has this bottomed yet?, page-4

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79 Posts.

13/12/16

13:56

Post #: 21301292
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Originally posted by MarkieMills ↑

My thoughts for what they are worth - I shorted the bounce - I wouldn't pay more than what the underwriters appear willing to pay, which is $2.02 - after accounting for their fees.

Well considering the insts didn't really want to take up the crap raise, as demonstrated by 47% being left to the retail issue, I would say it hasn't bottomed yet. Normally you would get 80% ish in the inst issue. With two shareholders making up 11% being required to take up their issue or the underwriter bails, it doesn't sound like the underwriter is confident in their numbers.

New Good News IMO:
1. a new Chair with a "hard nosed" reputation
2. Time has been bought and a margin of safety on covenants due to the extra cash.

New Bad News/red flags (IMO):
1. Huge allocation to the retail issue
2. Recent acquisitions underperforming - at AGM it was that they are seeking organic growth , now the reason is out - because they are unable to do/embed acquisitions successfully.
3. Occupancy metrics in decline from 93.1% at AGM to 92.8% at Crap Raise.
4. Div cancelled (for many this is bad)
5. Underwriters requiring unusual conditions to even underwrite at $2.10 - at 17% discount to TERP with the new funds.

Expand

Instos took up 93% of their entitlements

The allocation to retail reflects the register split, not institutional take up

EHE Price at posting: $2.45 Sentiment: Hold Disclosure: Not Held
1 Upvote

0 Great analysis

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has this bottomed yet?, page-4

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