Originally posted by Hingdog
When you see a stock getting dump on volume like this was after the results announcement, it's much better just to sit and wait for the selling to finish and a solid base to form to buy off. Rarely do stocks sell down on volume only to immediately rebound, they generally take weeks/months to base before any new uptrend will develop. Lots of market cliches could be added here ... "don't try to catch a falling knife", "I'd rather be out of a trade I wish I was in than in a trade I wish I was out of" etc etc
Edit : disclosure should be "not held"
I agree with that good info, when a share price is based on 'not profitable' companies or those with issues. Share prices and holders do crazy things.
But I am a bit simple.... I saw the numbers for the fin year just finished. And I have no reason to doubt the forecasts re fin year 19, which I note are 5-10% up on this year just past. In fact, ZEN seem to under promise. And I think the forecast is not assuming all sorts of new contracts (mind you, those take a while to come on anyway).
So EPS were this year 8.5 cents. And I will assume, given in info in the market, the EPS will be between 9 and 10 next year (as a base). And the company does seem silly simple to me. Now if the company gave up margin for sales they could not forecast a growth in earnings (based on new plant coming on line, I assume). And this company would be insane to give up margin for growth. There is no need.
Now, when the first half came up the share shot to $1.20. Now the 2nd half has come out and we have a 33% fall to 80 cents.
This leads one to want to know WHY the EPS fell from 7.5 cents to 1 cent (as a poster said). I actually did not see those numbers published. If someone can show them to me, I will be interested. One can only find a gung ho 1st half. Then the full year. Do I care that the profit is 'X' for 2018, then projected to be X+10% for 2019. Do I want to get into the lumpiness of it all. If, in 2019 they make 8 cents EPS in first half and 2 cents in 2nd half, do I care. Maybe this is share to buy at end of 2nd half, then sell at end of first half.
