Dick Smith shows why too many floats sink

This on the float of Dick Smith from Intelligent Investor analyst Graham Witcomb two years ago:‘If private equity group Anchorage Capital successfully floats Dick Smith (ASX: DSH) for $520m, its investment will have five-bagged in just one year. Anchorage purchased Dick Smith’s 325 store network from Woolworths (ASX: WOW) for just $94m last November. Is such a turnaround in so little time really possible?’Graham was rightly suspicious, claiming that Dick Smith was being floated on 13 times forecast and ‘highly questionable’ earnings. The retailer closed last night 87% down on its float price of $2.20.Investors buying stock from private equity...

This on the float of Dick Smith from Intelligent Investor analyst Graham Witcomb two years ago:

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