Sell Your Soul, page-54

Broke even on my original short opened 7 months ago (see above post) when SOL was $16.02. In hindsight I was fortunate to exit when i did. Since then changes have occurred:

a) Building approvals have decresed significantly and commencements have begun to decline spelling weaker sales for BKW's products. SOL is largest holder in brickworks.
b) SOL's biggest holding comprising over 40% of their assets is their 25.2% share of TPM. Since thread started TPM's SP fallen further to $6.66. Plus TPM have had a CR at $5.25 and i expect SP to fall further when trading resumes.
c) TPM has successfully bid for 700 MHz of mobile spectrum and plans to spend about $1.9 billion (in total) on building a new 4G system from scratch. They paid top dollar for the spectrum and it will take 3 years to roll out the infrastructure.

All this at a time when NBN is making rapid gains and (more importantly) TLS is ramping-up its new 5G mobile system. 5G will be far faster connection downloads than either NBN (fibre to the node) and 4G.

Will TPG's gamble pay off? Despite good cash flow the competition in telecom mkt is intense. NBN speeds have disappointed many customers and this could rub off on the telco providers.

I expect TPM will resume trading well below current SP of $6.66 and this will in turn drag SOl down with it.

SOL currently cum div 22c but decided to open a short this morn at $18.88. I reckon SOL looks more than fully valued at this level .