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Avanti Communications and the 60-80% fall in prices it is not shouting about

By Tom Winnifrith, The Sheriff of AIM | Friday 13 May 2016


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.


Perhaps that is why drowning in debt Avanti Communications (AVN) has been unable to hit any of its targets and perhaps it is why it is going to run out of cash his year. It seems that the price it can charge for satellite capacity has fallen by up to 80%. Who says so? er...

My attention is drawn to that must read publication "Satellites.com" and the October 2015 Edition of its magazine HERE. Turn to page nine , column one, paragraph one and it is the bombast himself, Mr David Williams pontificating. Taking time out from threatening Bulletin Board posters with lawyers letters for the crime of postintg the truth, Mr Williams is quoted as saying that prices have "fallen by 60-80%" over the past few years.

The issue is overcapacity and the gist of the discussion is that this trend will continue. I applaud Mr Williams for his honesty in this matter but wonder why this alarming development and issue about forward earnings has not cropped up in any RNS statement to date? Whilst I read Satellite.com, surely all investors have a right to know about a trend which is likely to send Avanti shares to 0p before Christmas.

Sell.


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