A long time ago a strange old man showed up in a small farming village. He was accompanied by a young assistant. They stayed for a few days and then he made his intentions known to the villagers. He said he was in the business of buying and selling monkeys. He said he came to their village because they have many monkeys running free in the surrounding forest. He said he would pay any villager $10 for every monkey they could catch and deliver. This was a very poor village and so nearly every villager left their farms and went about catching thousands of monkeys and as the old man said he paid them $10 for every monkey. But as the supply of monkeys dwindled, many went back to their farms. The old man would not have any of this, so he told them he would pay $15 for monkeys, 50% more than before. So, the villagers left their farms again and worked harder to capture monkeys. When the supply of monkeys decreased even more they again went back to their farms in even larger numbers. The old man said he simply did not have enough monkeys and would pay $30 for every monkey. The villagers eyes got very big. But said the old man I have to leave on other business but my assistant will pay you . And so they went out and scoured the forest for monkeys. They worked very hard to find monkeys because by now the monkeys were not very friendly. When they had caught every possible monkey. they went to the assistant to complain that there simply were not anymore monkeys to catch. So the assistant said, look I have over 10,000 monkeys caged right here. How about I sell them to you for $25 and when the old man gets back you can sell them to him for $30? So the villagers went home and emptied their piggy banks, sold their belongings, and borrowed money from neighboring villages and bought all the monkeys from the assistant. They never saw the old man or his assistant again. Now you know how Wall Street operates. Earnings, great products, etc. is just a smoke screen.
and sadly, most people in the village continued to think this was a story about monkeys, so when, a few years later, another old man came along with his assistant and offered them $10 for every parrot they could bring him, they were delighted at this great new opportunity.....
If you want to see some monkey business, follow LOTE (now LOTED). Just split 4:1 and is (or was at a point yesterday) trading at a $1.5B market cap. Last financials showed they had $140 in cash, $80k in assets (not a typo) and revenue of $120k for the year.
A few weeks later... The Villagers now having an abundant supply of monkeys do some market research. They learn that the fur is usable for designer clothing by the likes of Gucci, the meat is a staple in North Africa and Monkey Brains are a delicacy in Thialand. They negotiate contracts with various companies and begin rendering the Monkeys and shipping the various components out. It becomes an profitable business and they are approached by a Investment banking firm and list an IPO on the Nasdaq for their new formed "Monkey Business, Inc" (Ticker MBI). The IPO generated nearly 500 million dollars for the Villagers. Even better as he IPO is priced at 10 dollars and Monkey Components become scarce, their product price rises to record levels, never before seen in the History of Animal processing. Soon ADM the Cargill along with Hormel and General Mills all want in on this business. There is a bidding war on the company and shareholders (all now well into the money) agree to sell at 100 dollars a share ( a ten times initial investment profit) to a late bidder Iowa Beef Processors. The now 5 billion dollar market cap business is the mainstay for quality Monkey Meat and Fur. They recently introduced a division for supply of Circus and Show Business Monkeys and soon are utilizing their award winning breeding program to supply Monkeys as Pets (some say Monkeys will replace dogs as mans best friend).... Time will tell.
LOL, very good Mike.....but no monkeys were harmed in the original story. Somehow I suspect your storybook ending would have been fraught with legal battles which you conveniently omitted.
Of course one of the lessons of the original story is that no matter if a company sells cars, movies, widgets, headphones, or even monkeys, the success or mediocrity of the product, the business itself, has little to do with the business of selling shares of stock. That, is all about finding less smart, less astute investors to first buy from at low prices, manipulate the prices higher, create a buying frenzy, and then sell to at higher prices........then walk away, not necessarily when the product has lost its luster but when you (the old man) have sold all of your monkeys. The lesson is to follow the old man, the big money......get into the market when the old man gets in and get out when he gets out. What the monkeys are doing is of no consequence.