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Investment Q&A

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Q: I have to agree with Henry, that it just is not normal trading, i also in over 40 years of stock trading have never seen a stock drop in a well managed business like this, have seen in some bio tech company with no earnings and it's drug not being approved, but this a company that everybody knows what they are doing and has good cash flow, a good dividend and yes has a poor quarter, but it is not a company going out of business. The street knew of there acquisitions, there debt level, the companies they compete against and how they are moving forward. To trade 20x normal, do you have any idea who made this large volume of trades, and what qualifies a stock for a PUKE OUT!!! which i have never heard of for a quality stock? Did the fraud in Bre X every have a 40% drop in one day. I would appreciate a a more detail answer on this trading than a general answer that the market is tired of the stock.
Read Answer Asked by eugene on October 27, 2016
Q: Hi 5i,
This is not a question, but rather a note to add to the ongoing DH dialogue. A number of weeks or months ago, DH had a release stating that they were working in conjunction with another firm to explore and develop Blockchain technology (if I read and understood correctly). This, to me, is a positive in that it shows that DH can and will innovate and is not going to be "left behind" if they can help it. Blockchain is expected to be a "disruptive" technology if it pans out as anticipated. DH is looking to try and be on the leading edge, not following and playing "catch up" later.
For myself, I will hold on and wait, perhaps add enough to be just slightly overweight, take the dividend, and give the company a chance to further prove themselves. If I am totally wrong in this, my weighting at about 1.50% (pre-drop) won't cause me too much grief in the big scheme of things.
Anyway, for what it is worth, I thought I would offer this up.......
Read Answer Asked by Mike on October 27, 2016
Q: I have already read all the Q&A and understand your opinion. As an investor I am trying to learn from this mess. With that in mind and looking for past experience guidance to making a decision on my holdings, I am looking for a similar "case study" stock.

A stock that is highly respected, good track record over time, solid management, etc, but in more of a "sunset" business than a sunrise business - but trying hard to change.

The one that quickly comes to mind is Yellow Pages, and we know that did not turn out well for investors - unless they bought the depreciated and restructured company and have seen a nice profit since then.

Any parallels here or other foreseeable surprises ahead?

Your thoughts, please.

Thanks.

Read Answer Asked by Donald on October 27, 2016
Q: Hi there,
How confident are you in DH management to get us through the bad news and grow the business?
How does DH stack up against competition in the fintech space? What is their competitive advantage? Is their acquisition last year helping or was it a drain on capital?
What is the short position today - do you expect short covering?
Thanks!
Read Answer Asked by Heather on October 27, 2016
Q: This is a new one on me. I have been investing for 30+ years and have never suffered a 40+% loss in one day in a stock and my investments have included microcaps, junior golds, etc; 40% gains in one day - yes. Question is: is this a new world? or Is something else happening? The answers you gave for the crash isn't enough to explain such a big drop. It would require a chance in the next year of major collapse or big fraud or official investigation. The company is making money, paying down debt and a dividend. So, is it possible that we are in a world where hedge funds and short-sellers can engineer such a crash in a relatively small (by U S standards) company? or is someone hiding something? Thanks again Henry
Read Answer Asked by Henry on October 27, 2016
Q: I am by no means an expert, but I certainly am an observer of circumstances.

Since joining 5i one of my key observations is, when one of your companies is under a short attack, be amongst the first to leave.

If the ship stays afloat, you're still safe, having abandoned ship. If it sinks you're off and alive to fight another day.

My observations are based on CXR, HCG and of course today's DH. Certainly this strategy would have worked on all of these.

Perhaps a good strategy for those investors with a risk averse bent.

On to fight another day!!

Sheldon
Read Answer Asked by Sheldon on October 26, 2016