Maybe you are tempted again like me, to take a punt on NBS with the directors recent interest and recent developments. I have invested in NBS/ETC several times, and had a few quick profits, but more substantial losses, so need to remind myself why to stay out, or is now the time .... ?
Why not to buy? 1. They are not making money, or gaining any new contracts. 2. They continue to make extravagant promises but have failed to deliver on any since I followed them. 3. What they release is so deceptive, not revealing critical information that investors would want to know, on who they deal with and what. The presentations are just sales routines and lack key information you need to dig for on internet. 4. A software company that can not even put basic investor info on their site. 5. Directors buying, but their cash comes from MINIMUM pay of $750K (Young) & $450(Dykes) + performance bonuses. 6. At current spending NBS cash will soon be gone leaving them with ... what? 7. Their recent acquisitions smell a bit, what exactly are we getting for this cash? There has been no information on financial returns from these investments, just sales hype. 8. Money came in from no one knows exactly who in the China contract, now it is going out again to ... no one says exactly where or for what ... 9. Character of one director in particular has some question marks last year after a night on the town.
So their past history has not made them any money in the company, so why buy? Why also Orbis and Blackrock (?) buying? Do they know something... The only thing I can see that could make the price go up is NBS actually making money. The other incentive that springs to mind is the placement to retail holders is not going to work while the share price is below the $0.15 offer...
Even if NBS start making money, will the share price go up? There is so much bad sentiment, lack of transparency, and shareholders already lost so much, there must be a lot of sell orders waiting to drop in. The market absorbed the recent big director trades without going up.
$15M Cash position $3.5M paid to directors Changes in last accounts -$6.6M depreciation and amortisation. (on what) -$16M intangible assets. (value of nexcode?)
Well in the past I was sold with the idea behind their products, but it has since left a sour taste in my mouth. The show less inclination to make money now than a year ago, which leaves only the temptation to make a quick buck off other traders from short term fluctuations.
Can the price go down further? Absolutely, they are spending their money, and if they get no further contracts they go broke. They have already committed to spending all their money and more next year!
Can the price go up, yes, potentially a lot, but it will need to convince the market with some steady delivery of contract promises and money flow in. I suspect their are a lot of sellers waiting for a quick rise to recover some money and get out. Wait for this and you may miss the quick dollars, but there will be a steady appreciation of the share price in proportion to the value of sales. If they deliver on promises, sentiment will become more favourable, they have a long way to go back up. Don't be greedy!
Think when buying a company... Is what they are doing making money for you now? When will it make money? Do you understand what they do? Do they do it well? What upside is there, and what will cause this? What downside risk is there and how likely? Does the company surprise or disappoint? Do you the companies reports, would you like to work with them or even have a beer with them?
NBS Price at posting:
14.0¢ Sentiment: Sell Disclosure: Not Held
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