Am I mad or what?

[Richard E]

Hi Everyone,
I am new to trading and have a lot to learn and would love to know more, I find the whole thing facinating. I have just been following Planestation for the last few months and have learned a lot about them, are they a good buy at 11p, I am sorely tempted, am I mad or what?
Thanks for this opportunity,
Richard E.

 

[LION63]

The shares are strictly for gamblers. They have been promising jam tomorrow since time began and have failed to deliver (I have forgotten what they were previously called). They have always had visions of grandeur which are not matched by reality. When was the last time they made a profit or were cashflow positive?

As you probably know, they are raising £30 million via a share issue (250m shares @ 10p - placing and 50m @ 10p open offer). If you must trade in the shares, you are probably better off waiting to see the outcome of this because if it is unsuccessful, the shares will fall and you will be able to pick them up for less than 11p. One factor to consider is that the amount being raised is the equivalent of 60% of the current market capitalisation. The shares have lost 95% of their value in the last 3 years and 83% in the last 12 months.

I know one of the directors and over the last 3 years he has told me what a wonderful company it is and how the twits in the City do not have a clue of how to value such wonderful businesses. My question has always been the same - "It would be quite easy for you to mount a management buyout of the company, keep it private for a few years and then re float it and sail off into the sunset with the hundreds of millions you will bank in profits. Do you not feel that it is a wise option?" Answer .......... I am still waiting for a reasonable one.

Better punts elsewhere, avoid like the plague.

 

[oatman]

Whatever you decide, it helps to be mad :cheesy:

 

[Salty Gibbon]

Madness is a pre-requisite for trading but please note that your particular brand of madness is blended with a fair degree of lunacy which can be detrimental to your trading results.

 

[oatman]

Listen to Salty Gibbon............he's mad

 

[Gardan]

Hi Everyone,
am I mad or what?
Richard E.

Rich, to get Oatman on this subject so early on your thread, you are extremely lucky. listen & take notes.
Good Luck

 

[Salty Gibbon]

Yes agreed.

I have studied Oatman's 2 posts on this thread thoroughly and my notes so far have taken up 3 reams of A4 paper for narrative and 1 ream of A3 paper for accompanying diagrams.

Thanks for the insight Oatman.

 

[keano]

Between truth and madness lies but a sliver of a stream

 

[Richard E]

Hi guys,
Thanks very much for the replys, especially yours Lion, it was very informative.
So it looks like I really am a Newbie and have a lot to learn. But a lot of guys a lot more in the know than I am invested a lot of money in this company when it was at about 50p-70p mid 2004 and this Martin May guy who became CEO last March is supposed to be a whizz kid in turning companys around, dont know much about him, any news there??
Lion are you saying the price will proberly go down before up? And one final question, I am thirsty for knowledge, how can I learn more, any tips?
Hey, I think I can see a few hairs on the palms of my hands!

 

[neil]

Hi guys,
Thanks very much for the replys, especially yours Lion, it was very informative.
So it looks like I really am a Newbie and have a lot to learn. But a lot of guys a lot more in the know than I am invested a lot of money in this company when it was at about 50p-70p mid 2004 and this Martin May guy who became CEO last March is supposed to be a whizz kid in turning companys around, dont know much about him, any news there??
Lion are you saying the price will proberly go down before up? And one final question, I am thirsty for knowledge, how can I learn more, any tips?
Hey, I think I can see a few hairs on the palms of my hands!

Start with the "Search" facility on this site and the "Knowledge" tab at the top of this page.
Beware of people who try to "pump" shares under the guise of a newbie asking questions about specific shares.

 

[LION63]

Richard E,

Those that you refer to as knowing much more than you and bought at 50-70p would now wish that they were in your shoes. It does not profit you to join the slaughtered, they are probably the same people that feel Google is undervalued at $200.

The shares will mark time until the fund raising exercise is completed and then fall unless at least 85% or more are taken up. Needless to say, you will probably be able to buy them for less than they are now. Take a look at the charts and you will find that they resemble a ski slope; you never try to catch a falling knife.

If you are looking for information on share fundamentals you can buy one of the weekly share magazines; apart from that, a couple of books will come in handy - The Zulu Principle by Jim Slater and One Up On Wall Street by Peter Lynch are a step in the right direction.

 

[Richard E]

Thanks for the tip neil, will keep that in mind.
Thanks for the book suggestions Lion, I think I might retreat and do some research until the fund raising exercise is complete, if it is! Besides its not like I have money to throw away anyway. Will be in touch again, thanks for your time. Richard E.
PS Shares are now 13.75p!?!?