The business is challenged on many fronts. It will take more than interest rate cuts to turn it around. Share price performance is reflecting markets concerns about Spark’s future prospects and recent performance trends. It is interesting to note that competitor One NZ has been able to maintain it’s EBIT, margins, and guidance under the same economic environment.
Many of the ‘drivers’ management have put in place to reset the business will take time. There is no quick fix. Largest shareholder Black Rock’s recent sell down (8.6% to 5.9%) is very telling on investor confidence.
Short positions continue unabated. Another 2.5 million shares shorted yesterday. Shorts are now at the same level they were two months ago and increasing. Whatever your view, it is clear that many are speculating on Management failing to deliver on their revised guidance.
Hopefully we get some positive news by February and shorters get squeezed.
SPK Price at posting:
$2.68 Sentiment: None Disclosure: Held
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