Read Arden Partners's note on PENDRAGON, out this morning, by visiting https://www.research-tree.com/company/GB00B1JQBT10 "Valuations in the UK motor retail sector have de-rated as the market speculates that the UK is reaching a mature stage of the new car cycle... Consequently, we believe the market has meaningfully underestimated the longevity of the demand cycle which, alongside the evolving retail proposition at Pendragon, presents a significant value opportunity. We continue, therefore, to challenge the rationale of modest sector valuations ..."
Continued concern on Brexit Continued concern that the market has topped out.
Take a look over the actual sector...Inchcape, Lookers, PDG, Vertu, they are all being effected by the above.
Here is where the dissapointment lies for me with PDG. Used GP only up 4.2% and onyl 1.2% in aftersales GP...
Q1 has proved to be very good for a few motor groups, these numbers from PDG seem appear to be half of what they should be.
Equaly, with volumes up for other groups, that is a very good spot hottips on actual used volumes, again some groups have had a very very good Q1 and even Q2 has started not too bad at all....Looks like PDG are not getting there share of this.
I have found it very bizarre that PDG hasve continued to sell out of the premium franchises, none more so than landrover. Given the price other groups have been paying to buy these, perhaps Mr Finn feels hes been cashing these out at the top of the market.....still looks to me like the most sought after vehicle is indeed a landrover....So I do beleive that it has been misjudged at which point these dealerships have been sold.
It almost feels like after being bitten paying over the odds at the hight of the market that PDG has retreated into its shell...Perhaps too much fear still exsists after all most going to the wall.
"with our debt : underlying EBITDA ratio remaining significantly below our target range of 1.0 to 1.5. We are currently assessing our best use of funds" Finally PDG have gotten the issue of debt undercontrol, a hell of a lot better terms than when the market crashed....yet...still....scared to spend the money...and when they do, things arent turning out as planned.
My biggest issue with PDG, apart from certain "senior" management (and regardless what you think of Trevor, he is actually a very smart man who is well resepected in the industry, something that cant be said for some of the "others", here, is simple.....Shares in CIRC...
1.5bn shares in circ. What should have happened a few years back was a consolodation, bring this back down to the 500m shares in circ. 1.5BN shares....takes alot to move this in order to get the returns you think you should get.
The sector is very tetchy SP wise at the moment because of the 2 mentioned items, once Brexit or non Brexit is out of the way, the sector will recover some traction. The second of the two , has the sector topped out, I dont beleive it has just yet. New cars Id agree, used cars, well, just keep your eyes open accross the sector, it is still buyont and there are groups taking more than there fair share at more than a decent margin. Equally, service plan pentertation is starting to kick in on a few groups as well, so expect to see encouraging results in terms of aftersales gp and bottom line. Just my tuppence :)
A reasonably up-beat statement and it does mention profitability increase on used car sales. We have to accept that this year was sign-posted as a relatively flat year for car sales. Needless to say, negative reaction so far from the Market, although to be fair the gereneral stockmarket is not in a positive mood. .I will be comforted by the dividend next month, but otherwise nursing another painful month with the capital value of my holding. Something has to give soon with the MCap below£500M. Best Wishes
Take a look through the trading update, any mention of volumes particularly in used cars is missing. this would suggest volumes are at best static and this is after opening new supermarkets ! I believed used car volume growth was the cornerstone of the latest strategy, why would you not comment?? visitors to the website is meaningless unless volumes go up with it !
Again, absolutely spot on. I originally thought, with Trevor Finn, we had a maestro (not Austin!) at the helm. But your comments would appear potentially accurate given the lack of "magic" coming from him and the Board. Trouble is this site re Pendragon is relatively dormant. With my other shares, one of which you can e-mail the MD and get a same day reply!!! Worrying as near 52 week low, I believe touched this morning. I appreciate the sector is under a bit of a cloud, but at £500M this would be a snip for a break up specialist. I am happy to work with you hottips to try and get some kind of communication from the Board although the AGM notes should be digested first. Best Wishes.
The chief executive, Trevor Finn, obviously agreed with your "happiness" at 49p, he sold 4.5m !!!..... before the price tumbled and will now , once again, be granted more shares at the lower price as an "incentive" no doubt . It is time we all woke up !
I was "happy" when the share price hit 49p in January, perceiving that the market was re-rating this share and why not? Good profits/Debt lowered/Increasing dividends. I can't get to the AGM as I live in Kent and my shares (200000plus) are within my SIPP. I retain the feeling that with a MCap of around £500M, there must surely come at time when someone gets interested. I know Odey is involved (I think), but I think Jack Peachey sold his holding. I don't really know. However this cannot go on for much longer. Nevertheless Inch and Look also suffering. Best Wishes.
Same here, I have been in for a long time and it consistently fails to make progress,which is why I am watching closely. The most annoying thing is the top level remuneration constantly being approved with diabolical performance in market price/cap and investor returns that are way below average over the last 5 years. I see little to convince me that this will improve any time soon. I am surprised the big boys are not pushing for changes in leadership. I cannot find out who is specifically heading investor relations which probably means there is not anyone directly(telling in itself) but the Chairman in Melvyn Egglenton (yes he is the guy who was a partner at KPMG, Pendragon auditors at the same time as being a non exec !! KPMG heavily fined last year !!) and the Chief Operating officer is called Martin Casha
Excellent work by you with this information. Clearly this is a worry. If you are going to sport the title" UK's biggest car dealer" then you need to have the dynamics to do it, rather than a Arthur Daley approach. I would suggest someone ascertains the key person in Investor Relations at Pendragon to tell us what is going on. I am happy to find names, but I am not well versed in the industry speak, as your contact might be. I am just another "poor bugger" who invested at 80p!!!
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