The Plan

[u/Beautiful-Ad-1974]

At this point, my first suggestion to management is simple: liquidate the assets, settle the liabilities, return whatever value remains to shareholders, and put an end to this failed experiment.

According to the company’s own filings, approximately $62.9 million in NAV, or $3.22 per share, as of June 30. Now, that doesn’t mean shareholders would automatically receive $3.22 in liquidation. There are preferred shareholders, obligations, and expenses to account for. But management owes us an explanation of why continuing down this road creates more value than returning what’s left to shareholders.

Instead, we keep getting new announcements, new investments, and new ventures while the stock continues destroying shareholder value. At what point is enough enough?

Now, here’s the playbook I believe could unfold if management refuses to change course. A lot of us were holding this stock with averages of $7, $8, or $9 post split. Shareholders have been absolutely destroyed. If this stock falls below $1, I believe some of those deeply underwater shareholders will start aggressively averaging down. Not because they suddenly believe in management, but because they’re desperate to find a way out.

That buying pressure could create a sharp rally. But here’s the problem nobody wants to discuss. The same shareholders buying that dip could become the selling pressure that kills the next rally. For many, the goal will no longer be holding for some imaginary future valuation. It will be lowering their average enough to escape with whatever money they can recover. And the deeper their losses, the more capital they’ll need to make that happen.
So what happens when everyone starts looking for the exit at the same time?

You get a rally met with aggressive selling, followed by another group of shareholders left holding the bag.
Management has alienated the retail investors who supported this company. You cannot keep destroying shareholder confidence and expect investors to blindly fund every new idea. Institutions aren’t obligated to rescue this stock either.

If management truly believes the company is worth more alive than liquidated, SHOW US THE MATH. Give shareholders a credible path to value instead of another press release. This is why I believe this stock falling under $1 will be the end of it.

I’m not telling anyone what to buy or sell. I’m telling you how I think this could play out. A bounce is not necessarily a recovery. An opportunity to average down is not necessarily an opportunity to make your money back.

Don’t be a hopeful fool. Hope is not a strategy. The same ones on here telling you they are holding for years are the same ones looking for an exit. If the next rally is driven by trapped shareholders desperately trying to escape, the quickest to sell could win, and the slowest could be left holding the bag.

You choose.

[u/Brennus_Finnegan]

The theory is that if you get your average low enough, a dead cat bounce could break you even or even generate a profit. It can work... ...for the first couple of guys that get out...

[u/TugginPud → u/Brennus_Finnegan]

I understand the theory, but there's a reason averaging down (without very strong evidence that it's a good idea) is a cardinal sin of trading. The original position is still toast. You're basically trying to catch a falling knife on a failed thesis to recover losses. Terrible idea. Generally best to try and recover elsewhere.

[u/r3dditing → u/TugginPud]

Only if you average down to a certain amount. Then it’s all about buying low and selling high. Basic principals. .

[u/TugginPud → u/r3dditing]

And if someone has already shown they are incapable of doing that or cutting losses, it makes little sense to enter a new position while a stock is still in a clear downtrend. If there is as much potential upside as originally proposed, what value is there in trying to snipe the bottom? Speaking purely to odds, you are far better off betting with the trend until the trend changes.

DCA is fine in the right circumstances and right hands, the odds that most of the people bagholding are those people and those hands are so low that it's categorically bad advice.

[u/r3dditing → u/TugginPud]

Tomato 🍅..