It's a view - purely that - based on chart action. A claim and an opinion are two quite different things.
BB's provide an opportunity to share opinions about price but, as you rightly say, they don't influence it in the slightest. There's not much other point to them.
Whilst the price is moving downwards (as it is right now) there tends to be more interest in where it might land. The reverse becomes the case when it rises.
504 (hit today) was a fairly easy target to spot so not worth mentioning. The question is whether it will mark the bottom - I suspect not.
The long term 'top' is so far off as to be of little immediate interest - above 1200 seems plausible. To that extent I'd agree with your figures but it's not of much practical help in assessing a buy point today.
A fresh twist on Inmarsat takeover speculation helped propel the satellite operator sharply higher on Friday.
RBC refreshed its longstanding theory that Inmarsat is a bid target with an argument that private equity funds could be interested.
Now could be the perfect time to take Inmarsat private, the broker told clients. Our leveraged buyout model suggests an internal rate of return of around 60 per cent on undemanding assumptions.
The buyout makes sense now because Inmarsats enterprise value is near a 10-year low versus earnings, which reflect an estimated $70m of start-up losses at its in-flight broadband business that will swing into a $44m profit after five years, so the exit should be highly profitable, RBC argued.
Its team also highlighted a long history of private equity involvement in the satellite industry, whose high barriers to entry and strong cash generation appeals to buyout funds, as well as recent share purchases by Inmarsat management.
Fair enough. I assume it'll keep melting up with the market. No one can predict when the correction will come but I think it will be a hard one when it does.
I actually think all the fundamental company related catalysts are likely to be positve (more orders, legal challenge clearing up, renewed activity in commodity markets resulting in improving maritime revenues, analysts deciding they've been harsh and raising their targets, etc) so holding is my choice. Only potential negative I can think of is divi reduction.
Well BC, the news based reason was a market rise across a number of sectors. Plenty to discuss for anyone remotely interested in trading - which was my purpose in exploring whether anyone had any comments to make - especially about the prospects of a retrace and likely target price.
It is interesting how BBs often fall silent when an sp undergoes a rapid increase - I'm not sure why that is, maybe it's a fear of breaking the trend. Not, of course, that chatter on a BB would have any significant effect.
Suffice to say that Friday was a very satisfactory day here and indeed across the market. Will the rally continue on Monday? It seems unlikely - but having top-sliced a third of my ISAT holding I'll now be happy to hold the 'in profit' remainder long term or reacquire, at a retrospective profit, if sub 500 numbers reappear.
Agree after the big fall often a big rise for no apparent reason so may be down next week
I am going to try and stay in & hope the director buying proves correct after the
huge fall they have had all the best
Yes paul - it's a good trading share these days. I'd prefer a solid divi and steady capital growth but I'm not too proud to make a few quid each week by checking a screen now and then...
Actually don't even need to check a screen - just set the next limit order....
An interesting post Dongo. Your 'long' approach appears to lean more towards seeking quality rather than seeking best price. Nevertheless, I guess you still find that some shares disappoint - so presumably you dispose promptly of any that fall out of the relevant quantile - like ISAT perhaps.
I agree that 'cheap' is not of itself a good reason to buy - very often a reason to avoid. Whether ISAT is currently cheap for good reason or genuinely undervalued remains to be seen. It certainly seems to have baffled most analysts.
My approach is.
Ask yourself where ISAT performed in 2017 relative to all the FTSE 100 constituents. For me to go long, I would need to see a top quartile (ideally top decile) ranking. Another way of looking at it is: Imagine you were running a Long/Short fund, would you not want to be short ISAT based on it's pa? Too many people will come up with any efficacious argument to buy something because it is 'cheap'
One step forward two steps back, just about sums up this share.....
Actually it had been four steps forward and one back on the day of Dongo's post. By close of play today the sp has put on about 44p in the three weeks since Dec 12th (I'm using the daily lows as my guide). So, no, I don't think it does sum up ISAT at the moment - time will tell, of course.
Inmarsat has said they're not ready to book a launch on a reusable rocket yet due to the increased risk....
Yes absolutely, but the cost of conventional launches is apparently being driven down too. Here's a blog about Arianespace v SpaceX if you're interested. It tends to support your point about why should ISAT's costs be greater than anticipated.
Indeed that's true Boyabach. Although, Inmarsat has said they're not ready to book a launch on a reusable rocket yet due to the increased risk.
Certainly spend so far matches ISAT's expectations. Are Beaufort misreading or trying to misread the current low margin return on the exercise from the current work schedule focusing on land based infrastructure roll out? Saying that the profit margin's not what was expected therefore the costs must have been higher? With the real profit expected once GX enabled planes are in the air of course.
Not my area of expertise but I was under the impression that launch costs were coming down, SpaceX being the game changer as per this article from August:
To the extent that the technology already exists, why would the costs go above expectations - unless it is to expand the service and consequential revenue? If the biz model requires new/unproven technology then that's a different matter.
Can anyone find any evidence for the claim that, "The cost to develop and maintain a global in-flight Wi-Fi network is going to be significantly higher than either Inmarsat or the stock market expected." ?
I've checked the results for 2015, 2016 and the quarterlies. They all say that CAPEX for each of 2016, 2017 and 2018 is expected to be between $500M and $600M mainly die to GX roll out. There is no change from 2015.
2016 in fact came in at $412.9M. 3Q 2017 was standing at $398. Higher and may well top the $500M in the last quarter but we've had 2 satellite launches and if you average out over the 2 years it looks like it will easily meet the stated expectation.
Small investors like you and I make absolutely no odds to any SP, if we buy or sell .
The big brokers and institutions drive the share price.
Only way you will change is buy AIM penny shares and even the you have to spend £500k
It's frankly anyone's guess and there seems to be a sad lack of consensus. However, my experience has been that falls tend to follow a much steeper curve than recoveries and it's taken two years to get here from 1150.
Still nothing fundamental in the public domain I'm aware of to justify this price. I've been here with ISAT before and it did go right back up again. I must say, it's by far the most sensitive share to analyst reports that I've followed.
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