to do.
Meanwhile, the rest of the world goes on trying to do what they do, to the best of their ability, and dealing with the challenges each of must bear. HD included.
I neither praise nor condemn MFG for making a wrong call. After all, we are all human.
I understand the portfolio positioning, which is NOT altogether as defensive as many here suggest. Nevertheless, the free cash flow generated from the funds management business alone, should not be under estimated. Whether the investment banking/Mexican food activiites are smart or not, I don't know, but they are thrown in the MFG pot for free.
Having not owned a share above $25 this holding has caused me very little pain over the short time I have owned it. I get it, other may have ridden this down from $40 or $50 over an agonising period of over 12 months. Our individual investment experiences with MFG are not the same and this may partly explain some of the putrid sentiment levelled at management on the forum. That's just the way these things fall. Investing exposes us all to different pain points. For myself, the sentiment surrounding this stock is no different to the sentiment I have seen with my very best investments (REE, gold, nickel, copper, cobalt, uranium, mortgage broking, financial services, telecoms, biotechs and fintechs. Most of my portfolio in fact.
My bruises from buying beaten down stocks are gone, but I expect the gains will last for many generations after me. Maybe future generations will ridicule me for buying into Magellan. Or maybe not.
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