CMicrocaps

Jack Austin of JC Equity joined me for the latest edition of the Coffee Microcaps Fund Manager interview series. We discussed 2 of the fund's current stocks @G8Education $GEM & Coast Entertainment $CEH #asx #microcap Interview is on the YouTube Channel youtu.be/Hx8pi1s-wlk

Australia’s largest superannuation funds say rules introduced by the Morrison government are forcing them into poorer, more conservative investments. afr.com/companies/financial-…

At least 12 small-cap funds have been forced to close this year as persistent inflation and high interest rates continue to punish the smaller end of the market. afr.com/markets/equity-marke…

Our next Coffee Microcaps Morning Meeting is happening this coming Friday, 23 October. We will be joined by Intelligent Monitoring Grp $IMB & @PainChek $PCK for this Zoom webinar. Thanks to our event sponsor, @DMXAsset, for their support. #microcap #asx us02web.zoom.us/webinar/regi…

If The Big Short was made in 2026

In this month’s DMXCP report we discuss three emerging companies with global opportunities that we met with during the month. In the DMXASF report we provide our thinking on the takeover offer for $KME which has now been recommended by the board dmxam.com.au/monthly-reports…

I’m constantly amazed at the horrendous capital allocation decisions microcap management make. Here’s a list of past behavior historical red flags you should include in your AI prompts: 1. When companies have an ATM and a buy back in place at the same time. 2. When companies buy back stock shortly after an offering. 3. When they quote investment banking studies in private conversations with you, to justify why they should have a shelf out there. Well ya!!! …. That’s easily my favorite. 4. When the liquidity sections in filings state a company has enough cash for the short and long term - then do a raise. 5. When management makes public statements that they don’t have to raise capital and then do so shortly thereafter. 6. Issuing a shelf right after they raise a bunch of money. WTF, let it fucking breathe before you destroy shareholder capital. 7. The “just in case shelf: Management teams that justify filing a shelf registration because “the stock might go up” or “an acquisition opportunity might come along.” Then months, sometimes years, go by with no acquisitions. Or better yet, they make acquisitions without ever needing to tap the shelf. So why did they need it in the first place? Investment bankers are usually the ones prodding a company to do this after showing them how they could’ve raised money when the stock went up if they had a shelf … and now it’s back down. “Be ready for the next move,” when in actuality, who knows if the stock would have went up with a shelf out there - the bankers leave that little detail out of the equation. 8. Management teams that seem to view every significant increase in their stock price as an opportunity to issue more shares, regardless of whether they actually need the capital. 9. Management teams that justify issuing more shares because they want to increase trading liquidity. So you’re willing to dilute existing shareholders to make it easier for other investors to trade your stock? That’s your capital allocation strategy? I’m not saying companies shouldn’t tap the capital markets to raise money via equity. But if you want shareholders to trust that you understand smart capital allocation, you have to earn that trust through decisions that make sense and demonstrate an ability to create shareholder value.