STO - Results in less than a month - time to climb?

[ABuzz]

With results due out in less than a month isn't this a good time to be buying STO. Must show an improvement on previous period and maybe even a 1 cent dividend? What do you forumites think? Back to 80-90 cent levels?

[Russ]

This one looks ominously like SAL to me. Can you can tell me why it's less than half the price it was in April this year? I've learnt not to try to call a bottom when a share is getting ever weaker.omo

[Tango]

I've never had any success buying results. Usually, the results are in the price already and the market shrugs off the expected or even better results. But if for some reason the results are worse than what the market has priced in, you will see a drop in the price. Even if the results are good. You may have more success, and I would be interested to hear whether others have had success buying in anticipation of impressive results

[ABuzz]

Valid comments guys. Firstly, with STO being a supplier of services to the mining industry and with the growth within this sector it should carry suppliers up with its growth. Secondly, the downturn in its share price was due largely to the negative sentiment around the so-called irregularities in one of its operations, which turned out not to be as bad as the market may have thought. As it is a thinly traded share it really hasn't got the interest of any major investors driving its pricing. The fact that it had some interest to buy out some or the whole of the company must indicate that the value is there. this offer was turned down, despite being at a premium to the then current ruling price. I propose that this was merely a timing issue, as the share price had fallen on the "irregularities" news and hence wasn't at an optimum level for the directors or sharehilders to accept. It climbed last year around result time and I am convinced it will do the same this year.

[topgun]

The board of STO turned down potential suitors which offered at least 80 cps as this was seen to be opportunistic given the current problems in the group. Recovery is apparently firmly under way. Below 60 cps certainly seems good value. STO does, however, have a chequered acquisition history and seems to be a higher risk company from that perspective. Once growth path re-established could easily trade back to 90 to 100 cps.

[ABuzz]

Thanks topgun, I tend to agree with your thinking and comments.