Great post wachito. We know for a fact that emotions drive stock prices. It's a herd mentality. Many things combined to smash BBI down to 2.4c. They have been discussed before. I will say that even some of the normally unemotional investors, including the ABN analyst, really got "scared" if I can call it that. If you read his reports for the last 12 months and then read his last report when he said SELL, you will understand. It was just him feeling guttered, spent and the white flag went up. He wrote about every possible negative scenario and his onlt hint of positivity came with his last disclosure.
He said: "Given the significant drop in security price this year we understand why unit holders would be reluctant to sell now. Ultimately the investment recommendation depends on an individuals circumstance (risk profile, investment strategy etc). For those looking for an income yield then obviously look elsewhere e.g. SPN. For those who are looking for an undervalued asset play then they may indeed want to hold or even buy BBI, but make sure they are aware of the risks, particularly the short term funding risks and the fact that surprises are more common in the current market. The critical period would appear to be between now and March next year. If BBI can survive that period with no adverse impact to existing cashflow, and finance market liquidity shows signs of improvement then the gap between BBI's equity value and underlying asset value may close."
So amongst all the doom and gloom, even the analyst who said SELL included a scenario which painted the opposite picture to what 95% of his report indicated. A bit of an each-way bet if you like. It clearly showed he was being very emotional in his reasons for negativity. After all, he is only human.
BBI Price at posting:
7.5¢ Sentiment: LT Buy Disclosure: Held
