The recent news from the lending syndicate was pretty awesome in all the circumstances: pin not pulled, relatively small dilution for now, and some more time. Well deserving a nice big bounce, from low base, compared to the "likely" expectation of massive dilution almost wiping out equity.
But make no mistake this is still an absolute dog of a stock for all the reasons I have posted before, and will take a minor miracle to turn around into a long term survival uptrend, including:
- cash negative last year / maybe borderline now / but what next?
- dynamic against staff and client retention/attraction, especially the best, in AU - given all the bad news
- almost certain morale and productivity issues / reputation tattered in legal circles
- crushing debt levels
- discredited management
- UK is a mess, should never have been bought
- NIHL portfolio is rubbish
The current EV allowing for debt is close to a $1b. That's a very big number for something in this situation. The damage has been done.
It's a high risk bet for longs that something will suddenly go right, like it did with the latest news from a low base of expectation, or that it will just eke out gradual survival.
I would not recommend this bet at all, though there's of course a chance it might pay. I'm out of any position, so stating as dispassionate observer seeing my name mentioned.
