Chalice Brands Ltd CHALF

RE:What is going on with this stock?

[jutah70]

@ Snickel - I recently was in a situation that was strangely familiar.  I have referenced owning BNK in the past.  So the Coles notes:
- great story, market loved it, investors bought in (similar with GLH);
- missed targets, sent to the dog house (traded down and stayed down) (similar with GLH);
- CEO resigned and got new management (rumblings that similar action be taken with GLH);
- got act together & new CEO, met targets, then exceeded targets (GLH showing signs of getting act together);
- showed consistency in growing numbers and exceeding/meeting targets - market dumbfounded at where the stock was trading (similar with GLH - disconnect not completely understood);
- collapse of oil price drives stock down further (investor apathy and frustration beginning to show);
- stock begins to recover a little, then gets driven down by news item (this news item sheds light as to why there was such a massive disconnect that no one - even analysts - could explain or figure out);
- with stock slammed down once again apathy and frustration grows again;
- buyout offer comes for less than the proven reserves - apathetic investors accept offer because they just want whatever they can get (something they would never have accepted before - and fall prey to the logic of 'well, who cares about the value, it's up from the lows of $X.XX - short term traders make out, investors get their nuts handed to them);
- the timing of the offer and nature of how it happened seemed too orchestrated.  As well the stock did not even trade near the offer price for a long time (I got out after a few weeks to move into the play even deeper).  The whole situation just stank, and I was pissed at management for selling out shareholders (a situation where they managed the stock under the guise of the company).  I am sure management made out like bandits.  Shareholders got screwed.

Not saying a buyout is coming, or the company will be taken private.  But if someone has designs they will keep this stock down and frustrate shareholder to give up what they own before they take it up.  So many people get the attitude of 'I'll be happy just to break even'.  And with how many people who bought into this story thinking they were going to make money fast, I could see them accepting less than what the company is worth.

Moral of all that is there were forces keeping that stock down (much like here).  And eventually an offer came to buy them that no one but short term traders would have even imagined, let alone accepted.  Hopefully this stock does not go down that same path.  That shareholders would get so frustrated with the disconnect that they would say yes to a lowball offer if the company were to be bought or taken private.