July 17, 2019
The $50k Challenge is officially launching today with the first stock being purchased.
Stock Code: OVL
Shares purchased: 2,000,000
Share price: 0.005
Reason for buying:
1) Recent acquisition is in a hot sector (rare earths) with very favourable terms.
2) Small raise just completed at a 50% premium to the market price. This makes me think they could have raised much more but wanted to minimise dilution.
3) Currently trading 66% higher than the raiseprice and so looks like it went to sticky hands.
4) Top 20 holders hold nearly half the shares on issue so tight register.
5) Low market capitalisation and enterprise value considering the sector.
6) Advisor performance targets much higher than the current share price.
Risks:
1) Current cash on hand is $1.1m and they will need to raise more over the next 12 months. If at a premium to current share price then won’t be an issue.
2) Due diligence for acquisition ongoing for the next 2 weeks. This risk will be eliminated once the acquisition is complete.
To ensure complete transparency, I own a core parcel of shares in OVL with an entry of 0.0025. I have been holding this long term parcel since mid-2018.
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