By Tom Winnifrith | Wednesday 28 December 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.
Lucian is off on a tour of Eastern Euroland but when asked what his top sell tip for 2017 was he was in little doubt - at almost any price the answer is Cloudtag (CTAG) with a target price of nil. Actually Lucian does not see the shares hitting zero. However...
What Lucian predicts is that, at some point soon, Nomad Cairn will have enough of being made to look like the biggest Clowns in the City. At some stage after signing off on an RNS which, yet again, is demonstrated within hours to be predicated on a lie, Liam Murray & Tony Rawlinson round at Cairn will say that enough is enough and resign. Nomad's do not like being made to look like fools by having their name at the bottom of a lie and Cloudtag/Cairn have now issued a string of lies via RNS.
Raising money on the basis of misleading investors, that is to say lying, is securities fraud and in the end there is a chance that those who commit fraud go to jail. Those involved but not a party to fraud, such as Nomads who sign off on release after release which is packed with porkies, will get roped in and it will not be fun. For all concerned, at Cairn, the sooner it quits this account the better.
At the point of resignation - which could happen at any time - the shares will be suspended. A month later, if no replacement Nomad can be found, the shares will be booted off the AIM Casino. What Cloudtag supporting mug punters fail to appreciate is that among City professionals this stock is toxic. No Nomad will act for Cloudtag now after all that has been revealed. As such when Cairn walks this company is toast. It will be delisted and worthless. Those lucky enough to be short will collect their winnings.
Since Cloudtag itself admits that it will burn through the L1 death spiral cash quickly and with no sales in sight, without a stockmarket listing allowing it to issue shares to saps from the LSE Bulletin Board and other fools, the company will quickly go bust.
Cloudtag at 7.125p is Lucian's first share tip of the year as a sell with a target of wipeout.
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