WAF valuation, page-193

Wow, you sounded so much more rational at the beginning. 

I'm not apologising for anyone, thought I was pretty clear and logical, and why would I not turn up after the share price hits screaming buy?. I'm an unashamed bargain hunter as volunteered. Share prices are like sharks, they can never stay still but have to keep moving. Fear and greed, momentum, profits and losses are how most people view the stock market. Like I said, you can't take things too personally or watch day to day prices and see plots in every shadow. The market is a great game where everybody is trying to win by hook or by crook and more often than not it is the long term passive holders who see profits rise then fall and end up with nothing to show for the ride.

Sure, there may be a predator selling the price down for an eventual cheap takeover or the explanation may be much simpler. For years now the market has twigged that companies cum capital raise will issue a lot of stock at a discount to sophisticates and then throw an SPP bone to the long suffering. The share price invariably walks down to the placement price as enough people arbitrage the SPP discount or simply the underwriters who pick up the shortfall, pocket 6% underwriting fees just sell out to move on. This pattern becomes a self fulfilling prophecy as shareholders big or small look to take profits or average down knowing the share price will drop into a discounted raising. Given it is self fulfilling the larger sharks short aggressively or sell down knowing they can refill for a tidy profit from the forthcoming placement. Management don;t like it one bit but the pressure to refill the coffers given ever present market uncertainty and a relentless quarterly spend forces them to play into the traders hands. I'm sure this is nothing new to anybody reading.

Call it manipulation if you like, I call it reality of the stock market. Happens in juniors, happens in mid-caps and happens in blue chips when there is a sniff of desperation and cash flow squeeze in the air. The need to raise capital is a green light to sell down aggressively and pray tell, who wants to stand in front of that train? WAF had to raise a large chunk of capital as their equity part of a mine development finance package. I knew it, everybody knew it and so I stood back and didn't buy while the savvy sold down to re-stock from the raise price. I see it every week, time and again, the long suffering holders hate it, grizzle about it, but what do you do? I chose to buy low and sell high and IMO this last finance raise looked a damn fine discount. Sure, as some on this thread would say "2 years of no action equals a falling share price" and to some extent they are correct and I have gone too early. However, if selling into a cap raise has been hard enough and the discount steep enough, knowing it may be the last raise, I am happy to not get too cute and wait until the last minute. What did Confucius say "he who tries to pick the market bottom get smelly fingers". Great value will do me with the chance of a takeover balancing the 2 year build boredom.

You, the guy with the spreadsheet whoever he is, and everybody else who bought since mid 2017 may have sour grapes but don't get paranoid on me. I'm not trying to sooth anyone's pain, I'm simply rationalising my own decision to buy a fallen angel and happy to share my research and belief then have it challenged to see if I've missed any fatal flaws. I will sell WAF and not look back without a seconds thought if the facts change for the worse, I always try to stay objective. Stocks are a mistress, sometimes a one night stand, never a marriage.

Cheers