VOC - Vocus Group

[galumay]

My initial thinking was what you outlined, but I should look at writting out my own '10 not so stringent commandments for investing'.
Appreciate your feedback.

Start a decision journal, get disciplined about wrint down what you are thinking of doing, what the alternatives are, what the risks and rewards may be and document an expected outcome. What this does is slow down the human impulse to action and puts some time between the impulse and the action! Revisit to check your thinking on a regular basis. This has been a very powerful tool for me.

 

[JTLP]

Ok, 90% invested in one company puts some perspective on your comments! I think I would agree there is a lesson to be learnt there, although if you were certain enough of something then it might be a single path to great wealth creation!!

So far I have only averaged down where I was convinced the business was investible when I made the initial entry, and where I considered the drop in price was an over-reaction to changed circumstances. (my involvement in the CR for SGH was an exception.) I have done very well out of averaging down into businesses like NWH & CDA. I guess there might come a point where I felt I was over invested if the price recovered strongly and made the business a big % of my portfolio - but it would be very dependent on my analysis of the business, size of the position alone wouldnt make me sell down.

CCP, UOS and DDR have become much bigger positions than my average, but I have no interest in selling down to reduce size. (and they are not businesses I averaged down into, just businesses I accumulated where ever Mr Market priced them lower than I valued them and I had capital available.)

Where I have resized the position I did so because I wanted to free up capital for another opportunity.

Oh how I wish I took a bigger position in CCP.

 

[So_Cynical]

Lesson learned well to a certain extent, that I should have a certain amount of capital allocated and not go beyond that point.
I guess theres no science to averaging down, just whatever you feel comfortable with, yet this pushed my comfort levels.

Thought / feedback on how you Galumay and contrarian deal with averaging down would be appreciated.

Rules are needed, its all good to see something cheap and take a position, to see it fall further and take a smaller bite, discipline is important as one never knows - as a knife catcher you have to be prepared for zero, to lose the lot therefore you cant bet the lot or anywhere near it, my maximum is like 6 - 7K or there abouts, 5% of the account.

Truth be told im not really comfortable with 5% thats the extreme end of the scale, like to keep it less than that...but sometimes it just has to be done.

 

[MrChow]

Any thoughts on recent happenings?

More key management resignations and competition for the NextGen Cable.

 

[mcgrath111]

I think it's more noise.
Vocus will finish the cable first and the management issue is old v new.
I jumped in today, less capital this time though haha.
Im comfortable riding it the storm for a while

 

[Triathlete]

It might even get to $3 yet..from a quick glance....time will tell though..!!

Just broke support at $3.69 today to close at $3.57....we might finally get the move down to $3.00.......any thoughts..!!

 

[MrChow]

Vocus wouldn't want to announce a downgrade or there'll be a class action discussed.

It's in the top 1% of shorted stocks and had a 4 fold increase in volume the past 4 days.

 

[JTLP]

Vocus wouldn't want to announce a downgrade or there'll be a class action discussed.

It's in the top 1% of shorted stocks and had a 4 fold increase in volume the past 4 days.

I can't see a downgrade but potentially they may need capital for their Perth to Singapore line? But thought this would have been covered. Maybe people don't believe the story.

 

[Triathlete]

Vocus wouldn't want to announce a downgrade or there'll be a class action discussed.

It's in the top 1% of shorted stocks and had a 4 fold increase in volume the past 4 days.

All I know is from a technical view the stock is weak and it has further to fall at this point in time in my opinion.

I base this on the fact that the 50% level of the all time high is $4.56 and 50% level of the all time range $4.83 have both been broken back in December 2016.

The move back up from the low week ending 23 Dec 2016 $3.69 to the previous high of $5.89 of $4.58 week ending 24 Feb 2017 is less than a 50% retracement which indicates the stock continues to be weak and now it has broken down to a new low on the down move of $3.57.

For long term holders I would be just expecting further falls at this time and for traders the shorts look the best option at the moment.....Let us see how this one plays out...!!

 

[JTLP]

There you go. Slammed with Telstra on news of TPG building their own mobile network. Does this really affect VOC though as they aren't in this space?

 

[Ves]

Does this really affect VOC though as they aren't in this space?

Iprimus and Dodo are both resellers of mobile phone plans.

Also don't forget the SuperLoop (SLC) acquisition last week. The bit about the submarine cable is a potential competitive issue for VOC.

 

[JTLP]

Iprimus and Dodo are both resellers of mobile phone plans.

Also don't forget the SuperLoop (SLC) acquisition last week. The bit about the submarine cable is a potential competitive issue for VOC.

But a reseller is a bit different to an owner. And it's not like it's entirely new competition?

 

[galumay]

The news about TPG and their mobile network was well known prior to the official release so not sure how much impact the release of the 'news' really had. I think the negative sentiment around telcos generally is pretty strong, I took a position in VOC at the low 4's and am not surprised its fallen further. It will take a couple of positive reporting sessions to see a real turn around IMO.

Dealing every day with the structural dysfunction and incompetence of TLS and TPG makes me think there is plenty more bad news for the major telcos in the future!

 

[skc]

The news about TPG and their mobile network was well known prior to the official release so not sure how much impact the release of the 'news' really had. I think the negative sentiment around telcos generally is pretty strong, I took a position in VOC at the low 4's and am not surprised its fallen further. It will take a couple of positive reporting sessions to see a real turn around IMO.

I think the market wasn't sure if TPM was going to bid... and certainly wasn't sure that TPM was going to win the spectrum auction. Mobile's big profit pool is about to be carved out by a 4th player and margin eroded by price competition.

 

[JTLP]

I think the market wasn't sure if TPM was going to bid... and certainly wasn't sure that TPM was going to win the spectrum auction. Mobile's big profit pool is about to be carved out by a 4th player and margin eroded by price competition.

I still don't understand the real effects on a reseller though? Don't TPG already offer mobile?

Interesting to see pundits views on the TPG auction deal. Seems pretty exy the way they're talking.

 

[Boggo]

...

Dealing every day with the structural dysfunction and incompetence of TLS and TPG makes me think there is plenty more bad news for the major telcos in the future!

Looks like that whole sector has been on the nose since Jan 2015 and today it broke down through the 50% retracement.

Weekly of the XTEJ

 

[skc]

I still don't understand the real effects on a reseller though? Don't TPG already offer mobile?

The same as any other provider really... more competition, lower consumer price, lower margin, higher churn. VOC's retail broadband may also be impacted if TPM rolls out more bundle deals etc.

TPG has ~500k mobile subscriber under a reseller model. It mentioned in it's presentation that the net work is expected to be EBITDA breakeven @ 500k subscribers. Assuming TPM intends to make a return on the ~$1.9B capital invested, they'd probably want to gain more than their current share. Price is probably the quickest way to gain that share, and the gains will probably come from the cheap and nasty end of the market (VOC, Amaysim etc).

 

[Triathlete]

I have updated my Vocus chart based also on the latest Fundamentals from Lincoln stock doctor just downgraded...www.lincolnindicators.com.au............. 14 day free tral

Strategic comment.
Last updated: 13 April 2017

VOC is no longer a Borderline Star Growth Stock following a recent discussion with the company.

Following that discussion we are now of the opinion that they will not achieve the hurdles set for outlook and forecast when they next report. As previously commentated, VOC needed a lot to work perfectly, and though not a Star Growth Stock, we are disappointed with this outcome. The complexity and number of acquisitions unfortunately will now mean they are unlikely to meet our metrics within the next 12 months.

Weekly Chart:

 

[Boggo]

Almost identical, 2.90 to 2.97 being critical, below that ????

Daily chart

 

[mcgrath111]

I have updated my Vocus chart based also on the latest Fundamentals from Lincoln stock doctor just downgraded...www.lincolnindicators.com.au............. 14 day free tral

Strategic comment.
Last updated: 13 April 2017

VOC is no longer a Borderline Star Growth Stock following a recent discussion with the company.

Following that discussion we are now of the opinion that they will not achieve the hurdles set for outlook and forecast when they next report. As previously commentated, VOC needed a lot to work perfectly, and though not a Star Growth Stock, we are disappointed with this outcome. The complexity and number of acquisitions unfortunately will now mean they are unlikely to meet our metrics within the next 12 months.

Weekly Chart:

View attachment 70727

Hi Triathelete
Did they go into why it doesnt fit the criteria?

Or just the short outline you added?