RE:bold predictions Hi 20,
My prediction isn’t quite as bold or optimistic as yours. The revenue trends will continue which isn’t a good thing, but this trend has continued unabated for years. There will be lots of spin about the future and the transformation fantasy plan. The overhang from the Competition Bureau review will be glossed over, but it will be hard to find a pony in this pile of manure.
The recent run-up in the share price isn’t driven by significant volumes. Buyers are perhaps feeling a bit more bullish because the shares are undervalued relative to the underlying assets and the spectre of Fairfax swooping in and privatizing the company adds a little more wind to the sails.
The delicate dance that we need to follow is one where the shares get driven down because the results continue to disappoint, but not to the point where Fairfax gives up and walks away from Torstar. That is why your $3.12 breakeven will depend on the Voting Trust coming to their senses and getting out at $6/share before Fairfax decides to wait for bankruptcy to clear their path to ownership.
In a perverse sense, the shares trending to $1 would be better than $2 because that may discourage the Voting Trust sooner which is in everyone’s best interests. They need to drive a stake through the heart of this fantasy transformation myth and do what I advocated in my recent letter to them.
Time for the Voting Trust to assess what has been delivered in a year under this new CEO and the incompetent Chair and cash out before it’s too late.