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Two RNS’s aw. 1 re shareholding and the second TRG appointment to board. I have not looked back, is this their only appointment or an additional appointment? This is significant as the timing cannot be ignored.
Bee/BigB.....unless I am mistaken I didn't read this as a proposal or intention to acquire further shares, but as a notification of intent to appoint an independent member to the Amigo board to represent The Richmond Group interests....there is mention of the companies senior loan debenture notes but I don't understand the relevance of this...
Had a quick look Bee - activist investors - interesting.
see the RNS we acquisition of shares?
Thanks BigB....your response re the high street lenders is probably right...to them ,. a small segment of the market with too high a risk of negative press...you have also made excellent points about public perceptions and impact on funding sources which I hadn't factored in ..yes there is a toxic nature to this product , which without doubt has resulted in real anxiety, anguish and anger in certain percentages of borrowing ...in fact reading individual cases you can see that thoughts of suicide by individual investors have occurred...in this regard I too have my apprehensions about seeking to profit from this sector... Regarding your fear about institutional investors withdrawing , this might already be happening...if you ignore Woodfords 4.99 % stake which will probably be liquidated as soon as, then institutional investors appear to hold less than 6% of the stock..although it isn't clear where the rest of the 110 million shares sold last week went to.
The underlying fundamentals of the business as you say are very sound, which is what swung it for me to invest, (immediately after the 50% fall in share price) after the 1st quarter results were published .and I agree that based on current actual complaint levels, the fall in profitability in no way justifies the ensuing fall in share price , making the share vastly oversold...the first quarter ended in June though and a long time has now elapsed without any update , so the contents of the interim results a week today will be extremely important...half year accounts are frequently a place to announce substantive bad news items and subsequent rebasing of dividend policies...I offer no prediction here, other than observing the downward trending share prices which have been taking place in the run up to their release...
Thanks aw, I do not see the High St banks as a particular threat to this market - they do not need the hassle. I believe our biggest threat to be public acceptance of the need for facilities such as AMGO’s. If sentiment went against us by which I mean that it became toxic to be invested in the market sector then Institutions would flee, funding would dry up and even we as individual investors, who I am sure approach this with some degree of anxiety, would find it difficult to invest then AMGO would quickly become a private enterprise which would, in my option at least, not be in the best interests of the borrower. Whilst it is certainly a little unsavourily I believe the Regulator needs to maintain a soft touch to ensure that companies can operate efficiently and profitably whilst at the same time being under the full glare of public scrutiny via a listed platform. I am confident, especially given the BOD’s confirmation that they are remodelling the business that AMGO can do the job properly and I look forward to the results.
Thanks BB for a very well thought out and reasoned opinion..your classification of the person who goes to Amigo has hit in on the head... I think that all of these complaints now are probably legacy issues going back to the ramped up pilot lending they did just before flotation to increase the flotation price ..Visiting the 'trust pilot' website and looking at recent reviews, and looking at the Amigo website itself and looking at the tone temperament and access they give to complaints does suggest they are keen to learn their lessons..
I take on board your comments regarding the small number of complaints at present but as we all know ..negative word of mouth is ten times more powerful than a compliment..
I guess that going forward a lot has to do with the views of the regulator...and whether they choose to show their teeth and impose fines as they have proved willing to do in the past....it is reassuring that Amigo appears to be working very close with them on this...
You are spot on about Amigo filling a gap in the market place...our biggest threats remain the high street lenders re-entering this space, or a new entrant coming in and significantly undercutting Amigo on APR but just creaming off the higher quality of Amigo borrowers...
Well aw, I have looked at the Debt Camel site as you suggested, it makes interesting reading and as they even provide templates for the disgruntled borrower and guarantors you can understand why people are pressing their luck and having a go at making a claim - I have mixed views but I don’t think I can bring myself to blame them as a win would make a big difference to their lives. I think it comes down to the price of doing business in this particular market and the skill is balancing a speedy process against the requirement for due diligence. I was myself involved in writing one of the first credit scoring systems for a major lending institution back in the mid 80’s - it was not rocket science but the fundamental basis on which a decision was made was the ability and willingness to repay. Back in my day a CCJ meant you had no chance but the market has moved on and like it or not AMGO’s customer base will fall into the category of high risk, probably having proved in the past that they have had loans that they have failed to repay without court involvement. If they could get finance from a high street bank then they would and would not be paying the 48% APR that AMGO charge. AMGO are looking for customers at the level that are not credit worthy enough for the banks but higher than those enslaved to the payday lenders who themselves represent a better proposition than a back street loan shark. AMGO will not get it right all the time, they will want to keep the administration process to a minimum and will make mistakes, those mistakes will cost them, the skill is to do enough things right to produce a profit and provide a service that remains on the right side of the law and ultimately ethical to the hard pressed borrower. Legislation will and I would say should get tighter but whilst there is a market need AMGO require a model that provides a service with the least exploitation to make the venture worthwhile having due regard to the risk. Increased regulation is a barrier to entry and solidifies our position as market leader. I note that AMGO have 350,000 customers so the 400 successful complaints upheld by the ombudsman represents 0.11% which does not feel unreasonably high. I have added a few more today. ATB
Yes BigB. I agree with you there ..once the results are published next Thursday the text regarding the business outlook and the dividend policy will be a key feature...
My policy is to get in on a 50% or more fall , make a quick gain on a bounce and get out again ..but I got in at 74.5p and there was no real bounce so am down over 20% at present and may have to hang around for a little while . I am hoping for good news but am prepared for a downbeat assessment ..
Well aw, it’s telling me to buy because it is oversold.
Hi...thanks for your valued comments and as always j find myself nodding in agreement with what you say..Also look though at Amigos own complaints data page on its website and you will see figures of around 3,700 complaints in the first half year with 35% that Amigo themselves upheld...it's possible that only then, will those who had their complaint refused, go to the ombudsman ...of course these complaints might be different in nature such as complaints of rudeness or poor service etc...yes I am eagerly awaiting the results like you....A current PE ratio of 3 and a dividend yield of 16% is usually the sign of the market telling you something...let's hope this is an exception...
Hi aw, good evening. I have not yet had the opportunity to look at the site specifically but I get a totally different feeling from the figures you provided earlier. 240 complaints 83% found in favour of client is 200 for 6 months that is 400 for the year, again I admit that I do not know how many loan agreements they enter into but to generate the turnover it must be many thousand, therefore a very low and in my view acceptable level especially as the regulator and sentiment will be in favour of those complaining. To do business in this market comes with risk but it also produces a significant profit, achieving the right balance is what makes a good business - I believe that AMGO is one. Fundamentals are strong, BoD aware of public and regulator sentiment and are adjusting the model to reflect this, current SP close to results and anticipated dividend provides an opportunity - I am adding so I am feeling confident, we will soon find out if this is misplaced or premature. ATB
High BigB...good to see you again...yes the fundamentals appear sound...suggest though that you just Google Amigo complaints...you will get several threads showing a growing awareness of debt problems identified by management charities, (see debt camel) and claims companies all drawing attention to the significant loans Amigo made with little or no regard to ability to pay...the 1st quarter results said that the ombudsman was upholding more complaints...actually the figure is 83% of them and the claims are growing at an alarming rate.. I hope Amigo isn't seen as the next target after Wonga and Quick Quid to pursue...
Interested to hear your thoughts..
Wow..the share price finished higher today for the first time in two weeks...
Well for better or worse I have increased my holding again today, now having a little over 100k shares. I am hopeful of positive results and a good dividend, the BoD need to do something positive and significant to reassure shareholders. I would like us to remain listed and push back into 250 but worst case a buyout which would be a bargain on fundamentals at £1+. Your money, your call.