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Stuttard’s Septic Seven – March update (or is that down-date?)

By Nigel Somerville, the Deputy Sheriff of AIM | Sunday 19 March 2017


Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.


Marcus Stuttard, as head of AIM, completely trusts and supports the regulatory framework of the world’s most successful growth market. As such, and ever keen to help, ShareProphets put together a beautifully diversified portfolio of AIM-listed stocks for him, so that he could demonstrate his faith in the system he oversees by investing in stocks which we have Red Flagged. How better than to put his money where his mouth is to show us that there is nothing wrong. Last time I revisited the portfolio it was down by some 23%. If that had Mr Stuttard feeling a bit queasy, he had better look away now….

Of the original seven, African Potash was booted off the Casino last year following the resignation of its Nomad, AIM-China Filthy Forty play Jiasen (JSI) followed suit at the end of last month via voluntary euthanasia (with some cock-and-bull story that it might go for a Hong Kong listing instead….yeah, right) and CloudTag (CTAG) is set to follow the march to oblivion a week on Tuesday – deadline day for finding a new Nomad after even Cairn lost patience and walked with immediate effect. The finger is hovering over the zero button in anticipation.

Pro tem, we have CloudTag marked at its suspension price, but Jiasen is our first outright zero. African Potash is nearly there, but having been allowed onto the NEX (then ISDX) lobster-pot its shares are (just about) still tradable, although running out of other peoples’ money looks a safe bet in the coming weeks.

Elsewhere, we see that Filthy Forty play Aquatic Foods has been seeing some slippage once again. Having spiked higher on no news the shares have been drifting back towards the 12.5p from whence they came, but for now this is the only share in Mr Stuttard’s portfolio to be in the black.

Then there is Tom Winnifrith’s old friend in the form of Eden Research (EDEN) with his accusations of fraud and the small matter of outstanding warrants held by a company (with a few names associated with Eden) which has been struck off and dissolved. Eden shares have slipped a little further

The third constituent from the Filthy Forty, China New Energy (CNEL) seems to have been drifting rather, despite ramping away over its prospective revenue stream for this current year. Some might want to consider what sort of revenue recognition policy sees receivables go up by more than revenue during a reporting period. Clearly this is one for Mr Stuttard’s portfolio but I’ll be steering clear myself.

And finally Taihua, which completed its share buy-back funded by an open offer. It all seems to have gone through. Oh – and the non-exec chairman dumped his entire holding in the buy-back tender offer (good call, pal!) at 3.28p. The shares have now drifted back to 2.675p. Might there be an impending vacancy in the Chair?

And so, after less than six months, with two shares already departed the Casino and a third due to follow in a few days, with all but one of the original picks in the red Mr Stuttard might be beginning to wonder about the wisdom of investing in stocks Red Flagged by the ShareProphets team, as he is now down by a whopping 39%.

Ouch.

 

start (mid)

now (mid)

Change %

AFG

12.5

14.5

16.0

AFPO

0.185

0.03

-83.8

CNEL

1.525

1.275

-16.4

CTAG

18

2.875

-84.0

EDEN

11.5

11.125

-3.3

JSI - delisted

3

0

-100.0

TAIH

2.75

2.675

-2.7

       
   

Average %

-39.2

 

 


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