Disclosure: The author has a short position in one or more of the shares mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

Afren equity is toast, ignore the spike says Waseem Shakoor

By Waseem Shakoor

24 June 2015 01:55

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It has been some time since I wrote about Afren (AFR) but, suffice to say, anyone who chose to ignore the warnings about what would happen in a restructuring will now be sitting on very severe losses. From memory, I first called Afren out as a short at 7p, and then added heavily to that position as retail buyers drove the price up to as much as 14p. On Friday, the firm announced that the predicted dilution was on its way as a vast amount of shares would be issued to bond holders in exchange for a very modest reduction in debt:

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Comments

Marvin

24 June 2015, 02:02

Big up to short guys.
spudface

24 June 2015, 02:29

So the fake shake tells everyone to sell to suit his own greedy needs. What scammer.
Marvin

24 June 2015, 04:02

He’s called it all the way along Spud as far as I can see as well as declaring his interest.
Can’t see why he gets so much grief. I for one am bloody grateful to him.
Daniel Victor

24 June 2015, 04:15

I suppose if you were a shareholder,and wanted to retain the size of your investment,there could be a theoretical argument for selling some shares into the market at over 2p and then buying them back in the open offer.So in that case you might not be completely bananas !
Dave Green

24 June 2015, 06:57

Waseem has been 100% correct with his analysis of Afren. Smacks of genius to be honest. He’s been open and transparent and should be thanked not pilloried.
Paul Scott

24 June 2015, 14:20

Hi Was,

Your analysis of Afren (AFR) has been a masterclass in how to do in-depth research, in a complicated restructuring situation. Your analysis was absolutely spot-on, and anyone who had some basic intelligence, and experience of finance, could have checked your facts and figures, and confirmed that your view was very obviously correct.

I followed you into this with a short position, but foolishly I panic covered some of my position on the spike up to 14p a while back, which was a schoolboy error, so the dunce’s cap is mine!
Although I still made a profit overall, which was nice, so thank you.

Actually no, the dunces cap belongs to the deluded fools who, instead of doing their research and understanding what was happening, or saving time and just following your explanation, decided that they knew best (despite not having a clue), and continued to hold or even buy more of this horrible stock as it collapsed.

I really hope people learn the lessons from this stock – don’t get involved in complicated restructuring cases unless you really know what you’re doing. And don’t cling on to a failing share, on hope value alone. Worst of all, don’t club together with other dimwits on bulletin boards, and reinforce each others’ erroneous opinions!

Well done Was, anyone who bets against you is generally going to be wrong, as I’ve observed from knowing you for about 15 years. You’re undoubtedly one of the smartest market participants I know, so keep up the good work informing people of the facts where mug punters are at risk of losing their money.

Finally, some of the racist remarks directed at you made me feel ashamed to be British. Utterly repugnant, and the people involved richly deserve their heavy losses on Afren shares. How nice to think that the abusers’ money is now in your bank account! :-) that’s Karma!

Regards, Paul.