@Pudawocky I think at this point, it's down so much that (providing it's not going bankrupt or doimg a massive debt for equity swap) holders might as well continue to hold.

My position is now worth so little that there is limited furhter downside and so the future prospects present an asymmetric bet.

Once know more about what the cap raise is for can decide. If it's busting the thesis then sell otherwise continue to hold and hope they can return to growth and put all this behind them.

Just read the announcent and it's awful. Funds are claimed to be for supporting "growth in sales capability and resources, especially in the North American market..." which to me is not a good enough reason to be raising when the SP is at it's lowest point ever.

Not to mention that the raise is at a discount of 15% to the latest SP and with a target to raise $20M, represents a 25% to 30% dillution for existing shareholders based on current and cap raise market cap.

The fact that they feel the need to raise at such a discount even though the SP is at it's lowest ever point IMO shows how desperate they are and what an awful state the business must be in.

Absolutely agree.

I can't see myself participating in this raise even though its going to dilute my current holdings.

Honestly wouldn't be surprised if they failed to raise the $10m they were looking for with retail holders..

I just finished re-doing my investment plan for Damstra.

I was to sell if they went into further debt or did a capital raise to fund more acquisitions - however doing a capital raise (to effectively just stay in business) at such a low SP is just about as bad.

I think I'm just gonna sell and harvest my 70% loss against my tax.

Looks like I'm forced to take a night to sleep on it - but don't think I'll change my mind.

I fully expect Damstra to quickly trade below the 15% discount capital raise price.

Good companies usually revert back to the spp price as people take quick profits, even when the company is sound.

Just reading the general disappointment here on Strawman, I think Damstra will get smashed by the market and trade below the cap raise price.

I should have listened to the advice from Claude Walker on the recent Baby Giants podcast where he basically said 'get out now'.

Seems like management have taken absolutely everything out of their FY22 guidance which should HOPEFULLY mean no more downgrades.

Change of CFO as well may improve (hopefully again....) things.

Still have absolutely no faith in management so can't see myself buying anymore shares until there is evidence that their growth runway is back up and running.

Agreed, no faith in management and they have clearly broken the markets trust. Going to be a long way back from here to regain it.

What did you think about management commenting on the share price cratering at the start of their AGM. Left a bit of a sour taste for me. Should always focus on the business first and share price second IMO.

Hope this doesn't lead to promotional announcements to try and recover the share price in the near term..

I do not hold or follow Damstra, however as a general comment about management addressing share price weakness issues, the best management tend to ignore the SP and just concentrate on the business, however a lot of smaller companies are finding that there is often a lot of anger and frustration from their retail shareholders when the management keeps promising the world and the share price keeps heading south, so I guess it is understandable that management teams may acknowledge that they feel there is a disconnect between the company's value and the company's share price, and that they are working to correct that in terms of trying to educate people about that value to hopefully contribute to a positive market re-rating. I'm happy to overlook that sort of thing when management do mention the SP, but only rarely, however I'm VERY wary of companies that tend to look at the SP movement as a KPI (key performance indicator), i.e. a valid measurement of how they are doing as managers.

One example is Advance Nanotek (ANO) (now Advance ZincTek I think they're calling themselves) who seemed to refer to the SP constantly in every company presentation as though the rising price was proof that they were an excellent management team doing an excellent job and that it was all that shareholders really needed to worry about. That was of course when their graph was heading NE, not SE as it has done over the past 2 years. Now it's all about the addressable market and the business opportunities, and that the market doesn't understand any of that at all.

I must admit my favourite companies and the ones I tend to hold most of the time don't bother talking about their share price at all. The only time I think they give any signals in that respect is when they are buying or selling shares on-market in decent quantities. The Chair and MD/CEO of MND (Monodelphous Group, who I hold) who were both major shareholders at the time both sold a good chunk of their MND shares back when the shares were trading at around $19 to $20/share. Both still have plenty of skin in the game, but with the benefit of hindsight, they thought the company's share price had gotten ahead of itself back then (a few years back) and they were 100% correct. MND soon fell and they've never been back to those lofty levels since. I'm still holding because I think fair value for MND is probably around $14 to $15/share and they're currently trading at around $9/share. But I digress.

I'm thinking that the management teams of smaller companies whose SPs have fallen a long way, as DTC's SP has, are probably going to expect some questions around that, and what management's view is on that, and what management are doing about it, so with that in mind they might be trying to get on the front foot, especially around AGM time, and trying to answer some of those questions before they get asked. The main thing to consider I guess is whether the share price is a key focus of the management team or just something they are going to comment on occasionally while focussing almost exclusively on the business. If they seem overly focussed on the SP, I would consider that a red flag.

I agree - it is a red flag for me. As another example, I was for a while a holder of $LVT but got concerned by the CEO's obsession with the discount between LTV of contracts and Enterprise Value. I sold at a small capital loss, but when I look at the SP today, I reflect that it was a good decision.

Similarly, I was a holder of $DTC IRL and sold earlier this year (see earlier straw).

The business numbers have to speak for themselves. As investors we have to focus on the appropriate numbers at a company's stage of evolution. For DTC I focus on revenue growth and evidence of operating leverage at the operating cash level. I sold out when I concluded that revenue growth was lack lustre and there was no sign over 8 consecutive quarters of any operating cash leverage.

As posted previously, I think $DTC is destined to fail because they have too many modules and are addressing too many verticles. This lack of focus means that there cost of acquisition and costs to achieve customer success are going to be high. In my opinion that means it is going to take a long term for favourable economics to manifest, if ever they do. Interestingly, $NEA initially lacked focus on its USA entry, but after two year the CEO refocused on key use cases and verticles, and now the business is making progress. The hope for $DTC would be that they focus down on a smaller number of high value modules and verticles and restructure their cost base accordingly.

For now, I don't see this as a long term investment. I guess traders might make some money as a volatility play. But there is also every chance that it will be a value trap.

There are so many firms on the ASX to invest in that I cannot be bothered to invest in a company where I think management are focused on the wrong things and where I think the strategy is flawed.

I agree @BoredSaint, I normally consider it a red flag. Like Bear, I think context is important. But not on this occasion.

I have criticised Damstra on a number of occasions, most recently posting a bear case around a month ago. I am not a fan of management (nor the business), and I am not surprised that they started the AGM by alluding to the share price.

Normally I would say it's a red flag but given the extent of the share price fall and the short period over which it's happened (pretty much all since the last AGM) I can understand management feeling like they need to address it.

There will be a lot of unhappy shareholders out there and hopefully they were just trying to "head things off at the pass" before it became a barrage of negativity during question time.

I will be watching that though to see if they start obsessing over it and/or releasing "pumpy" market announcements.

Management needs to get back to fixing the business and improving the results, the SP will follow that in due course.