It is of no use if the leadership acts like a bunch of idiots.
I don't fully agree with that. I think it's more a case of investors looking for any kind of excuse not to buy (or sell) a stock.
Let's start with Solomon (SIAF). We all know that he made many promises that he couldn't fulfill. And it's a real problem. But doesn't every start-up have the same problem?
Let's take HERB. I know that they tried for years to boost IR with all those presentations etc. And it didn't help. So they did the asset swap, which was the right move, because now they have a lot of cash. And a major reduction in complexity. Someone said they plan to report by March and we will not get any quarterly reports. Which suggests to me that they may seek a listing in Shanghai. I've always said that should be the next move. Or perhaps they will use the money to buy us out and go private. In which case, what exactly did they do wrong? Absolutely nothing.
I know what the problem is with CCCL. They lost their core shareholder base a year ago (or what was left of it at the time). They had to issue stock for $6.30 to pay off a bank loan. Just a few shares, but it was enough to scare the hell out of everyone. Mind you, $6.30 was cheap at the time because it was trading at $10. I think they will pay a dividend if they have the cash. Problem is, I don't want to wait until July. If they pay a quarterly dividend of just $0.25 and spend a lousy &750,000, the stock could rally 200%. Do they have the money now? We could be close. So if they pay that dividend, this year, then what exactly did they do wrong? Not much. They can communicate better, but doesn't that apply to most companies.
I know there are issues, with most companies. ONP almost went dark one or two years ago. You don't know this, but I do. GURE has a problem because they have the cash and still refuse to pay a dividend. And CGA is a crappy company. They just gave themselves bonus shares like Solomon did, and it's a mistake. I don't even want to get into companies that have VIE's.
The only troubling thing to me is ZAHLY. I can't explain it. But it was pretty obvious early on that they didn't care anymore when they fired the IR guy and didn't hire a new CFO. So it was all downhill from there. Still, it probably shouldn't be trading at 1 or 2 cents. Perhaps it is one of those companies who will make a comeback eventually.
But the companies I own will not go dark. They are much better investments. And they are trying. So that is where the market and I have a difference in opinion.
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