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Agreed. Though this cash pile has been building pretty much since IPO. On the one hand it's frustrating to have relatively muted dividends, share buybacks, and small M&A activity. As a shareholder I want them to be a little bolder - if they're not looking to make a big acquisition that's accretive to returns going forwards then they should return cash to shareholders in the most efficient way possible (probably a really big share buy back program -> offer to buy 30% of the outstanding shares etc). The alternative explanation/consideration is that Plus500 takes on a lot of risk by being the counterparty. As active customers and potential position exposures increase Plus500 has to have more and more fire power on hand to hedge in case of overexposure. Unfortunately this results in dead capital that can't be deployed, though lowers the inherent risk (risk of shareholders losing all their money) in the investment. It would help if management could provide clarity as to why they think they need so much cash? Start with: How much is for hedging potential exposures?
Makes you wonder what they have in plan for that 722 Million USD in the bank. Must be earning next to nothing in interest and we are only getting 50 % of profit after tax so the cash pile will continue to grow.
Excellent results ,ahead of expectations & should volatility return,as expected by many commentators,we should benefit further-apart from the potential for our US "bridghead" acquisition resulting in the potential for substantial US growth.
A positive outcome over a period of market stability.Should markets become less stable,as predicted by many, we should prosper & our "bridghead"US acquisition should also prosper.
(Reuters) -Online trading platform Plus500 (LON:PLUSP) forecast annual revenue to be "significantly ahead" of analysts' estimates and reported a lower first-half profit on Tuesday as trading levels normalised from record volumes in 2020.
looks like your 10% is coming ,
GBX 1,547.50
8.25%
+118.00
good start
GBX 1,483.00
3.74%
+53.50 Today
Aug 17, 8:04:32 AM UTC+1 · GBX · LON · Disclaimer
Stunning results , year end to significantly exceed expectations , huge divi and share buy back. Sp should add 10% imv today.
PLUS has its ups and downs but is on an uptrend since early 2019. Shorts are nil. Modest target of mid 1500s from PEEL HUNT seems reasonable in short term. Very attractive dividend. If US venture has legs we are in a good position. But then again - what do I know.
Very much same same as you Oi Oi
It's all to do with visibility NLondon. CMC/IG are tremendously visible.........Plus500 isn't -and the directors of Plus, in the past, have not exactly done the right thing (as far as the markets are concerned). They are deliberately unnecessarily obtuse, as far as the market is concerned.......and therefore they will always be a lag, however gangbusters the performance is, to their peers. Unless they change of course (domicile in London would be a good start, rather than Israel). Just my two-penneth - others can chip in with their thoughts too of course.
Cmc are on a tear lately sp wise.Are plus500 innovating in terms of products?Do they do bitcoin products?The market doesn't seem to like 500 too much anyway it seems.
I think they'll acquire more US businesses to grab some momentum there instead of the buybacks. I am not even going to try and explain the share price fall recently......but Plus500 is not seen favourably by the market, for a lot of reasons (that have been repeated on this board in the past so not going to go over the same ground). What I will say is this; nothing on those fronts has changed....and therefore, the people that can make the share price move has not changed either.
I was fortunate to first buy just after the IPO @ around 130p & have sold & bought back since most recently around the current price & my decent holding (for me) stands me in at substantially less than zero-& that excludes my total dividends .I have no complaints & will buy more on any further weakness ahead of Interims,the Interim divi declaration & the likely announcement of more buy backs,unless we more aggressively pursue growth by acquisition,which would be a good thing .
Just doing some quick and simple math here - this company had $594m cash on 31/12/2020, in H1 they probably made 50% of the reported Customer Trading Income at $379m, which should equate to lets say $190m but they will pay a dividend of $85m tomorrow - so $594m + $190m - $85m = $699m of cash at the moment, while market cap at the moment is $2bn. Substracting the cash $2bn - $699m = $1.3bn, while they are very conservatively expected to make $200-250m a year of profit (but made more than $500m in 2018 and 2020, and could be on track to make $350m this year). So this gives a cash-adjusted PE ratio of 5.2x-6.5x conservatively, and optimistically 3.7x, while a 2020 repeat with annual earnings of $500m would mean a 2.6x valuation. This is a tremendously cheap valuation, together with growth opportunities in Plus500 Invest and the US expansion does look very attractive from my point of view, while I the share price keeps falling to my bewilderement.
Replying to Texas Pete it does not bode well for the jobs of the analysts who have consistently had stupidly low estimates. What planet are they on? It is just the planet that takes management guidance not common sense.
We must be on a per of only seven or less for this year and taking the cash out of the equation the business must be valued at way less than this. Incredible.
H1 dividend should be higher than expected so glad to have bought more last month .
Interesting to see whether our US acquisition proves to be a decent bridgehead into the US market as substantial growth could arise in US
Pete , agree at q1 update the expectation for full year was only 454m . Current run rate gives a figure over 700m and key question is will the sp also rise 50%? I doubt it but do expect a decent reaction!
H1 revenue in at $379m, market expectations for the full year are $521m, so this bodes well.