Rumour in the city of an MBO - fill yer boots up - GO man GO!!

As a genuine thought provoker on what basis are folks using to invest in bombed out tmt shares. Let us suppose in an imaginary company the following occurs:
1. period N+0 sales warning - share price bombs
2. cashflow negative
3. announces actual losses and very poor outlook
4. share price bombs out altogether and mcap becomes a small fraction of actual sales i.e. it is priced almost on break up value
then all of sudden:
5. period N+1 announces some large new contracts (or in some cases to be precise rumours of contracts)
6. period N+1 positive trading statement
7. period N+2 results shows actual losses but increase in sales/cashflow positive
8. period N+3 actual results shows actual EBITDA profits and further increase in sales/cashflow positive
9. period N+4 actual results shows actual net profits and further increase in sales/cashflow positive and actual dividends i.e. a total dream recovery stock

I guess most people on this board are happy to invest at point 5 above when despite falling sales/reported losses/cashflow even or negative the hope is that when new contracts are signed then this is the start of the mythical journey to stage 9. And hence the excitement over JCP here (and all the mega deals on the fib board - fibernet is one step ahead of nsb on this journey as it has announced deals and a bullish trading statement)

What if the city (eaglet trust apart which is just about unique as a collective scheme in its investment remit re small co investments) is not prepared to invest now but wants to wait until stage 7/8/or 9 has been reached before a major share price recovery happens - we will all be in for a long wait.

This is not a ramp or deramp but it is an attempt to explain at the moment why there is such a muted recovery accross the techmark and I include fibernet/csv and other hopefuls in this list........

friendly comments always welcome.....