Absolutely noone wants to hear the bull case.. it's PerfectHow hard can it be for people to understand that stocks make their lows
when everybody loathes them?
People here are saying things like "there's no way to predict the low", or "why bother selling, it can't go lower than zero. There's no point selling it now."
I couldn't agree more with this last sentiment.
To my mind, the corollary of "there's no point in selling" is "there's every point in buying"
I liked this line from the article SNgu posted:
"Wigmore concludes that all the rest is due simply to changing social attitudes toward holding stocks"
That line can basically be translated as:
Stock prices can be, and are, tremendously influenced by sentiment.
Remember this news on December 30th, the day before HyGear closed?
"MONTREAL, Dec. 30, 2020 (GLOBE NEWSWIRE) -- Xebec Adsorption Inc. (TSXV: XBC) (“ Xebec ” or the “ Corporation ”), a global provider of clean energy solutions, is pleased to announce that it has closed its previously announced upsized bought deal public offering"
That issue was done at $5.80, and was oversubscribed.
The underwriters excercised their over-allotment option in full.
The Caisse in Quebec did as well, increasing their commitment to $63 million.
Xebec raised $144 million doing a secondary public offering at $5.80.
In total, including the PP with the Caisse, Xebec raised $207 million that day, at $5.80.
What's changed since then?
There have been no offerings since.
Xebec has acquired and assimilated HyGear and Inmatec.
Although it wasn't yet public knowledge, Xebec would go on to announce full-year revenues of $56.6 million.
In six weeks, the company will announce over $120 million.
Xebec is capitalized at exactly $270.9 million today, less than twice the $155.9 million they paid for Hygear. ( Which includes the assumption of 18.4 million Euros of Hygear debt )
Some might argue that Xebec paid too much for Hygear.
That is not the case.
Xebec's acquisition of HyGear was a symbiotic one.
It gave HyGear access to financing it didn't previously have.
Consider this excerpt from TD's analysis of the acquisition:
Transaction Size and Multiples: Based on HyGear’s 2019 revenue of ~$17.7 million (€11.4 million) and EBITDA of ~$5.3 million (€3.4 million), multiples paid for HyGear are 8.8x revenue and 29.3x EBITDA. On a forward-year basis, Xebec management is guiding to “double-digit annual revenue growth” while “maintaining strong EBITDAS margins”. Based on our estimates before the transaction, Xebec was trading at a 2021E EV/EBITDAS multiple of 66.3x when the transaction was announced and, as a result, we view the transaction as accretive.
Xebec will announce the Q4 and year end numbers release date 29 days from tomorrow.
On March 15th, Q4 2020 will no longer show up in trailing revenues.
Today, Xebec's trailing 4 quarter revenues are $6.35 million, $19.65 million, $32.66 million, and 26.71 million.
In 6 weeks they'll be $19.65 million, $32.66 million, $26.71million, and $40+ million.
Q4 2020 becomes a more distant memory with every passing day.
Eventually it will be forgotten entirely,
The market will start looking at the company's future instead of ruminating about its past.