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11-Apr-24 Berenberg Bank Buy - 420.00 Reiteration
https://www.proactiveinvestors.co.uk/companies/news/1045098/alpha-financial-share-price-offers-attractive-entry-point-analysts-1045098.html
Peel's target price is 395p, versus the last close at 312p, while Stifel's is a more bullish 440p.
In the period being reported the company has paid out £12M as a final dividend. Looks like there was some 'one off acquisition costs too. I dont see what bearing the equity has on the front end sales of the company, Clearly growth has slowed, but according to them they expect more in H2. Its a hold from me, though I managed to sell a few this morning in my trading account for less than 1% profit! (I have actually done well here recently, buying the dip twice and selling all the way up to £4).
"The Group's net cash position was £16.1m as at 30 September 2023 (31 March 2023: £59.2m), reflecting the normal H1 timing of payments, a further £18.6m of acquisition consideration payments, including £1.7m of employment-linked amounts, and the payment of the £12.0m FY 23 final dividend in the half. During the period, the Group also provided £3.8m funding to Alpha's EBT to purchase 1,033,954 shares at the prevailing market share price. These shares will be held in the EBT, a discretionary trust, and are intended to be used to satisfy future exercises of share options by employees, including the Directors of the Company. Alpha was drawn £10.1m on its RCF at 30 September 2023, to assist with managing currency requirements in the period. "
The Board is pleased to declare a maintained interim dividend for FY 24 of 3.70p per share (H1 23: 3.70p), which will be paid on 21 December 2023 to shareholders on the register at the close of business on 8 December 2023.
Shareholder equity is down over £6m since year end and retained earnings are now below £1m. Dividend is looking precarious and cashflows are awful. I used to really like this business. No position but I'd sooner be short than long now.
I note Investec maintains a £6.72p target and sticks with a total div of 15.6p which isn't a bad yield.
PE of 13 based on normalised EPS looks decent value given the growth prospects, yield and net cash forecast to be £55m.
Thanks for posting. Just had a call with them myself and happy to hold and add on weakness.
I'll try and get a write up sorted in the next few days, but suffice to say all seems positive despite near term headwinds.
Importantly, Insurance side is gathering momentum and should play an increasing role going forward.
Pleased to hear that the forecast div (full year total) is on track and will mark an increase on last year.
Acquisitions still very much part of the growth story, although they remain highly selective.
Shoreline bolt-on has gone very well as expected.
This is quite a common characteristic of this stock. Never seems to affect the share price. Possible it is the short closing (GLG 0.6% short in run up to TU).
What is the reason of big volume today?
Just waiting to see if there is anything from Investec this morning.
Personally happy with the update and the now rather attractive yield.
Popping my write up from back in July for interest when I spoke with management.
As a reminder, Investec was forecasting 2024 revenue of £244m with pre-tax profits at £46.3p along with an anticipation of another hike in the dividend to 15.6p per share.
https://martinflitton1.wixsite.com/privatepunter/post/sticking-with-afm-12-07-23
Sounded ok to me. The TU did not provide the previous EBITDA margin, which proactive are reporting as 20.5%. Bit silly to say 'lower' but not quantify by how much in the TU.
Adjusted EBITDA margin was just over 17%, compared to 20.5% in the previous full year, which was attributed to reduced average utilisation, partly reflecting quieter summer months.
https://www.proactiveinvestors.co.uk/companies/news/1029202/alpha-fmc-says-more-positive-market-sentiment-is-returning-1029202.html
The 6 analysts offering 12 month price targets for Alpha Financial Markets Consulting PLC have a median target of 570.00, with a high estimate of 672.00 and a low estimate of 500.00. The median estimate represents a 75.38% increase from the last price of 325.00.
Then you look at Aviva today, rumours of takeovers for £6, when it was trading at £3.80. The IC actually wrote an article on TO targets, citing this as one.
https://www.investorschronicle.co.uk/news/2023/08/21/private-equity-buyers-coming-for-niche-consultants/
Last but not least is Alpha Financial Markets Consulting (AFM), which advises asset managers, wealth managers and insurers. Its shares sank in June over concerns that the group had taken on too many consultants too quickly and that its sales cycle was getting longer.
However, the structural growth drivers still look robust as financial services firms are forced to navigate mergers, fee pressure and ESG. Meanwhile, Alpha FMC itself is debt-free and organic sales are still shooting up – particularly in its key market of North America.
1% short, judging from the price action here. Had a few more, really like this company. Left a bit of room, as we have a trading update fairly soon, but the company is in good health from last financials, and well regarded. A few in the £2's would not trouble me at all.
Looks like about 1% of company traded today.
GLG short.
I was very greedy last week.
Amazing liquidity drain in a few high quality AIM shares last week, this had already been dropped by ~20% to 400p off the back of apparently conservative wording in their outlook statement, so to see it fall another 20% down to 315p was fairly shocking. £60m cash, trading below 7x EV/EBITDA & a >4% yield from these levels. Should see a sustained recovery through September as investors return from the summer break IMO.
Dividend to 10.50p per share, bringing the total for the year to 14.20p, an increase of 36.5% compared with the 10.40p paid in respect of FY 22, in line with the Group's dividend policy. Subject to shareholder approval at the Annual General Meeting ("AGM"), to be held on 6 September 2023, the final dividend will be paid on 19 September 2023 to shareholders on the register at close of business on 8 September 2023.
Report
https://www.proactiveinvestors.co.uk/LON:AFM/Alpha-Financial-Markets-Consulting-PLC