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AS - what makes you say “activity from core business should be in high demand” when questioning the acquisition strategy?
How do you know it isn’t in high demand? (You don’t).
From the 23/02 RNS:
"We have continued to perform well across the group and our outlook for the full year remains unchanged. This will extend our strong financial track record of growth, through a combination of organic and acquisitive investment."
Note “combination of”. We’ll only know about performance when the company issues formal updates to the market.
Ftseexplorer, in common with you, I share concern on the expansion of service through acquisition policy when activity from core business should be in high demand.
Another distracted purchase which MIGHT be beneficial in the decades ahead but WDIK? I guess that investors will discover more once results are published and the notes which accompany can be subject to scrutiny. Some accountancy business tend to use weasel like tactics to conceal information
Looks another nice fitting bolt-on. BEG has built quality and scale organically and via value-accretive deals: buying Banks Long & Co ticks the box
Equity Dev holds its forecasts until FY trading update, expected later this month, and retains its 175p/share fair value. Read in new note here, free access:
https://www.equitydevelopment.co.uk/research/acquisition-extends-property-division-footprint
Out at 131.77p. I'll be keeping an eye out and getting back in on any dips.
I'm not aware BEG has been subject to a takeover offer but I believe consolidation in this mid market financials space is inevitable. Maybe you are thinking of K3 Capital who were also NW based but were bought out recently?
I'd been watching these for a while and took a small position at 116.9p on 6th April.
Hoping for a rebound towards 130p but if it stays flat I'll be out again.
It could be the yield. I have a few shares where I could lower my average, but why buy a 2 - 3% yield, when you buy can 8 or 9. If I was invested here and had profit, I would sell and put the money in something better yielding, possibly a savings account. I think this explains why good companies are lagging. I hold a lot of BEG, but under water so stay put.
I note that the number of business insolvencies continues to increase with 2,457 filings in March. Odd that the share price should continue its southbound trend. Rather ruins my logic based approach to picking winners. (eg, buying shares in carpet companies after flooding)
This share does continue to defy logic - down 3.2% in a market that is up 1%.
I subscribe to Business Sale Report which shows the liquidations and administrations on a daily basis and I am surprised how few Begbies are winning.
The notable one is Paperchase and when they do come through they are profitable but I wonder if Begbies are actually increasing market share as a result of their aggressive acquisition strategy.
SP seems to have perked up in the last few moments
‘Tipped by MF, Is that a warning? Harwood Cap pulled out as did PS. Naked trader is still in. Anyones guess. Is looking cheap again but interesting comments from Gervais. Not Ricky
…..by Motley Fool over the weekend.
Clearly something the market doesnt like about this stock. Stockopedia seems to thinks the valuation is a bit on the high side. The businesses seem to be fine. Could just be the current sentiment. I think everyone has a finger on the trigger to take any profit smartly off the table unless outperformance is on the cards and beg seem to trade mostly in line
another attractive add-on deal for BEG as it buys surveyors/property auction firm Mark Jenkinson for £0.4m cash. Bolsters the Group in S Yorks.
This week's research note covers both BEG's organic and deal strengths, after a positive Q3 report:
https://www.equitydevelopment.co.uk/research/positive-q3-forecasts-on-track
Link to research note: https://www.equitydevelopment.co.uk/research/positive-q3-forecasts-on-track
BEG’s positive third quarter update (to end January 2023) was another confirmation of the inherent resilience of a broad services offering which includes business recovery, financial advisory, and property services consultancy. The detail included continuing good levels of new insolvency work, particularly administrations, and market share appears to be building.
The overview is encouraging. Business recovery & financial advisory trade in line with expectations as this division works through a good pipeline of engagements. Property advisory & transactional services division is also performing well and in line with expectations. It is supported by resilient income streams and a continuing flow of new instructions.
Recent UK Insolvency Services data tracks growth in the market overall and we note that numbers flattened out somewhat over the last couple of months and administrations remain below historic levels. That broadly matches our view and the assumptions for our forecasts, which anticipated a long haul rather than a rapid recovery.
BEG’s Q3 financial performance was in line with the first half and the outlook is unchanged. The statement expressed confidence regarding delivery of full year market expectations and on that basis we have maintained our full year forecasts. Our existing 175p/share fair value is fully underpinned by the outlook for organic growth.
I suspect some of the hold back could be about balances becoming due on performance reflated acquisitions. It’s just becoming very repetitive this rise and fall back. True of many other stock that have sound businesses but weak share prices. Nature of the market at the moment
I watched the presentation, and noticed a few high profile administrations mentioned.
Here a few links from the names mentioned. Interesting that Covid is still a factor in several of these cases. Major benefit of these (to Begbies) will be seen in H2.
https://www.constructionenquirer.com/2022/09/08/roofing-giant-avonside-goes-into-administration/
https://www.gamblinginsider.com/news/16717/metropolitan-gaming-completes-purchase-of-park-lane-club-london
https://www.bbc.co.uk/news/uk-wales-63349681
Begbies Traynor Executive Chairman, Ric Traynor and Group Finance Director, Nick Taylor, present interim results for the six months ended 31 October 2022. A strong first half performance and confidence in the full year outlook.
Watch the video here: https://www.piworld.co.uk/company-videos/begbies-traynor-interim-results-presentation-december-2022/
Or listen to the podcast here: https://piworld.podbean.com/e/begbies-traynor-interim-results-presentation-december-2022/
The rns didn't look to good to me and the market thinks the same. How many times has this share attempted to break and hold 148 in the last 6 months? about 20 I reckon. Extremely frustrating.
Another strong half reflects the benefits of an increasingly diverse base of cyclical and counter-cyclical revenues, built progressively via a series of strategic acquisitions and organic investment. The double-digit revenue and profit growth delivered by both divisions in H1 puts the group on track to achieve full year forecasts. The detail reveals consistent growth derived both organically and from a series of acquisitions which have added to the breadth of professional expertise and BEG’s coverage of its key target markets.
We have held our full year forecasts and plan to review them when BEG reports its Q3 trading update in late February 2023. Our current estimates underpin a retained 175p/share fair value, with upside potential if UK insolvencies, particularly administrations, continue to gather momentum, and the group secures further acquisitions which continue to build expertise and capacity. We have reflected on BEG’s rating vs the broader market and its intrinsic value vs its peers in this note.
https://www.equitydevelopment.co.uk/research/resilient-income-streams-drive-h1-result
Hard to trade this share with 5% spread!!!!
A confident update on H1 trading with revs seen 12% higher and PBT up 13% to £9m.
Equity Development still regard the group as very well placed against a difficult economic backdrop, retain FY forecasts and their 175p/share Fair Value. You can read new research note/listen to summary here (free access):
https://www.equitydevelopment.co.uk/research/strong-h1-with-double-digit-revenue-profit-growth
Good interview this with former fund manager and analyst Ken Baksh. HIs take on the economy is worth a listen too.
https://youtu.be/XbHW94Q7PR8
Reckon BEG is in the correct business and I don't think we'll really see a recession in full swing till 2025/26...but the storm clouds are definitely forming..
https://www.cityam.com/exclusive-over-50000-small-businesses-in-london-collapse/
Seems clear to me that the mini-budget has set things up for a substantial hike in minimum lending rate from Bank of England. I am not an economist, but it seems to me that the best way to reduce inflation is to improve the supply side.
Don't see much incentive, if that is the case to invest in people, research or expansion. Anyway, with a rapid increase in interest rates, it might just have the effect to pile pressure on small (50+ employees) and medium (250-10,000 employees) enterprises.
We all know that new governments are not voted in but old governments are most certainly voted out. I wonder when the first calls will be made for no confidence.