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Stuttard’s Septic Seven – February update: oh dear!

By Nigel Somerville, the Deputy Sheriff of AIM | Sunday 19 February 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.

ShareProphets has Red Flagged quite a few companies on AIM, but as we all know there is no problem of fraud on the world’s most successful growth market. This is why we created a diversified portfolio of Casino stocks for AIM head honcho and Sham Sheriff, Mr Marcus Stuttard, to invest his own cash and thereby demonstrate his complete faith in his team of oxymorons at AIM Regulation. With the portfolio heading towards the end of its fifth month, here is the latest update – and it is not a pretty sight.

The big news this week is the impending demise of ShareProphets AIM-China Filthy Forty play Jiasen (JSI). The company proposed delisting from the Casino and getting onto NEX (the lobster-pot formerly known as ISDX) but at the last moment it was announced that it hadn’t got its application for fast-track admission filed. Shareholders passed the delisting resolution anyway (I rather doubt any UK investor would have bothered to make the trip to Fujian Province, and by the time the non-filing of the NEX application was known one would have expected the proxy vote to have been sent in already).

Jiasen now claims to be considering an application to get a listing in Hong Kong or some other exchange somewhere. Good luck with that – if it ever bothers. But this one will be a zero as of the end of this month. For now, Mr Stuttard has the chance to make a dash for the exit at just 1.5p bid (against a mid-price at outset of 3p, with the current mid-price sitting at 1.75p he is down by 42% on a mid-to-mid basis), but of course he won’t because he completely trusts the regulatory environment of AIM and thus Jiasen is a very fine company which is drowning in cash, trading on a tiny fraction of earnings, at a massive, massive discount to its growing cash-pile and there is obviously nothing wrong. Nothing at all.

Jiasen will be the second of our seven to depart the Casino – the first being that very fine and completely squeaky clean outfit of Chris Cleverley called African Potash (AFPO), which only left AIM after its Nomad took the wholly unreasonable decision to resign as Nomad and “resign” the QE who had been overseeing Potash.

But unlike Jiasen, Potash got its fast-track application to NEX filed on time and we can still monitor its progress there. Oh dear – a spread of 0.02p-0.04p, the spread is wider than the bid price! At a mid of 0.03p that means Mr Stuttard’s original investment at 0.185p mid is down by 84%. Oops.

The other big loser in our fine and beautifully diversified portfolio is CloudTag (CTAG), having dropped 66%. But Mr Stuttard can rest easy, for that is an improvement since our last update. No matter the lack of revenues, profits, orders or, for that matter, saleable – or even demonstrable – product.

And so the scores-on-the-doors as we approach the end of month 5: a mid-to-mid loss of 23%.

As that nice Mr Blair once put it, Things can only get better……


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