next few months will be worth it, page-2

Hi Twin,

I'm nearly as enthusiastic and optimistic as you with ADO, but I think we need to temper expectations a little. POC1 have been dragging their heels, these supertanker corporations are rarely moved to act quickly, especially when dealing with what they perceive to be a minnow. It's clear to us that they need to move quickly, and using M&G in their product does have an air of inevitability BUT the money men and corporates can be incredibly pig headed even in the face of damaging their business.

I think we'd all be disappointed if the Chinese IVD didn't eventuate before February, but beyond that I don't think there's any concrete evidence of deals in the pipeline. Of course I hope to be proven wrong, but uptake of M&G has been slow and the deals we already have equally slow in generating significant revenue. Even the BBI/Alere deal will take some time to show up in the bottom line. The believers (myself included) know/think it's only a matter of time before the enormous revenues start rolling in, but we're arguably better informed than even 'sector analysts' and brokers at this stage.

I'm hoping to see bigger, more professional money moving into ADO soon, but it doesn't seem to be happening yet given the lack of significant holder announcements so far. The silver lining to this, is that it gives us retailers time to consolidate and build positions and for the top 200 to control an ever bigger slice of the company. If/when instos/funds want to move into ADO we could conceivably have the top 200 holding north of 85% of the company, if the rest of the top 200 are anything like me there'll be very little motivation to sell any for quite some time - when big news does hit and the profitability is proven beyond doubt (i.e. the time that big fish start to bite) the price will have to rocket for anyone to achieve a new significant holding.

I hope that doesn't sound too negative, I agree that buying at these levels will very likely be highly profitable, I just think the time frame for big gains from here to be established and stabilised might be 4-6 months rather than 1-3. I'd hate for people to be buying in after a 200% price rise and expect continued vertical appreciation in SP, there may at some point be some aggressive tree shaking to dislodge new holders with unrealistic expectations ($4 by February!?), surely there have to be some dips on the way up - just too difficult to predict at what level they'll occur (even ds has been wrong footed after all).

All IMHO, and I'll be sticking to my 'no trading of ADO' rule and continue to wait for that dip to accumulate more!