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Is the market excited about Biden taking on Trump?...
Well the BOD here looks like they are binding their time until the news of the virus curve has peaked and then showing signs of light at the end of the tunnel, which would probably perk up the SP .... market certainly lively today
Restaurant Group just had a book build placing at 58p, despite recent lows of 20p and after the 20% dilution the SP has climbed to 65p....and that on top of a cautious update about the rest of the year..
So...I would say placing less shares at 50p is a far better bet for investors, than placing a load more at 30p ..even to raise the same amount
Kenj
I was talking generally about comments in general here or anywhere else.....and suggesting that reading and keeping up with RNS and company accounts was often a better direction to keep focused on. ..in any forum
I welcome your opinions and have previously said so...
RI looking post Easter though ..lot of behind the scenes activity no doubt ....probably dont need it urgently so are keeping an eye on the virus,economy, lockdown length, etc etc etc...before making a decision
Maybe we have to wait for Boris to get back home ...!!
Pokerchips,
If that comment was not aimed at me then please say who it was aimed at. Only you Trickymatters and I had posted on this thread since Sunday, before you comment. As I am the only one who is less than positive about COST, I naturally assumed that it was me you referred to in your reply to Coaster. I apologize if I am being over sensitive, and have read this wrong.
" There is nothing misleading about my comments Pokerchips! "
Wtf ? ...please provide evidence I said they were ....
My only words on the matter were
" Dont let comments mislead you..."
Move up to the 40s today possibly
I am really curious as to what the terms of this fund raise will be. WH Smith had a small placing that only increased the number of shares in issue by about 14%. They placed the shares at a discount of 4% to the previous recent share price.
So if COST are going to raise £100 million (more than double their Market cap) the current number of shares that are going to be issued is massive! If it is a rights issue (based on the current price then it is going to be something like three shares at 35p for every one held by the shareholders. This would nearly quadruple the number of shares in issue!
If the rights price isn't based on a discount to the current market price then no one would take it up. See Kier for a textbook example of that..
Pokerchips
Appreciate your comments.
Kenj
I was not referring to comments on this BB particularly. I think your posts and Pokerchips generally are valuable points of view which I consider seriously.
GLA.
Hopefully more readable.
Com. ----- Feb High ----- March Low ---- Remaining value
BBY ------- 292.6p -------- 170.1p ----------58.1%
MGNS ---- 1970p --------- 1070p ----------- 54.3%
COST ----- 207.5p --------- 34.1p ----------- 16.4%
There is nothing misleading about my comments Pokerchips!
Costain's performance is dire. All the builders and construction companies have suffered during the Coronavirus period, but COST stands out. It is there for all to see, just compare their prices with other construction companies.
Com. Feb High March Low Remaining value
BBY 292.6p 170.1p 58.1%
MGNS 1970p 1070p 54.3%
COST 207.5p 34.1p 16.4%
And you don't need to be a genius to work out why COST has so massively under performed its rivals.
Coaster,
Dont let comments mislead you...just read the RNS and the company accounts.... the construction industry has been going through a difficult patch for some time, interms of margins, costs increases, etc etc and the reasons for the fund raise has been to to improve the working capital needed and move towards paying suppliers quicker, depite not yet receiving revenues from the projects themselves
The way construction operates is riskier and more complex and involves geater amounts of capital flow ....which is one of the reasons that Costain has made a move towards higher margin Consultancy and Technology know how ....
It is far more difficult to bring projects in on time and on budget especially if sub-contracting areas out..... Carillion showed are quickly a company can get itself into severe problems that become impossible to recover from
Carillion was a canary in a coalmine moment that rang alarm bells that free cash flow and working capital had to be inceased significantly in due course...
The fund raise here is more to do with embedding in a sound financial working base which will also give clients confidence that Costainmisnt going to run into trouble trying to financially mange big projects. As such I think it will actually assist them to get more tenders, as a result.
Whilst there were write downs this last year on mistakes made, at least the fund raise isnt by and large in order to repair some huge financial f*ck up...
It is not an easy sector to navigate through , but then again...none of the others are either at the moment...and it is a wonder many survive when you look at the very slim margins some sectors are working to...
I would agree with you. I like many others are in and still in around 4times the current SP.
The Fundraising came like as I have said in a previous post like a bolt out of the blue. I do believe in this company but I am far from convinced that the BOD have handled their shortage of funds correctly. Look at a sample of comments concerning Costain over the last couple of years and you will see the often repeated mantra that the company was cash rich and had very little debt.
So the fundamentals outside the roof and road issues were repeatedly stated as being sound.
I take it like others on the chin but I do have a lingering feeling of being "misled".
Multi-bag not multiday! Perils of auto correct??
I will buy again it's 30p and if it's 50p I will try to buy before the sp immediately bounces to catch up. Either way you are making money in the medium term on this share imho. I am basing my assumption on the fact that this government have announced £300 billion of infrastructure spending plans in the budget. £23 billion is relevant to Costain's core skills. This is not a crowded industry. The competition will also be just as busy. Fundraise or not this is a very good buy at these prices it will multi-day. You are banking on the company going under. Not impossible. I don't think it will happen.
WH Smith's announced a fund raise yesterday. Several small biopharmas have had successful fundraisers (unsurprisingly given the times we are in).
WH Smith's announced a fund raise yesterday. Several small biopharmas have had successful fundraisers (unsurprisingly given the times we are in).
The City is quite clearly putting the ball in the BOD hands with regards the fund raise , at present , and awaiting the release of the fund raise package
It does remain to be seen who out there will also look to raise funds during these difficult times, depsite their share price perking up somewhat over the last 2 days ...
As for "You aren't going to get in any lower than this" - I suggest you reappraise that statement after the Rights Issue.
The Right Issue price could just as easily be 50p as it could be 30p , despite tou thinking otherwise , and the performance of the SP during the Right Issue usually depends largely on the demand for the Nil-Paid Rights that current shareholders may or may not want to sell.
If the demand for the Rights is strong and the fund raise is well supported then the SP would react accordingly
"Kenj, you are making an argument to get out of any shares. People who are invested at this level are assuming that the market will recover where firms have survived. Most people who were in at £2 will have sold by now. You aren't going to get in any lower than this."
Trickmatters
In reply to your post above, which seems to have been removed.
There will have been many investors who were taken by surprise by Costain's sudden and dramatic share price fall, and I suspect that many are still in shock and holding on, not wishing to take such a substantial loss.
I am not saying get out of any shares at all. I suggested some better investments, but you pooh poohed them. Incidentally most of them are out performing Costain, but that is not difficult.
As for "You aren't going to get in any lower than this" - I suggest you reappraise that statement after the Rights Issue.
There will have been many investors who were taken by surprise by Costain's sudden and dramatic share price fall, and I suspect that many are still in shock and holding on, not wishing to take such a substantial loss.
I am not saying get out of any shares at all. I suggested some better investments, but you pooh poohed them. Incidentally most of them are out performing Costain, but that is not difficult.
As for "You aren't going to get in any lower than this" - I suggest you reappraise that statement after the Rights Issue.
Kenj, you are making an argument to get out of any shares. People who are invested at this level are assuming that the market will recover where firms have survived. Most people who were in at £2 will have sold by now. You aren't going to get in any lower than this.
"The mkt cap is already below asset value "
I doubt anyone can determine any asset value right now...you are merely looking at an historical, out of date book figure...
Companies have to amend the book figure on a yearly basis ...watch out !!!
They want a hundred million to ensure capital requirements and to ensure sufficient cashflow to facilitate 4.2 billion worth of new contracts! They have cash at hand to get through this crisis which many companies don't have. From this base this is a brilliant buy.
They want a hundred million to ensure capital requirements and to ensure sufficient cashflow to facilitate 4.2 billion worth of new contracts! They have cash at hand to get through this crisis which many companies don't have.
If the company had the money they needed, then they would not have had to announce a fundraising, and the sp would be more than double what it is now!
Absolutely Bunsenburner this is a cracking buy. Economists are predicting that unemployment will reach 6 million this quarter. Some posters are banging on about the RI and completely missing the point. This is a company that will survive this pandemic and thrive thereafter. It has the money and the credibility to survive and it is entirely well placed to be a key player in getting us all back to work with important transport solutions. 4.2 billion pounds of forward sales!