The thing I am definitively not is a chartist, so I won't be able to be of any use to you in that regard.
You sound quite agitated, seemingly, about SKE's share price. If you are a short-term investor, then you probably could be worried, but I wouldn't really know.
Bizarre as it might sound, I, on the other hand, take great delight in the share price falling. You might find this impossible to believe, but it's true.
You see, I am in the business of buying income streams (aka Free Cash Flow) for myself, and the cheaper I can get them, the better.
Of course, the quality of those income streams is critical. Even if they become more cheaply available, buying of unsustainable or "poor quality" cash flow streams still inevitably results in wealth destruction.
So it's important that Free Cash Flow is robust, durable, defensive, granular, and has the ability to grow.
And that's what I two years ago identified with SKE once the previous CEO (son of the founder), who had presided over significant wealth destruction, was disengaged from the business.
The market might indeed sell the stock because of its "mining service sector" association, like it is doing now, but I don't own SKE on the basis of HOPING on external factors such as the resources sector rebounding on even more HOPE that China buys more coal and iron ore.
I own SKE because of what I identify happening (not what I HOPE or ANTICIPATE will happen, but what IS already happening) internally within the business under the revived board and the new CEO who I consider the be highly competent in the understanding of what drives value for shareholders and what destroys it.
Accordingly, that as well as the way I model forecast the balance sheet and cash flows to develop in coming financial periods, has led me to conclude firmly that SKE will continue to increase in intrinsic value (something that can at time be at odds with market value for extended periods), largely IRRESPECTIVE OF WHAT THE RESOURCES CYCLE DOES OR DOESN'T DO.
And the manifestation of that increase in intrinsic value, I believe strongly,based on the conservative analysis I have conducted over several years (and which I continue to do), concludes – inter alia - that SKE's DPS within the next two years will be above 22cps, from 13cps currently, based on an assumption of zero top-line growth.
That puts the stock on a prospective dividend yield of 10%.
The stock price is unlikely to trade that way.
Instead, I think the denominator in the dividend yield ratio (i.e., the share price) will adjust upwards.
Pick you own value...even on a prospective 6.5% yield (a significant premium to the Small Ord DY), that translates into a 340c share price.
Or near-50% upside.
My glare is focused on the business, not on about short-term twitching in share prices. Because I recognise fully that I can add just about zero value in terms of the latter.
SKE Price at posting:
$2.30 Sentiment: Buy Disclosure: Held
