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What is your opinion on Vocus Communication?
I was a long time shareholder of M2 communications, which recently merged with Vocus. I watched the share price get hammered and not sure if it’s a structural issue with the company (massive debt and reduced margins), or whether it’s short term intergestion from the mergers.
I hate to sell companies that have had a massive fall, but don’t want to hang onto it if it’s no longer the top quality company I originally bought. It currently makes up 7.5% of my portfolio, down from around 16%.
Your thoughts are appreciated.
A: Vocus has lost any shred of credibility it once had, so much so that every major analyst now has a neutral or sell rating (no buys).
It will take a long time to rebuild market trust.
Analysts currently have a target price of $2.72.
I suppose I would be a reluctant holder, but don’t expect a massive or speedy recovery. There is an old adage in markets – “your first loss is your best loss”. Interestingly, seems to work about 8 out of 10 times.
If you need some clear air, sell some to get your weight down – otherwise, hang on and hope!
Regards
