My comments were less directed at what the new board and management will do than at the pumpers on this board who were predicting a relief rally at the end of the proxy fight.
If Wise's victory were so obviously good for shareholders as you and others predicted then the stock should have moved to a higher range, $1.2-1.5 seems about right. The stock is stuck in the mud despite an out loud bid for size which tells me that many shareholders do not view Wise's victory as good for them - as opposed to being good for Wise and his massive contract. $1.5mm per year is a lot of money for any company but especially for one this small. Time will tell, but a move to terminate this obvious conflict would be a very positive sign for shareholders. Wise is supposedly very wealthy, so he shouldn't miss the money. There are a lot of people that can source $1 bags in Asia for $1.5mm a year or less.
my position is that Wise will be doing absolutely everything in his power to increase the share price - because that is how he is going to get the biggest bang for his buck - seeing the value of his shares increase significantly. I have been in a few of these situations in the past couple years where dissidents/activists won a proxy fight, terminated CEO, took over the board, and made changes that were successful - every one of them. I have no doubt that the same will occur here.
give Wise a quarter or two, let's see what happens, and if the reality does not live up to the expectation, then we can throw stones. in the mean time, give him a chance. if people want to sell the shares down, great - time to average down. we know it's a value play, the profits are there, and the path/plan is there to increase profits. it's all good by me...I'm in no big hurry.
you can't expect that only weeks after winning the vote everything will have been done.
Time will tell. How will the sourcing contract be treated? It is very rich for a pure agency deal. Interests are not necessarily aligned with shareholders, perhaps even diametrically opposed to shareholders as the sourcing contact can be very lucrative to Wise while shareholders can lose money. A very good sign would be to either 1) Bring the contract back in house, 2) Award it to a global brand like Li and Fung with no conflicts or 3) Merge Wise's sourcing operation into Forward for a nominal value as not clear there is anything there other than the Forward contract.
In house would be the cleanest and Wise could still use his sourcing expertise to help the Company, he would only stand to benefit as a shareholder and not a vendor, but as the largest shareholder he should be ok with that outcome.
Yes, I agree - some of the new board members should be buying at some point.
I'm not sure if Wise could buy more as I believe there may be a 20% restriction.
I'm willing to give them some time - I'm sure they have many business/organizational things to be attending to at this time. Certainly Wise is actioning what he outlined in his 90 day plan.
Again we shall see if anyone steps up and buys. How about some of these new board members? The Company is trading at cash so the bar is low. The bulls should be buying here. Plenty of tax selling was done before the last trading days of the year and many bulls here talked of buying not selling then. The Company needs to perform operationally, period. No proxy distractions to blame. So I would want to see contract wins and ideally some gross margin improvement from the sourcing side. 20% gross margins are very low and leave little room for error.
the point regarding tax loss selling is simply that during December when the tax selling was taking place, it was putting additional downward pressure on the shares. whether the shares are repurchased is of no importance.
there will be some churn in the shares for a few weeks - some people who were buying at the December lows will take quick profits, other longer term holders will sell as they see they've recouped a bit. after the churn is over, then shares will be able to more easily move higher.
Tax loss selling states that you can not buy back (wash sale ) a stock for 30 days so if someone sold on Dec 30 they can not buy back until Jan 30.
My point is a broader one. The bulls on this board were preaching that happy times are here with this change. Now that change has happened and tax loss selling at year end is done, why is the stock still languishing? Makes no sense, maybe other large holders don't share your and others' optimism. From my standpoint, the management team that was replaced was able to take a company with years of operating losses and turn them into profits. The new management team and board have a lot of incentives to tilt money to sourcing and away from shareholders. What stops this from happening? What if the Company loses a big contract, will the sourcing contract be renegotiated downward, or will only shareholders take that pain? It is largely a fixed cost contract, putting shareholders at risk for almost every dollar of operating profit lost. With the stock trading close to cash value, there would appear to be value here, but not if the Company starts to lose money. I don't see how shareholders are necessarily likely to profit, given the incentives to shift dollars to sourcing and away from the Company. The bulls should be scooping the stock up here but all I see is crickets and new lows for the stock.