The stock has started to move back to RM4. cheap share price is not going to be here for long.

On hindsight, all thanks to the recent sell down that we can get such cheap price ie below rm3

The stock has corrected way beyond reasonable valuation. It has dropped 30-40%, while PMetal only drops 10%

It’s time to get back in as the stock has bottomed and get ready for the ride up after new year.

This stock has bottom. It should move up after New Year. The catalyst should be its FyE 2021 results. And going forward, it’s financials should reflect the bouyant alloy prices. Current GPM > 100-200%

However, this stock has history of doubling its share price in 1 months. In fact many instances over the past 5 years.

Agreed.

Downside risk at current price is really limited now, but huge upside potential. Esp so when a hostile bidder jumps in

The current depressed only serves to attract hostile bidders who can see a value in omh. Esp when aggressive hedge fund moves in to scoop up this stock and change the management. Just by putting in place whole IR/PR machinery, the hostile party will easily make billions out of this stock and move its valuation to the likes of PMetal/Lynas. Since the founding shareholders only hold 18%, a hostile bidding will add fuel to the lagging share price.

What this stock lacks is a good IR/PR effort which can be easily achieved if the management decides to put in some effort

I think the stock has bottom! It should be able to
Move back to RM4 on the back of the FYE 2021 result as it is expected to be strong on the back of strong alloy prices

FeSi prices in Europe is still very high at EUR 2,900 / ton (US$3,300/ton). OMH cost of production is only US$1,000/ton. That’s GPM of US$2,000/ton or 200%!

If this happens, although all shareholders will
Immediately realised the upside gain, while the existing management will lose control of cash cow.

At current prices, it only creates potential takeover opportunities for hungry growth companies at cheap prices. Even at 50-75% premium, OMH valuation is still cheap

The management will also ultimately have to be more shareholder/investor focused as this is in the best interest of all

The potential upside should be RM4, that’s 40% upside as OMH will be announcing good sets of results for 2H2021 given the high alloy prices that they achieved in 4Q2021

The stock price has bottomed at around 2.65-2.70

As long as key management/shareholder does not priority shareholder values for all, this is what happen and like I said, it’s a “could have been stock”! What a pity when you have management who is unwilling or incapable to run a listed company with shareholder interest at its core

Yet fundamental for OMH is good…with alloy prices still high

When market goes up, this stock doesn’t move. When the market comes down 4-5%, this stock drop 40%! You just have to compare with PMetal. WhenPMetal moves, this stock stays, but when PMetl dropped only 10-15%, OMH drop 30-40%! With no liquidity

With just 10k shares, the stock drop 3%! This is “free for all” sell down.

Key management/founders that is so disinterested in advancing shareholder values can never become the likes of PMetal and Lynas that many investors/shareholders look up to. This can only fall into the category of “could have been” as OMH is still operating very much with private SME mindset.

If you want to know why some companies valuation is so high vs it’s peers, despite being in quite similar business segment, look no further at OMH mgt vs the high performing mgt of PMetal and Lynas. In this case, key founders/mgt attitude towards increasing collective shareholders value (or individual shareholder value) is crucial. This is the case of either the key decision holder is incapable or unwilling to advance collective shareholder value.

If Omh can achieve the a fraction of Pmetal market valuation, then I agree with you that there is no need for share buyback, just continue expansion.

OMH has been super lagged and can easily drop 30% with small volume. The share price is now lower than 10 years ago. What has the shareholders benefited? Shareholders value is being eroded constantly.
What I am saying is a balance approach to expansion, taking care of shareholder values (through div, share buyback, active investor relation to bring higher PE and share price), rather than one sided approached to managing a public listed company. And it is true that Chairman incentive payout is geared towards profitability, but that has not translated into increasing shareholder values.

Are you saying softbank has no future investment plans

Now is the time for management to do something for shareholders!!!

Softbank announced share buyback lately, and the share price jump by 11%. It still puzzles me why the management is resisting share buyback scheme that benefits all shareholders and signals to the market that the share price is undervalued.

But if you look at OMH, share prices has been tumbling down 30-35% for the past month and it is even lower than 10 years ago. You can see how shareholder value has been eroded despite skyrocketing ferroalloy prices. The Chairman incentive payout is linked solely to profitability but no direct linkage to shareholder values (such as share price, market cap or dividend). Even though, some shareholders have called for share buyback, it is resisted by management as share price is not a determinant of Chairman incentive payout. many shareholders suffer – this is the “Prosperity for one” mentality.

I can now see why PMetal is worth so much more than OMH despite the fact that OMH might make even more profit than PMetal.
It all boils than to management. PMetal investors trust that PMetal management will take care of shareholders and has consistently increase the shareholder values for all shareholders – this is the “Prosperity for all” mentality.

Two possible reason (1) short seller or (2) Takeover given how cheap the company is now. Bring down to making takeover offer at a lower price is clever strategy.

Most shareholders, I believe would welcome a new shareholder who may give the stock a booster.

Current management looks a bit ‘worn out’, and the existing shareholders also equally ‘worn out’ waiting too long for disappointing shareholder returns which looks very illusive under current team.

It sure looks like the share price is coming down on a ‘managed’ manner

OMH Chairman/CEO and directors incentive payout is based on profit and is not tied directly to shareholder returns (ie Div, Share Price, Market Cap). The incentive to work on share price and shareholder values may not be the top priority of the CEO. Whether shareholder values is up or down, will not impact CEO incentive payout, while shareholders values may stay stagnant or even drop. I fully support profit incentive for the CEO but the incentive is missing out the element that links directly in to shareholder values.
The incentive to invest in IR and create shareholder value may not be as strong or given equal emphasis.
Also share buyback will give tremendous value to all shareholders but have been resisted by management/directors, wonder why when it is in the interest of all.

If you look at the management compensation of good progressive companies with outstanding shareholder returns (div and share price), their payout are linked to shareholder returns. management n shareholder interests are aligned

Yes it will drop below RM3 or even lower. Because the counter is now being controlled by the short seller. This is despite very strong earnings

Looks like a bumper profit day for the short seller. Although the ferroalloy prices are at record level, the short seller can still bring the prices down from RM 4, that’s quite some thing.

This short seller is a smart cookie and experienced. You can’t bet again him. Better off to join his game
“If you can’t beat them, join them”

And OMH is seriously cheap as a target. And Pmetal can well afford to buy when OMH is only 5% of PMetal market cap

What I am saying is OMH is a good fit into PMetal business esp when PMetal is also looking into silicon metals which is what OMH is producing

OMH produces Ferrosilion which feeds into magnesium production and in turn goes into aluminium smelting operations. It makes sense for Pmetal to seriously look into OMH.

OMH profit for 2021 and 2022 will close up the gap with PMetal or might even exceed PMetal. Yet the market cap for PMetal is 18x bigger than OMH. This is insane

You need to “shock” therapy to bring out the weak hand. Today is very obvious

But I do believe they are in buying back mode now. They have shorted since RM 4

You can join the short to bring the price lower and buy back. If you can’t beat them, join them

Look back on fundamentals if in doubt. A stock cannot be too undervalued for too long. A takeover will surface if the deal is too good to be missed.

Founding shareholder only controls less than 20%, there is a good chance many shareholders will sell out at a good price

I hope this can happen just like what happened in 2008 when it was almost being driven up to A$5 (before split) when an hostile party starts to bid up the price for OMH to try to gain control

Also the most valuable thing for OMH is the 20-year Low cost power contract from renewable energy!

Given the strong cash flow with potential EBITDA of US$500m, with forward PE of 2-3x, it is no brainer for a takeover. Probably the cheapest target on the market now

I hope this is more than just short seller driven.