10,000 Hours
One of my specialities, which few can by definition do, is to make calls on small cap share prices that are anywhere near the mark. This has not happened by accident, as I have spent much of the past 35 years working on this skill, on a day in day out basis. Therefore, I have exceeded the mandatory 10,000 hours according to Malcolm Gladwell. I have also exceeded the 10K hours mark on interviewing CEOs, writing about stocks, and being on X / Twitter. It remains frustrating, that there are many in the market offering services who have not racked up such hours, and merely rely on used car salesman techniques to lure in companies to their alleged PR and IR services, audiences and influence. Ironically, the more I tell people not to go to the cowboys and no service providers, the more they get hoodwinked by them. So this week will be the last!
Fly By Night
For instance, I am still to work out what most of the City PR companies actually do, and am dismayed not only by the quality of the fly by night online services, with their attendant spivs. Good luck to them in persuading their clients that they can get share prices up, or find placees, but it does explain the current malaise in the market. We see service providers doing very well for themselves, at the expense of shareholders. Indeed, more and more service providers are coming along, claiming great reach or access to investors, or even buying some stock to get the gig. None of this is genuine and usually leads to failure for the preyed upon client.
A CEOs Guide
I am tempted to write “A CEOs Guide To Choosing PR / IR”. There is currently only one traditional PR company which I would choose, and one digital one. Indeed, on the digital side, most are so scuzzy and shameless that they tarnish the companies that choose them. As a consolation, we know that cream rises to the top, but it can take a while to get there.
Cream
A good illustration of cream rising to the top have been the recent highlights in the Bulletin Board Heroes – the small cap charting video, which I publish six days a week. Stars of the show in the recent past have been Eurasia (EUA) at 2.3p, CAP-XX (CPX) at 0.1p. Mosman (MSMN) and MetalNRG (MNRG) both hit ambitious share price targets well before news came through. The best thing about the BBH, as much as the calls, is that I include not only highly followed stocks, but also some many have never heard of. This puts them on the map as much as any newspaper article or tweet, as only those who actually trade are going to be watching.
The ITM Connection
Looking at the fundamental highlights as far as the small caps were concerned this week, CAP-XX (CPX) was there once again, with the arrival of Dr Graham Cooley of ITM Power fame. Given the market cap of CPX of under £6m currently, and the way that ITM had a market cap of billions at one point, some punters have decided that one plus one could equal eleven.
Kendrick
Another of the risers of the week was Kendrick (KEN), up 61.9%, as it was revealed on Friday that Colin Bird was in on the share register at 19.2%. The mineral exploration and development company building vanadium, nickel and copper battery metal projects in Scandinavia was been notified that its Executive Chairman had purchased 1,750,000 ordinary shares on June 20.
TR1’s
Polarean (POLX) also had a decent jump off the back of a TR1 with Rathbones in at 15% on the shareholder register. Longboat (LBE) was an understandable winner as incoming Chair splashed out on £100,000 worth of shares. Light Science (LST) felt the benefit of a pesky seller finally getting out, and a £750,000 contract win, something which the market should have rewarded rather more than the 15% share price rise on the week.
NEO Energy
There were a few noteworthy situations where the love of the market is yet to arrive. I have been surprised that a rally last month, shares of Neo Energy (NEO) are back at the lows. This may be solely because legacy shareholders are still wetting the bed long after the RTO in November. However, uranium is hot and the owner of Henkries, an advanced, low-cost uranium project in the Northern Cape Province of South Africa should have friends. Why it does not is perhaps a matter for highly capable CEO Sean Heathcote to underline sooner rather than later, and not on some cheapo, generic fly by night platform, as many resources stocks unfortunately seem addicted to using.
Electric Guitar
It could also be the case that we are waiting for the bed wetters to finally exit Electric Guitar (ELEG), where the shares are well down from the RTO in April, despite increasingly positive newsflow. This week’s offering by the digital marketing and advertising company providing first-party data solutions, was that 3radical Limited, its primary operating subsidiary, has agreed a strategic collaboration with Digital Alchemy to help drive client acquisition and engagement. It is clear that ELEG is getting on with the job, and just a matter of when the overhang here is cleared.
Metals One
There was a TR1 released on Friday by Metals One (MET1), which revealed more director buying at just over the 1p level. The market has still not appreciated the significance of MET1 choosing to drop the Gunsynd (GUN) farm in agreement, something one would only do if confidence of the underlying asset, in this case the Black Schist Ni-Zn-Cu-Co project in Finland.
Bank of England
As far as the general market was concerned this week, the highlight had to be a non-event: the Bank of England not lowering rates even though inflation is at target 2%. This was not only political, but also typically sadistic as far as the centrist establishment is concerned. We have seen several examples of this since Brexit, and no doubt after July 4, much more over and above the VAT on private school fees.
The post The Week In Small Caps: June 22 appeared first on Zaks Traders Cafe.
