rmnew, I agree that the premium of 400% is very unlikely, but that is if a buyout was to occur tomorrow. There are several scenarios where one can accommodate both the Big Boy and the Big Bang Theories. I give you one of them since you like this speculative exercise. Suppose the trading behavior and the highly depressed price was instigated by an outside party interested in a merger/buyout without the Chairman's involvement and that the insiders were as much a victim as the retail investors for the manipulation of the stock and its depressed price. But the takeover would become less likely with the company following the strategy of acquisition with friendly associates and using the advantage of low prices to gain a majority position. Then a buyout by outsiders on the cheap becomes less likely and the company announces the NG find and a policy of improving the share price and mentioning the higher than $8.00 value. The Big Boys buy as many shares as they can in one day but must now pay well above $8.00 for the remaining shares if the NG discovery is viable and sizable since $8.00 is the value without NG.. Accordingly, a buyout by outsiders has to be at much higher price than $8.00 to satisfy the insiders or some kind of deal has to be made to reward them. If the company takes measures to lift the price and more good news generates greater interest, the market price at the time of the buyout offer will be much higher than $1.60s and the premium much lower than it appears today. There are two other scenarios along the same line with one assuming that the Chairman is involved.
The issue is deeper than just lower revenue and involves government posturing, but I am confident that the problem will be resolved between the two governments but possibly at a higher cost to the company. Meanwhile we should expect a depressed price.
simbaassad, in my opinion buying below $2.00 is just a good strategy and the profits could be huge if we get the major problems resolved. I actually expect and hope the price will go lower today and plan to buy more. This company is viable even without PT sale though it would be technologically at a disadvantage and possibly a good merger/buyout target. Good money was invested in the company by the major investment firms at around $8.00 per share and I don't think they will accept a major loss that easily. But we may have to wait much longer to see real results.
gocolts, all theories have some type of simplifying assumption and your assumption for your Big Bang Theory is a plausibility rather than a wild and baseless assumptions. One must explore all possibilities and the Big Bang Theory is certainly one scenario partially explained by the company behavior and recent developments including the announcements by the company CEO.. If we accept the assumption then the process you have outlined has is a very logical conclusion with the strongest possibility to be pursued and implemented by the Chairman. I must also add that the Chairman already has influential friends in the government.
This is the essence of the Big Bang Theory--buying a $30 plus stock for $8.00 with everyone thinking they are getting a good deal.
doneatfory, when the buyout is finalized is irrelevant unless you like to wait to realize the full value. Usually after the offer the market price will approach the buyout price minus a discount. TBOW was a classic case of fleecing the shareholders by going private. Every effort was made to depress the price and encourage retail to sell and then finally an offer was made at $1.46 with the so called premium of 24.8% but far below the real value of the stock.
I also think that the NG is a GO and the knowledge of it dates to much earlier than admitted. I don't know whether the Big Boys are connected to the Chairman or if he and the company are their target. Both scenarios are possible based on the trading behavior and management's history and conduct. Regardless, I am relatively confident that much higher prices awaits us. If there is sizable NG, it would be stupid not to implement a buyout sooner than later.
gocolts, I have been thinking about the possibility for your Big Bank Theory, mainly a buyout at $8.00 to $10.00 when the stock is worth over $30. That can only happen if there is a sizable NG reserve which can be extracted efficiently. But if NG reserve is of this nature and caliber, then it would not only become a strong possibility but also the BEST strategy for the Chairman and the Big Boys. The shareholders will be happy with the $8.00 plus price when the stock is actually worth $30 to $50 and is bought at a bargain price.
I have already taken out some profit only because of was way overloaded. I will take out more profits incrementally as it goes higher but I have a very significant position and lots of shares remaining to sell if we get a high volume spike day.
It will not be sailing so smoothly until the sale to Altice is finalized and we should anticipate problems from PT and also Altice after March 31. This is a highly manipulated stock and if there isn't a problem they will invent one and widely publicize it through planted news. You analysis on a previous thread is very logical and outlines the most likely course of events. That is also what I expect to happen with good odds and I have been adding shares each time the price drops below $2.00. I bought more shares today at $1.93 and that brought my average down to $2.14.
Good summary except cash is lower after the acquisition. Each of the potential events you have mentioned results in a positive material change and there are actually not negatives. If your Big Bang theory holds it will happen by the end of this year.
Anything is possible but we have to go to $2.00 before getting to $4.00. That can happen if we have a high volume day (300K +) which has not yet happened. Volume has to be high since as the price goes higher there will be more profit taking checking the price.
Thanks for the reply southern. I knew you were getting ready to retire and of course nothing is better than travelling to exotic places and spending time with the family. Good luck.
I also think that they will report earlier. I don't think they will necessarily go ahead with the reverse split especially if the earnings and 2015 outlook are good which will lift the price anyway. Regardless, the possibility of an outright buyout cannot be easily dismissed.
southern, it is nice to see someone who understands my language. I have always highly respected your opinion and now you give me the reason as to why. I am using my own software developed in collaboration with two colleagues for this specific purpose. With the exception of stocks which I call gambling stocks, nearly all my major stock decisions are based on "Decision Theory" and "Behavioral Finance" employing Subjective or Bayesian Probabilities. It has paid off handsomely to the extend that I gave up a highly desirable and well paying position and retired early to devote myself to further research and experimentation. What is your opinion of GURE's prospects? I know you were skeptical about my Big Boys theory when over 30M was traded and due to lack of SEC reporting someone has mentioned that there are a number of Medium Boys which in my book means a conglomerate of medium boys working under the radar.
That is correct. They are not required to report until end of April, but it is good to know that they will announced it in advance. I am looking forward to see higher volume and prices. Thanks for the reply.
The logic of my statement on this thread should be obvious to anyone who has followed this stock and is knowledgeable about the company financials and is aware of the recent developments and trading behavior, but some of you may be wondering how I have arrived at the subjective probability of better than 80% for the price going much higher. This is not merely a personal opinion based on observed data but rather based on careful and advanced analysis of both external and internal factors using Bayesian analysis which enables one to scientifically supplement observed data with subjective probabilities. For those who are mathematically inclined it should be a familiar concept.
Some people were concerned about the sudden fall in the price at closing on Friday. I have warned about this possibility though I have roughly assigned it only 25% probability among the four alternative short term trading strategies outlined in a separate post. I also warned about the danger of having stop losses because of this possibility. As I have indicated on this thread the price will eventually go higher and the Big Boys have no other alternative. I Repeat: they have absolutely no other alternative than seeing higher prices and will do anything within their power to achieve it. However, even though I like to see higher prices, I would be very pleased to see them try to take this down, the lower, the better. That enables me to pick up more cheap shares as I have done repeatedly during past two years (substantiated by my posts) and this time around, since the entry of the Big Boys, I will do so with greater confidence. So there is nothing wrong with the price going down when you know that it will eventually go up. It enables me to incrementally reaccumulate cheap shares and some of you to further average down. If you have relative confidence that the price of a stock will go up, then buying more shares when it is going down will only increase your profit margin. The only thing to fear is fear itself--the fear of risking more money and buying more shares. As I have said, the odds of this stock going to much higher prices is better than 80% and the lower it goes the better it is for those who buy it so cheaply.
gocolts, I am also contemplating the possibilities. If you recall last year I reported on this board about a rumor concerning a group of American and Chinese investors attempting to put together a "low ball" buyout offer. I shall reveal more about my attempts to find out more, here and in China, and even the interest to join the effort; and how lately I have been contemplating the connections, if any, with the recent developments. Look for it in a separate post.
doneatforty, I had a bid at $1.52. That block trade went through at 16:00 P.M. and was prearranged. But there was a last minute effort to bring down the price.