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Repost
In this post 29 May last year I said:
'In the cycle of things, CPI will probably raise debt end of 2023 for new initiatives, perhaps even under new, post transformation management' ....If we knew it then, why is the market being so hard now?
Underlying business performance is still on track.
Must be more to do with liquidity, interest rates and inflation and analyst spreadsheets than the business performance
Both interest rates and inflation will pause or reduce sometime soon imo. We said in this post the SP would then go up.
I think £1+. Then I will finally be able to afford a 'modest' yacht and pay for berthing fees with a modest dividend.
Its unstoppable imho.
In this post 29 May last year I said:
'In the cycle of things, CPI will probably raise debt end of 2023 for new initiatives, perhaps even under new, post transformation management' ....If we knew it then, why is the market being so hard now?
Underlying business performance is still on track.
Must be more to do with liquidity, interest rates and inflation and analyst spreadsheets than the business performance
Both interest rates and inflation will pause or reduce sometime soon imo. We said in this post the SP would then go up.
I think £1+. Then I will finally be able to afford a 'modest' yacht and pay for berthing fees with a modest dividend.
Its unstoppable imho.
It's about time it starts moving towards 30
@cashola, aimho :-)
@Cesna, excellent post. Thank you.
reposted to correct typos
@cashola, 'Barclays revision'
You could say the net asset value on the balance sheet is its 'realisable value' if you sold those assets at the balance sheet date and, in a perfect world = the market value/ SP.
All things being equal, inflation reduces the future realisable value of those net assets and this is reflected in a lower SP.
Very low interest rates inflate the value so if interest rates rise, this will be reflected in a lower SP.
Earnings growth increases the net assets/ realisable value and, as CPI is growing its earnings, so the SP should increase for this component.
Inflation is reducing the value of all FTSE company net assets. However, CPI is growing earnings and it will increase net assets at a faster rate than some other other companies because it is also clearing debt from asset sales, so the SP should increase for this component and may carry CPI back into the FTSE 250.
Each incremental contract win confirms earnings growth and the SP should increase incrementally.
In H2 there is a 25%+ reduction in debt/ increase in net assets and the SP should increase significantly.
In 2023 it is expected CPI will sell the Public Services division and clear all debt and so the SP should increase materially.
In 2023 it is possible inflation will have peaked and may have decreased materially so the SP would increase significantly.
In 2023 earnings growth should be motoring having already demonstrated growth in 2021 over 2020.
While interest rates are likely to be higher in 2023, the impact on SP will be offset by the benefit of lower inflation and earnings growth.
In the cycle of things, CPI will probably raise debt end of 2023 for new initiatives, perhaps even under new, post transformation management.
Not very, if at all imho
reposted to correct typos
@cashola, 'Barclays revision'
You could say the net asset value on the balance sheet is its 'realisable value' if you sold those assets at the balance sheet date and, in a perfect world = the market value/ SP.
All things being equal, inflation reduces the future realisable value of those net assets and this is reflected in a lower SP.
Very low interest rates inflate the value so if interest rates rise, this will be reflected in a lower SP.
Earnings growth increases the net assets/ realisable value and, as CPI is growing its earnings, so the SP should increase for this component.
Inflation is reducing the value of all FTSE company net assets. However, CPI is growing earnings and it will increase net assets at a faster rate than some other other companies because it is also clearing debt from asset sales, so the SP should increase for this component and may carry CPI back into the FTSE 250.
Each incremental contract win confirms earnings growth and the SP should increase incrementally.
In H2 there is a 25%+ reduction in debt/ increase in net assets and the SP should increase significantly.
In 2023 it is expected CPI will sell the Public Services division and clear all debt and so the SP should increase materially.
In 2023 it is possible inflation will have peaked and may have decreased materially so the SP would increase significantly.
In 2023 earnings growth should be motoring having already demonstrated growth in 2021 over 2020.
While interest rates are likely to be higher in 2023, the impact on SP will be offset by the benefit of lower inflation and earnings growth.
In the cycle of things, CPI will probably raise debt end of 2023 for new initiatives, perhaps even under new, post transformation management.
@cashola, 'Barclays revision'
You could say the net asset value on the balance sheet is its 'realisable value' if you sold those assets at the balance sheet date and, in a perfect world = the market value/ SP.
All things being equal, inflation reduces the future realisable value of those net assets and this is reflected in a lower SP.
Very low interest rates inflate the value so if interest rates rise, this will be reflected in a lower SP.
Earnings growth increases the net assets/ realisable value and, as CPI is growing its earnings, so the SP should increase for this component.
Inflation is reducing the value of all FTSE company net assets. However, CPI is growing earnings and it will increase net assets at a faster rate than some other other companies because it is also clearing debt from asset sales, so the SP should increase for this component and may carry CPI back into the FTSE 250.
Each incremental contract win confirms earnings growth and the SP should increase incrementally.
In H2 there is a 25%+ reduction in debt/ increase in net assets and the SP should increase significantly.
In 2023 it is expected CPI will sell the Public Services division and clear all debt and so the SP should increase materially.
In 2023 it is possible inflation will have peaked and may have decreased materially so the SP would increase significantly.
In 2023 earnings growth should be motoring having already demonstrated growth in 2021 over 2020.
While interest rates are likely to be higher in 2023, the impact on SP will be offset by the benefit of lower inflation and earnings growth.
In the cycle of things, CPI will probably raise debt end of 2023 for new initiatives, perhaps even under new, post transformation management.
p.s. Should analysts be raising their target sp's to reflect the rate of inflation at all?
I think they reduced it to reflect the fact we dropped out of the FTSE 250 - I’m still very happy with an overweight rating and 65p initial target - once we get closer to that they’ll no doubt revise it up further
My speculative theory just for fun. Barclays revision is troubling if based solely upon inflation. To go from 80 to 65 is about a 19% reduction. Whereas, they could have kept the 80p and said that money may be worth 19% less. Instead there is the double-whammy of 19% reduction of target sp and possible 19% devaluation of money equating to knocking off about 38% or about 30.5p from the 80p resulting in 49.5p near term. dyor.
Market makers sets the prices and moves the price. They don't care about brokers or what charts say. They'll move the price how they wish. Hence why 95% of investors loose and market makers win. U just have to look at today's price and barclays note as u said was issue in march to understand my point... imho
Barclay’s updated their fair value target just recently in March
They have an overweight recommendation and 65p target
Since broker announcement, share price had gone down even way before inflation n macro issue came into the fold. Goes to show. Brokers are no different to any investors here predicting where the share price would be in 12 months time...when this was at 48p, most people predicted it will hit 70p even the brokers and here we are seeing realisation v optimistic dream right before you imho
Barclays had a near-term overweight 80p target before inflation became prominent, but for cpi, it seems that inflation is relatively a non-issue. The compant appears better placed than it was at the time of the Barclays 80p target. dyor.
I wish but whatever people think/expects or belive where this should be. The fact is it isn't. Market makers and the algo will decide hence why 5% win on there investment and 95% loose imho .
£4 by year end if planned imho