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Beev..having read up on Amigo and Debt Camel and the Financial Ombudsman service you are right to be worried about the regulators...customer complaints against Amigo have increased quite considerably ...currently around 240 for the Ist half of 2019 and 83% of complaints resolved were in the customers favour with refunds of interest and interest of 8% on the refunds being required...their £2 million provision might well have to be significantly increased going forward...This is a worrying trend.
i don't really buy the taking it private thing, you would lose access to a good source of fund raising and it would likely damage a delicate reputation. Whilst there are obviously benefits for buying the remaining 20-25% on the cheap my focus would be on the regulators at the moment regardless
Sorry Yuri I forgot to add that on 11th June the share price was £2.87 and the Richmond holding was valued at £800 million...that was probably why they wanted to sell at that point....now the share price is £0.585 and their Amigo holding is only worth £198 million....would you be selling at this point or trying to buy back the remaining shares and take it private again..
When Amigo was floated at 2.975 the founder became a billionaire on paper and entered the richest 100 people of Britain list...he wasn't on that list for long , based on the share price performance since then...
Hi Yuri....Google major shareholders of Amigo loans and you will see the FT factsheet detailing the major shareholders...they are Woodford Investment management with a holding of 4.99% and 9 other I.I's with further holdings of around 6% in total...
For some reason The Richmond Group don't appear on the list..don't know the reason why not, unless for some legal reason they are not classed as a major shareholder or Investment institution ..
Woodford? Formally there's no Woodford anymore, their different assets managed by different managers.
Also technically they're below 5% threshold - therefore if I'm not mistaken don't have to report what's going on there on a background, I think there's quite an ambiguity on statement "they still hold 4.99%", especially considering huge volumes being moved weekly very close to those 4.99% forth and back off-book.
Private? This card being played on every second ticker on this forum, hardly works these days, may be only on noobs.
And taking into account what in jun/jul there were news circulating about majority holder wanting to sell their lot.
Closing this segment of lending market? hmm,.. and where would all this demand go with so many players out of the game and economy conditions deteriorating (income falling) ? Banks are not lending them for a reason, these clients borrow in this niche for a same reason.
Yes agreed, let's wait and see...
Out of 890,000 share sales today , almost 500,000 were after 4.30 at a surpressed share price .this is proving a regular trend...
Yes the half year results are due a week on Thursday...let's wait and see if there is a helpful and complicit negative spin put on them..
Hi Mike..
I agree with you that the fundamentals as at Quarter 1 will support the current dividend...Can't help thinking that they will use the half year accounts to unleash a raft of large provisions so that they can attempt to bury any bad news alongside the events in the wider sector and choose this time to review the dividend....Yes Woodford yet to sell here...don't understand why he didn't at the last fire sale...clinging on possibly ?
My mind is still locked into what BigB said on here about a week ago about keeping the selling price artificially low and gradually reducing it, till there are no optimists left, then executing a deal to take it back private again...at a much reduced price...
Why wouldn't they do that given their dominant stake, or are there any safeguards in place, on a real time monitoring basis, to prevent it ?
The SP ended lower again today ..must be about the tenth in a row...not substantially , more of a slow but steady trickle ..This share has been selling off steadily since the recent high of 80p ...with no bounces..
Aren't you worried by that Mike ?
a company that charges 2000% interest IS NOT a peer of a company that charges 50% interest, on that basis we are closer to Lloyds and Barclays, that's what makes you more-wrong...
HAT was an over reaction, but a bit like amgo it is not the most liquid of shares. I have held HAT for quite a few years selling a bit or topping up with the ebbs and flows of the price. Managed to almost double my holding @281 today which I think will be seen to have been a bargain by next year.
Yes, I'm short. The whole sector is a car crash. Friday it was NSF, today HAT. I'm not a moral crusader but it preys on people who are hopeless with money and desperate for fast cash. The government and FCA are quite rightly cracking down on the industry. Two industry peers have gone bust, clearly this type of business is flawed. If you disagree with me, I encourage you to look at the chart. Clearly the market definitely agrees with me and vehemently disagrees with you. As someone said below, everyone holding stock in this company is sat on a loss. Why does that make me the moron and why is MTC relevant?
looking at your other posts f15jcm one would have to question your intentions, you clearly have an agenda to short a number of shares
Why did QuickQuid and Wonga both go bust? The answer probably lies there.
That's like saying why did Mothercare go bust. Morong
Why did QuickQuid and Wonga both go bust? The answer probably lies there.
Mike H...Woodford still holds 4.99% of Amigo... There was 20% of Amigo held by institutional investors until last week before Invesco all but pulled out , now only 10% of Amigos shares are held by Institutional investors..it is worth noting , however, that none of the other 9 institutional investors liquidated their holdings...that does though pose the question..where did the other 60 million shares that were sold on the day go to and for that matter, who bought Invescos shares ?
For some reason the shares held by the Richmond Group don't classify as institutional holdings and don't appear in the lists of major shareholders from what I can see, unless you can enlighten me .
Yes the sector is out of favour but Amigos share price is well undervalued on any fundamental basis , based on information currently in the public domain so I cannot hazard a guess as to what is really happening underneath it all...what do you think is happening Mike H or anyone else on here ?
*realises
HAT 16% down on the day. The sector is totally uninvestable. Talk of making 100% gains only supports my position, the market is pricing it so low because it releases it's only going one way. A positive update is extremely unlikely IMO.
I assumed it was a rogue post so I didn't bother to reply.
The worry I have with Amigos trades is whether there is an organised and orchestrated move downwards in price to make existing shareholders pack up and sell.
My reason for saying this is that Anyone who has AT ANY TIME bought Shares in Amigo and held on to them has lost money ..the minute the share price moved upwards a sell happens to bring it back down again to its lowest (and declining) price levels.....I hope I am wrong...
if it delivers that in the update at the end of the month i'm getting triple digit returns.... hell yeah baby! :)
Agreed. You just need to read 1st quarter results RNS to find the proof....excerpt taken from the RNS as below:
"We remain a highly profitable business with high returns on assets and strong cash generation. Our diversified funding mix gives us a strength and flexibility of balance sheet that places us in a strong position to take this business forward and capture the strong demand for our product."
NSF is an unprofitable dog with unreliable management that failed in a bid to takeover PFG.
Couldn't be more chalk and cheese
NSF having a shocker today, specific mention of weakness in guarantor loans. Will come as a surprise to no one if Amigo goes bust.
BigB...the share price is still trending downwards...at a lower rate than before but it is still happening...your "follow the trend" principle has applied in this instance, can you see any reversal occurring ?
Points taken Yuri and you might well be right .
Obviously 0% would send them into administration , and at the other end of the scale , charging 1000% would send them into administration too as evidenced by Wonga and Quick Quid , so the optimum interest rate lies somewhere in between..For me a one size fits all interest rate for all borrowers is a bit of a blunt instrument and so could be adjusted to reflect the relative status of the guarantor , as in whether they are a homeowner, tenant etc ..like some of their competitors do...I agree though one rate is simple , easy to understand and profitable..it's whether a lower rate would be more profitable for the reasons explained..it's obviously a debateable point and I don't feel too strongly about it.. You can't take away the fact that Amigo already holds the lions share of the market so they can't be doing that much wrong.
Take a look though at the "Laffer curve" as applied to the optimum rates of income tax that the U.S. computed back in 1974 under the Ford Administration, which would earn the government the most tax revenue.. It is an interesting theory that worked for them at the time ..I don't know if it is still being used..
aw - yes, your strategy might be quite a good way,
reducing variable/associated costs is very popular path, let's minimize it all the way down to zero (I won't comment on what happens to revenue, especially taking into account what current equity is below sp/capitalization, at least in previous report).
On a serious side - they normally do operate in a right range of relative sensitivity balance between revenue/cost relevant to this market segment capacity and competition.
Market conditions do deteriorate - that's the fact (for whatever reason : Brexit or world economy/trade etc) and as you've mentioned potentially higher demand for quick loans (due to squeeze in income) is being hit hard by impairments and strong regulatory pressure + negative publicity / image on a whole sector (waves fom recent administrations still bounce around).
In short: they are very likely already operating on a reasonable optimum.