Hi @JayWin, i think ive seen you around some shares ive been in so i'll try to give you some insight into some of my thinking here, obviously i'm a bit more of a streetwise investor than a so called professional or qualified one so it's always hard for me to explain proper details etc, however i'll give you somethings maybe to think about or just shrug off, up to you.
VGI must have been short at 28+ and more likely 30+ as they were short before the gap down. No-one has won anything yet.
I was surprised to see MB have a winge and threaten to try a class-action against VGI and did write a post about it and another to give my opinion about how retail investors can benefit from reports like VGI has done here, i think for MB to jump on the front foot like they have/did so quickly leads my streetwise sense to think they are emotionally involved here somehow, CTD did also have ghost offices in their presentations without the explanations we have all now seen and they also had to remove some from their website, CTD also have stated for a while about patented software and some investors may have thought this software that no-one else has gives them an edge over competitors in the industry when that was all clearly BS. I'm actually surprised ASIC or whoever is mean't to discipline this company hasn't given them a massive fine or some sort of decent penalty for having such false info in their presentations and am surprised MB hasn't stuck up for having true and accurate presentations or is it we just can't believe presentations from companies, If management give out false info in presentations on their listed company how are these people even allowed to run a listed company, it doesn't make sense to me and it's just wrong.
The red flags are one thing and as an investor they would be enough for me to pull the pin as it all just creates elements of doubt and i was always taught - if in doubt, sell out.
I may not understand the travel business as well as some but i do understand business as a whole or i like to think i do. I do however imagine the travel industry would be quite competitive even in the corporate sector and if CTD can cut such materially higher margins than other competitors it's got to make you wonder how they do it. If butchers see some shop doing well they all try and see how they do it or what they are doing wrong in comparison and what makes that shop go much better, So therefore i also imagine that Travel industry businesses would be similar, they should be thinking how can CTD cut 30% and i'm only cutting 15%, i doubt very much they just twiddle their thumbs and just watch a competitor rake it in in comparison and do nothing, CTD also don't have patented software and from memory in VGI report they state what they use and i presume anyone can use the same or similar software for a fee or whatever, you can check their report for proper namage.
So this has logically got to make you think are these profit %'s real and if they are why isn't anyone else up to speed with this more profitable approach. Another thing to think of is how long can these guys keep doing this before it starts to get hit with similar margined competition, the gap in profit difference should surely spark some interest by some smart bloke/Girl surely?
So saying the above we all should know that companies are valued on a forward basis, future earnings ra, ra, ra, so apart from the 20 +flags someone like me will also think are these guys going to be abvle to continue these profits into the future, surely someone will see the money to be earn't and have a crack, theres also plenty of articles on tech disruption coming in the industry going back a year or two and i wonder how they are going and all these companies that CTD swallows up what makes them want to sell, why doesn't a competitor take them out or why don't they go for the big $ aswell.
So after much thinking and waiting i have gone short, i went short after i saw MS, MUFG rock up on the friday morning and to explain why i waited while still on here saying VGI are probably right is because of market pshyc or behaviour because after VGI let its report out there has been staunch opposition by CTD itself, MB, Insto's and people on HC etc so i was therefore expecting some sort of bounce and as time went on was expecting the intial emotional reaction to taper off while all the info sinks in, i find market behaviour is helpful in timing especially when i'm late to the party or another way of saying that is only fools rush in.
Limp's and Jean argument is how can all these insto's etc be wrong, well they might not be, time will tell, we all only have opinions so far but one thing you can ask yourself about these instos etc that they mention is how good is their DD, they didn't even know about the false patent advertising which means they never checked if CTD was telling the truth, they just took their word for it and these places manage millions of $, it's just an absolute joke with no attention to detail, thorough DD and people must be mad imo to have any money with these places as they obviously on the snooze. I was also taught to believe nothing i hear and only half i see.
Sometimes valuing companies is more than just crunching numbers, in-fact it all the time but one needs to be more than just a bean-counter in this game imo. Here is an article about a hedge fund that hasn't looked at financials for yonks and he goes alright to back up my views.
https://www.copyright link/brand/chanticleer/meet-dan-ariely-the-hedge-fund-star-who-never-looks-at-financials-20181117-h180n2
Fish.
(20min delay)