Another day, another spectacular rise for Supply@ME Capital and a fall to roughly where it started the day.
After an initial buzz regarding an RNS, traders continue to quickly cash in on the popularity of SYME and are most likely preparing to do it all over again, perhaps for the third or fourth time!
For trader’s it’s a joy, but newcomers in particular it can be a cause for panic to see a share suddenly plummet in a matter of hours.
Some investor’s were left puzzled – what more does SYME have to do to generate sustained gains? Why does this keep happening?
The simple fact of the matter is that the RNS’s are not giving traders enough of a reason to stay into the stock for more than a few hours and pass up a 20+% gain. History is repeating itself.
Take today’s release for example. While it was good to see the company had made its move in the US, there wasn’t much substance in the release, hence its sharp fall from its peak.
We already knew it was planning to expand in the US and start a pilot programme, but there was just something to day about joining forces with Anthony Brown and the Trade Advisory that didn’t excite. While Brown is clearly experienced in his field, the Trade Advisory is not a partner that people will see as a serious show of strength for the ambitions that SYME has.
A change in communication strategy? What it can learn from Novacyt
We do believe in the disruptive model of SYME, else we would not have wrote about how it has the ingredients to deliver exceptional returns to investors (read here)!
Recently it mentioned that there will be a change in communication strategy due to various reasons, but this just didn’t feel like it. We really didn’t like the big numbers being mentioned of $1tln, $1.9tln and $700m. This is not to say there isn’t huge potential for the business, but as an RNS it sounds very ‘rampy’ and will put potential seasoned investors off and gives trader’s an inkling to sell.
If one is to look at Novacyt’s RNS output, they are very focused on things worth shouting about and concrete without confusion:
- An acquisition and the clear rationale behind it that is easy for all to understand
- A sizable contract announcement and the confirmed amount / potential volume
- The launch of a new product/s, again supported by fact
With a good business model, it is this type of communication strategy that works for sustainable growth in a share price.
Our honest view is that today’s announcement like a number of others didn’t need to be an RNS. It is arguably a press release by the company related to moves within its business to position itself as already explained to the market.
We say let the financials do the talking when the business delivers. Save the RNS in the US for when the pilot programme is shown to be a success and give trader’s food for thought before they push the sell button for the fourth time!
Investors will thank you for it.