Good morning.

I'm taken aback by just how far & fast MySale (LON:MYSL) has fallen from grace. As reported in yesterday's report here, the company issued a nasty profit warning, due to flat sales in its core market. Just look at the chart below - it's crashed from about 175p to only 73.5p in a little over 24 hours.

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With 150.6m shares in issue, I make that a market cap of £110.7m - still hardly a bargain, although it did report cash of £33.5m yesterday. Am not sure what level I'd start to take an interest - possibly sub-40p? I'm convinced there will be plenty more large falls from over-priced early stage growth companies - it very rarely pays to chase fancy valuations in trendy sectors, especially when a lot of the hype rests on having a big name backer - that's no guarantee of commercial success.


Optimal Payments (LON:OPAY)

Share price: 324p
No. shares: 162.6m
Market Cap: £526.8m

This stock is a bit larger than the usual stuff I look at, but I must mention it as extreme volatility has once again hit the company - which could be either a worry, or a buying opportunity, depending how you look at it.

I've marked on the 6-month chart below two events which triggered a substantial fall in share price. The first one was when news broke of the CEO having used the now discredited EFH facility to sell/buy back part of his personal holding, which was dressed up to look as if it was a purchase of shares, to uproar from investors (rightly so!). There were about 5 companies where Directors did the same thing, and their share prices were whacked to varying extents.

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A number of people, including myself, saw this as a buying opportunity, and it was a successful trade, as the shares almost immediately recovered by about 20% over about a week, in late Nov 2014. The company issued a positive trading update at the time, which helped propel the shares back up again.

Well, a similar thing has happened again! It was announced on Friday that the CFO is leaving. That can rattle investors, especially (as in this case) where there has been some other cloud over the company. People start worrying whether there is something amiss…

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