RE:RE:RE:RE:RE:We're looking for improved margins and positive EBIDTA in Q3Call my post or me nutty, or foolish, or what have you, but you're trying to rationalize all the reasons that this market trajectory doesn't make sense to you. Yet it's staring you in the face none the less. Markets don't have to follow rules, nor metrics, and never have to be rational. We are a management group that's lost faith, in an industry that's lost favor, in a market that's overdue for a correction. That's the truth, and it supersedes any level or analysis that is contrary. I am with you, the downside is reduced, but alas that too is a very dangerous comfort, as it can be said all the way to zero. I am holding, and I am expecting a rebound at some point, but in the meantime, i am anticipating $2. If there is a single cockroach remaining in the next quarter, $2.50 will feel like $10 in hindsight.
quote=Gann999]Personally I think you are talking absolute nonsense and are crazy to think this way. Have you done any number crunching to support this theory of yours or are you just so disillusioned over the share price that you think it will never end. I will give you that we were way wrong at 8,7,6,5,4,3 but let's talk numbers here. In December of 2020 the company had equity of 344 million assets minus liabilities. In June of this year that equity fell by 25 million to 319.4 million. The market is currently giving xebec a 27 percent premium on their equity valuing the company at roughly 405 million dollars give or take. If the equity were to fall say another 10 million at q3 that would place us at 309 million dollars in equity. If the market were to give us an even worse premium than we are currently getting at say 20 percent for arguments sake, that would still value xebec at 370.8 million dollars. Now let's say the market gets even more irrational as you are suggesting and knocks off and additional 10 percent which I doubt but let's just say it happens. That would still value xebec at 333 million dollars or in terms of share price 2.16. So basically when you say that the market is going to allow this to slow bleed until 2 then as you put it "crater" below 2 dollars a share. It makes me wonder if you even know much about the company at all or just purely are following the share price. Why on earth would the market value xebec at far less than it's equity value as you are suggesting? I get it we keep hitting lows and are only a few pennies above the 52 week low but be rational please. Is there a possibility that the market will still be disappointed in q3, yes. Will it crater below 2 dollars? In my humble opinion, no it won't. At most I can see equity dropping a bit and the premium dropping a bit as well so under my first scenario at 370.8 million a share price of 2.37 is possible or losing another 10 percent from current and to me that would be highly unlikely. I have made this argument based on facts and numbers. I would love to hear your argument as to why a share price of 1.50 (crater below 2) would happen when the equity of the company would far exceed the 230 million the company would be valued at that share price a 43 percent drop from current share price. Are you starting to see yet how illogical your argument is?
catchascatchcan wrote: I definitely hope I am wrong, but sadly I believe it will come to pass. I would caution about such an outcome being a silly assertion. The truth is that any mention of $8, $7, $6, $5, $4, or $3 earlier this year would hone been ridiculed by this entire board, myself included. The last time I bought was at $8, thinking it was a steal. Markets are not rational, and do not bother with book value and cash balance when the conditions are right. I absolutely respect that you or others respectfully disagree, but if XBC has taught us nothing else, it's that us longs have been exceptionally bad at calling the bottom. I do not believe we're going to zero, baring another accounting crisis/fraud, so the downside is becoming limited, that is fair to say. Also fair so say, I'm not averaging down further just in case.
Gann999 wrote:
While I am not ruling out this theory I respectfully believe that you are wrong. What makes you think it's going to "crater" as you put it after a slow bleed. The trading doesn't suggest this up a penny down a penny. Book value is 2.11 and they have more cash than debt. So how exactly do you figure it will fall below 2 dollars. Seems to me companies that trade below book value are low in cash and high in debt that's why the company is valued at pennies on the dollar that's not the case here. Who exactly is going to be selling these shares to crater the price below 2 dollars? I understand the risk of margins not getting better and bleeding cash quarter over quarter but suggesting that the company is worth pennies on the dollar when they have more cash than debt is just silly in my opinion.
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