I'm inclining to think the market feels the same way as I do. That is the third report that I have read that has left me feeling perplexed. Not worried, just perplexed.
You'll gather from my recent string of posts on the reports that I am really struggling to understand what is going on here. But after this third report leaving me feeling the same way, I am developing a working theory.
I think that Barry's later reports were habitually confident because the evidence was writ large that the strategy was working. But then came the time for the company to do a big pivot towards being marketing led, changing from building the foundations to building the house on top of the foundations.
But how to make that change? The company could have gone on to establish profit under the old model and thus gain market credence before the pivot. But that would have meant several years delay in gaining the advantage of the pivot. It also would have required Barry to hang around for even more years and frankly I think he was very generous indeed to give us so many years in such an arduous role.
But then that meant that, with hindsight, the current situation was inevitable. Just when the company finally had a good story to tell it had to embark on a totally new strategy. For a starter, it will take time to refine that strategy into a clear concrete plan. But more importantly they cannot possibly yet have the evidence of definite results confirming that the new strategy is definitely working. Plans are one thing, results are another. And visible confidence can only really attach to seeing the results, I guess.
So my working theory now is that I am perplexed because the company is not yet confident in where the new future lies, and that is coming through in the reports. As I say, with hindsight this is probably inevitable given the huge pivot going on.
But if this theory is correct then the market is hesitant for the same reason that I am, that the company itself is hesitant. For we shareholders this is obviously irritating. 10 years of waiting and finally victory looked to be here. Instead it will be another couple of years in uncharted waters as the company pivots in a huge way. Only then will we be hearing the confident talk of the future that is currently absent. Probably only then will the market really buy into this story?
All just my theory, of course.