Batm Advanced Communicat... Share Discussion Threads

[fse] 02/8/2022 16:45

I have read over echo post #20944 and I would concur that this goes a very long way in explaining recent movements/weakness.
Ages ago I posted on here when the company was included in the index. It meant more share purchases (obligatory) also it improved market sentiment.
We now have the situation in reverse.
The really wretched thing about all of this is that it has precious little to do with the material side of the company which has experienced a string of positive news.

[fse] 02/8/2022 14:52

From twitter a bit more on the relevance of the City Fibre initiative

[kooba] 02/8/2022 13:42

Why look away..this explains quite a lot and certainly explains the aggressive short position to mop up index tracking shares dumped. Quite clearly Israeli investors have been aware quite some time ago. Once done it might remove overhead pressure. It's what happens when you underperform an index by over 50% in 7 months!Not something i had checked clearly ..but i did point out the relative performance the other day to the TA-125..should have checked i suppose.Not sure how this really supports the hypothesis put up but I'm sure you do.Thanks for sharing least one mystery solved.

[echoridge] 02/8/2022 13:39

sorry, I may have butchered the link (regardless, anyone trying to confirm what I've written re BVC's deletion will have to register on the TASE website. If you don't want to bother, you can take my word for it of course): Hopefully, this works:

hxxps://www.tase.co.il/en/market_data/indices/updates/components/indices/equity?objId=137&updType=0&dType=1&pType=1&View=0&category=1&lang=1&sortBy=IndexNameAsc

[echoridge] 02/8/2022 13:24

Kooba, look away.....I think the mystery is solved. This is what I suspected for some time now, but when I checked the TASE website last week, it had BVC unaffected by its biannual index review. However, on a subsequent, deeper dive, I realised I was looking at another TASE index as it appears that BVC is in fact being ejected from the TA-125, a rather important index of which I had no idea it was even a member. Obviously it would have been one of the smaller constituents in the 125 for some time now, but weakness over these past 6 months must have pushed it well into the relegation zone. Hedge funds and traders plugged into these things would have realised the Company was likely to be ejected as early as the beginning of July and started shorting it then, as this type of activity is a well-worn trading strategy. As I wrote above, this is what I suspected when I referred to the short selling in particular as 'non-economic' and the timing of the announcement fits the general pattern of trading I highlighted, but now I'm certain. The deletion of BVC became official on the 21 July review, but the shares won't be formally rejected until the index 'rebalance' takes place at the close (I assume its the close) on 4 August:

hxxps://www.tase.co.il/en/market_data/indices/updates/components/indices/equity?objId=137&updType=0&dType=1&pType=1&View=0&category=1&lang=1&sortBy=IndexNameAsc

I am as surprised and disappointed as anyone that we are now the victims of 2 major index withdrawals in a little over 7 months in a single year, but our focus should now turn to the math and the usual trading patterns by the relevant actors for these types of situations. The math is relatively simple: by Thursday, the short position will likely be around 11-12m shares, so the only other number that matters is the estimate of how many shares will need to be sold by index funds that track the TA-125. So far, I've heard estimates ranging from 15 to 20m shares. That could mean some continued heavier volume out of Israel until the 4th (though that is far from certain) and then a need for buyers of maybe 5m shares on the rebalance at day's end in order to ensure a relatively calm close on Thursday. Where would those buyers come from? Well, while some of us have been in the dark on this, many have not, including institutions - particularly ones that already own the stock of course - in Israel who are likely preparing bids at various prices for the rebalance as is so often the case with names like BVC which are measurably cheap and anyone can see that it is primarily the index rebalance activity that has pushed the price down unduly. In addition, we also know that index funds do not leave all their business on rebalances until the final moment of the final day anymore. I can't say with any precision, but I'm certain that at least a decent chunk of long selling (maybe 10%?) has already occurred as those funds are prepared to take the (tiny) tracking risk from having reduced or closed their long positions in BVC prior to the rebalance date. Finally there are the big 2, the Company and Lombard, as possible buyers on the day. In the case of the former, we know that the Company was in the market on the Russell/FTSE rebalance but didn't get any as the hedge fund shorts outbid them and as we all know, the share buyback permission is still very open and very much unused. However, I believe the Company is now in its closed period before the interims so that dog may not be allowed to bark even if it wants to (Though you can never be certain. The exchange may give the Company dispensation as this is a pretty unusual situation. Still, its unlikely). As for Lombard, they are doubtless aware by now of the index deletion, but whether they can or will participate on the rebal is obviously unknown, but it is a possibility. Finally, with just a little over 2 days left before the rebalance, the one thing we all know above anything else is we are finally in the very final stage of an event that has caused a great deal of selling but which has nothing whatever to do with the market's view of the Company's financial prospects. Post the close on Thursday, that is about as bullish a technical backdrop, and therefore as high a likelihood of a significant recovery, as a share price can have. Roll on the interims.....

[kooba] 02/8/2022 13:11

Ha..whoever is shorting must know that a share buyback ain't starting any time soon otherwise the positions (currently SIR at 21 ) would be far harder to cover if Batm were operating on a % vwap basis. Do they know why its not operating though , must think they do?

[kemche] 02/8/2022 13:04

Has Passover ended yet?

[kooba] 02/8/2022 12:07

What you actually said was"Conclusion: I strongly believe the traders behind the short position in the Israeli line, are beginning to realise that they've got this one wrong, or at least have (way) over-played their hand amid what I believe is an improving demand side for the shares in both jurisdictions. This is causing a steep decline in supply from short sellers, and could even result in a squeeze as some of the legacy shorts start to look to close their position. Again, this is what a bottoming process looks like in my view, and we should see the end of it by Friday/Monday."That was before the latest data from TASE came out showing that the short position had shot up again during week ending 28th July.What we are still seeing is a vast % of trade in Israel being short position taking at an evidential increasing rate even at the lows.Now the bullish news is that it will have to be covered and there could be a squeeze yes..the negative news is why are they shorting and why are they increasingly shorting at these low levels.i presume they are not indeed idiots and did their homework..what are they seeing that is not yet in the public domain?

[echoridge] 02/8/2022 11:36

First and foremost: the short position in Israel is exactly, precisely what I have been writing about now for 3 days. 1. it has been growing, as I wrote, for some 6 weeks now, but I specifically chose the end of last week to begin addressing it as I - in 5 posts now - detailed what I see as strong evidence that the impact - EVEN AS THE SHORT POSITION MAY CONTINUE TO GROW - was diminishing and 2. I detailed those reasons; from improving markets creating new buyers to - much more importantly - buyers specifically emerging in Israel who were prepared to build/increase their positions at these 33-35p levels despite this continued short selling, thus blunting the impact of that selling; and 3. convincing me that they're very aware of the short selling and either, they don't care as BATM has simply gotten - especially post the CF deal - way too cheap, or that they are also aware of why the short is building and understand that it is not linked to any material negative view on BATM's valuation or decline in its business environment. Or a blend of both. That is why I've just now starting writing about a bottoming process, making these levels especially attractive, s.t. (again) the markets not melting back down.

[kooba] 02/8/2022 10:51

Yep easy take ..they sell shares they believe they will be able to buy back cheaper. One presumes they believe the current fundamentals or expectation in the market does not support the price and they will be able to cover their position by buying at a lower level when their expectation is adopted by the market.Sure the problem for shorts is if the company surprise them on the upside then there could be a mad scramble ...or squeeze to cover positions quickly which can lead to a spike in the price.Only other thought is whether the short could be a technical position as stock moves from one market to another ..but can't think why that would be or why the position is incrementally growing.

[kooba] 02/8/2022 10:43

Echo without including the fact that the short position in TASE increased by a sizeable amount over the last week and increased far more than the previous week does not really support your hypothesis that things are turning. In fact it demands more questions.But it is fact that i have brought into the debate. The motivation as to why a short position is building representing over 20 days of average daily volume is what should be being discussed.

[kooba] 02/8/2022 10:38

I didn't say you did say short sellers were idiots as it goes...but i said "you" to generalise would have to think they were idiots aggressively selling BATM down here.Non economic selling makes no real sense does it unless you a forced seller. Shorting stock is an economic judgement where you believe you will be able to buy the stock back at a lower level..it's a valuation call and valuation will be impacted by fundamentals. The call though seems to involve some opinion not in the public domain.

[car1pet] 02/8/2022 10:19

Kooba I'm not a short trader so don't have any experience of short selling but I think I understand the principle of shorting which is to sell shares you don't own and fulfil the trade by buying at a lower price which you can do because the short selling drives the price down. That works with some shares. This share is a bit different in that most analysts see value in the company and therefore the share price is low for reasons which aren't obvious and some positive newsflow could cause the share price to rise suddenly and the short sellers would lose out as they would have to fulfil their trades buying at a higher price than they sold. If 10m shares have been "short sold" those short traders must be expecting the price to fall further so they can buy at a lower price than they sold. Or have they already bought at lower prices than they sold?
Also its interesting that all this short selling seems to be happening on the TASE and not here.
I have to admit I am confused about what is happening. Hopefully the H1 trading update will throw some light on what is happening.

[echoridge] 02/8/2022 09:46

I didn't call anyone, in Israel or otherwise, 'idiots'. This is another of your go-to techniques where you purposely exaggerate my point to an absurd degree, which further demonstrates that you just want to butcher your way through any disagreement rather than maybe concede a point, agree to disagree, or some other less incendiary outcome.

[echoridge] 02/8/2022 09:42

Non-economic selling is selling not related to fundamentals.

[kooba] 02/8/2022 09:28

Is shorting non economic selling ..in fact what the hell is non economic selling?

[kooba] 02/8/2022 09:26

The idea that there is aggressive short selling in Israel for an Israeli centred company with the UK mopping up their shares does not fill me with confidence to be fair. Unless you think professional sized shorting at current levels just shows those active on TASE are idiots , they must obviously think they have an angle that is not obvious to us.

[kooba] 02/8/2022 09:17

Over 21 days SIR

[kooba] 02/8/2022 09:16

I see the short position updated to 28th July in TASE has grown by a further 3m shares to well over 10m. Very aggressive shorting relative to average daily volume.https://www.tase.co.il/en/market_data/short_sales_weeklyAnyway Israeli selling is drying up.

[kooba] 02/8/2022 09:12

You post as though you have some expert knowledge on what is going on in Israel but your posts and many of your takes since i have been reading this board have been very wide of the mark. What you think is not fact..it's an opinion..and opinions need backing up if you don't want challenge.You say you are looking at underlying specific stock behaviour not relative performance across markets ..with no real evidence supporting to be fair ..but then go on to say that all this conjecture is subject to those overall markets performing.If you don't want folks questioning your super takes..then posting on a public bulletin board may be not for you poppet.

[echoridge] 02/8/2022 09:05

yes, that's the takeaway.

[owenski] 02/8/2022 08:57

echogrudge still lecturing everyone I see. lol

[kooba] 02/8/2022 08:22

So sensitive..relative performance is a thing you know.The fall was wholeheartedly put down to market weakness..now we don't follow markets when they recover?Trying to analyse price action and volumes across two markets with fungible securities is not a fact based exercise imho. All guesswork.Anyway hope your crystal balls are right..a move to 50-60p by end of the summer being a perfectly reasonable target would suit me fine. I might well move on as i am not particularly impressed with the transparency here.