Simplistically 25% chance Leighton is worth nothing to shareholders (highly geared co, lawsuits could target 10% or so of international revenue over many years, reputational damage etc etc). 75% chance it is worth approximately what it was before - so my target might be about $14.60 over the next week or two. If we start to see lawsuits chasing compensation, and they look like the may be successful - I will quickly lower my target.
BTW - a cascade of effects could be set in motion by a falling SP. Highly geared Grupo ACS is possibly relying on dividends from LEI to maintain their interest, and to service debt, as they are highly geared. They could possibly be forced sellers in a bad shituation, or could be unable to take part in a significant capital raising. Their balance sheet will possibly be impaired by any reduction in LEI's SP.
Who knows what will unfold over time. DYOR - my ballpark is very unreliable. Lots of worries to ponder - which does not bode well for the SP short term IMO.
GLTA - YWNI - :-( Short position
LEI Price at posting:
$16.74 Sentiment: ST Sell Disclosure: Held
