Migao Corp MIGGF

RE: RE: RE: RE: RE: Why the drop?

[souwester]

dbeaude,

Without a doubt, naked shorting should be a criminal offence.

I also believe that outlawing traditional shorting (needing to borrow first) should be seriously considered, though perhaps a highly regulated form of shorting could serve to limit irrational upsides, as long as there are safeguards to ensure the covering of the shorts, and limiting the shares which can be shorted - i.e., any share available to be lent (those in margin accounts, I understand) should only be lent once.

There is however a risk factor when all a company's assets are in a foreign country, especially an emerging country like China. Moreover, this supply deal raised concerns. No one really knows the terms or the principals. $100 million upfront? Only a 5% saving in return? With a Russian company? Big suppliers denying it?`Sadly, it sounds like the whole China Flu thing.

In terms of shareholder value, that 100 million would have been better spent on a share buyback or in dividends. Which ties in long-term with why I am out after several years. These guys can't or won't create long-term shareholder value. The analysts are all "tomorrow, tomorrow" about MGO. But tomorrow never comes. Why? Simple, management is not focused on it, or doesn't care. Even if this deal did make modest economic sense, it should have been vetoed due to its forseeable impact on the market, given the lack of transparency.

Bare minimum: MGO needs a buyback and a strong,  independent chairman of the board.