Elliottician and TA Thread

Newts........

jm111 >>>

One of yours, SEO, it makes what seems to me to be a reasonable RNS yet it falls 1.5p? Any views?

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I took Stanelco off my 'investment' list a few weeks back. I did hold 50000 on CFD from 14p as a trade but sold that soon after into their rise for nice profit. I do still trade Stanelco however when possible.

It's worth noting that I trade direct access CFD's(as well as investing) therefore I place orders directly on Level 2 so most of my trading is scalping. As Stanelco is a SETSMM stock I can place orders on their Level 2 book which is why I follow + trade them. I could be long in the morning, then short into a fall, then back long again....all in a short space of time....i.e few hours.

I was thinking of an investment in Stanelco based on the company looking an attractive long-term investment. Good tie-ups with Asda could be really significant for this companies long-term future. However, after doing loads of research and diggin deeper for information I have decided against investing in this company. Infact, I would'nt touch it with a bargepole now.

My reasons?? Well something definately doesn't seem right. SEO currently priced at 15.5p have a market cap of £144m(absolutely crazily over-valued) with virtually NO assets whatsoever. The company is loss-making and also have a cloud in the shape of a court case hanging over them with BioProgress PLC(which has already gone against Stanelco...just an appeal against the verdict now)

Take a look through all their RNS's.........Loads of positive RNS's but in my opinion, they're nothing more than blatant ramps by the management......Trial announced here, trial announced there, trial going better than expected, yet upon these trials ending you never hear the outcome of it......i.e. NO orders seems to follow. The management are mad on issuing ramping RNS's!!

I recently spoke to their finance director on the phone. He stated that the rollout of greenseal machines is behind schedule meaning set-backs here and there too as you will see from the following RNS's.

Right onto why Stanelco get hammered today........

**24/03/2005 08:30 AFXU Stanelco sees over 5 mln stg annual sales from ASDA contract win
Asda anticipate that several hundred machines will be adapted to utilise the
technology, Stanelco said.

Now todays RNS.......9 months into the 12 month trial....

**16/12/2005 07:01 UKREG Pre Close Update

We are currently working with ASDA and four of its key suppliers to fulfil the
initial stage of the ASDA contract. Current potential placements are expected
to lead to orders in excess of 50 conversions with one supplier to ASDA.
Another supplier is presently indicating a requirement for another 30 machines.


In other words........Stanelco only have potential orders of just 80 conversions so far(admittedly from 2 of the 4 potential key suppliers) which means that if "in excess of £5m" was expected annually on "several hundred machines converted", this has surely now gotta be vastly reduced to more like "be lucky to make £2m" at the moment.

Whilst yesterdays RNS looked good, it most certainly wasn't but in the circumstances I guess that was the best ramp that the Stanelco management could do. It seems however, that the market saw through this...hence todays shareprice slump.

Again, market cap of £144m, loss-making company employing approx 50 staff in total with nothing more than a few small contracts in the bag. ASDA contract valued at best around the £5m-£6m mark annually meaning surely this company is way over-valued at 15p and hyped up as well?

Will let you folks do your own research but smoke and mirrors come to mind here.