Tate & Lyle Share Chat (TATE)

Certainly going for gold today.

DYOR

Price 730
Bid for takeout 850

seems to be overlooked but great to trade.

2022 has £8+ all over it with a few pullbacks along the way.

TATE has got a few things going for it. There's this sale of underforming assets, with proceeds being used to redress the balance sheet and reward stalwarts such as our good selves. It is also a defensive stock in times of inflation. And it has invested in a tiny outfit that is perfecting the use of enzymes to speed the processes of production.
I bought at 668 and am hopeful.

Nice rise so far. Any news?

TATE IS GOING to be THE HOT stock for 2022

Thanks for the link - 5 shares I hold - let us hope Sophie is right and the 2022 party starts soon.

Tate is a great income earner for me and also price spikes allow the opportunity to average down.

Expect TATE to trade to £6 and £8 next year plus the dividend. It will be an adder. Works great for me.

Interested in action before and after business disposed and the growth potential of remaining business could make TATE a racey stock.

An investment case put forward by Hargreaves Lansdown.
https://www.hl.co.uk/features/five-shares-for-2022

Opened my position here at the end of Nov at 669p and will look to add on any irrational market sell off.
This has a similar feel to GSK as regards the market uncertainty on the company split.

Anyone looking to add into the market weakness? apart from the recent pull back, it does look to be holding and only moving small amounts. I would look to add if there's any market driven selling, as essentially when people sell anything, this will be a screaming buy as most of the risk has been taken off now. Not too many institutions holding so maybe only 10-15% maximum drawdown if there's a crash.

I would say some of the price action on tate is reflective of 'risk off/rebalancing in market,' 'lack of catalyst,' and 'ownership.'

The initial pullback/drawdown on the 200 day MA may have been to reflect risk/transformation, but at the same time a lot of market has traded sideways and we now enter period of risk off/rebalancing. I don't know about pre-deal, but it currently has about 18% institutional ownership; whilst this is significant, it is marginal compared to stocks that are trending which will often have at least 30-45% by major institutions and fund managers. I took this off morningstar:
Ameriprise Financail Inc. - 51,706,676 11.04%
BlackRock Inc - 23,621,189 5.04%
NORGES BANK - 14,096,530 3.01%

My guess is that this will start to gain momentum if positive news feed on growth strategy ramps up, we have final dividend in the summer so this will likely be slow grower over next 3-5months, but will do an elevator if plans go well. I'd keep a look out for major shareholders taking a position, that's what could really move the needle.

The valuation gap between a highly rated outfit like Treatt and Tate is huge, but Tate has to prove that it can pivot successfully in that direction and deliver the forecast growth rates. I think this is a raging long term buy but market cant seem to make its mind up. Unclear how raw materials inflation will affect the new Tate. Lots of questions which is why Mr Market seems uninterested.

apologies for the typos - I've got a hyperactive kitten
jumping over me.

If the PE partner decide to sell the TATE is also required to exit.

PE are not long term holders of assets, exception on rare occasions,
so it's either an IPO or sell on - sell on would guess.

Reading the statements it's clear the JV will be at frist
managed for growth - so I would guess on divi in year 1,
may be small payment in year 2, and a nice day payout
from year 3 - very much my guesstimates ONLY, please DYOR etc.

Some of the questions raised here this morning are at least
partly answered in the circular, all available to read on the TATE
IR site.

IN a nutshell, TATE retain operational control of the manufacturing
facilities.

They have pre agreed a 3 year business plan for the JV, from memory.

Yes TATE can agree to sell down their stake in the JV - subject to
certain conditions.

PE usually look for a 3-5 year exit, so would expect this will
be along those lines.

Specialist food ingredients is usually a highly rated industry.

Kerry group ..etc. Gave the example of Treatt yesterday.

FY '23 on pre tax is over £230 million on current consensus.

Now a lot can change before then etc, however the market
currently sees both margin and revenue top line expansion.

r1234<<
I disagree, whilst I am more fundamentals, however some traders/investors still use historical patterns to analyse positions, and not every trader/investor is meticulous in their research. Whilst we might of read reports, there are a lot of traders that simply go by price/volume analysis, sector/fund exposure, and trends, and therefore historical chart patterns will to a certain degree influence the market. Plus the basis of the change in business is to increase shareholder value, not decrease it!!!

if you take the food and beverages business and assume annual pre tax profit of £170 million, then tate is trading on a p/e of about 18.
Tate would have been held mainly by income institutions, who have been getting out, but growth funds will want more details of the agreement on the core business being sold. 49% holding means Tate isn't in control. Is new owner focused on cost cutting to improve profitability, or more new investment? Has Tate agreed to contribute 49% of any new investment to maintain its shareholding? Or give some of its shares instead? If its a mixture of the two, will dividends be taken out initially or not? Has the new owner agreed to buy Tate's remaining shareholding? Are there pre-conditions like rate of return?
Let's hope more information comes out about these things to know what valuation to put on the rump. And have clarity on how Tate will switch out of it completely, how long it will take, and plans to expand the growth food and beverages business.

You can't go on historical prices, they are about to sell half their business, a change in fundamentals. I have no idea what the market will value them at after. The half year results were good though, so who knows.

!!

Hopefully you are correct.

My position here is more fundamental, but yesterday was big volume, and if you scan out on 1-3-5 year chart, this must be near the bottom now. Most risk is priced in, I'd say its more general market sentiment holding back the SP. Based on history, I guess we could go to £6, it went to £5.66 in crash, but I'd say there's more certainty and upside now. Getting CLOSE!!!

Treatt PLC on current FY 22 consensus is estimated
to make approx £21.2 million is today valued at £670 million approx.

Tate - the £500 million capital return is today valued at less than £2.5 bn
and on current FY 22 consensus is forecast to made over £170 million -
over £230 for FY '23.

That valuation gap is astounding.

Looking at the broker forecasts, it is trading below ALL forecasts, back at 2018 levels...

Had a look at owners, standard life aberdeen have a 3% position, blackrock are hedged here. Need someone else to see value here, then we'll gain momentum. Otherwise could be waiting until next year and return details on sale of business.

well looks like we have the moderna boss to thank for this broad based sell off, I actually want to add, but this is my biggest position. I expect they'll play the market up and down for a couple of weeks, potentially market could sell off 10%, but this share should recover faster, it looks to me like its had a decent correction, it's lost a years gains, but still has tremendous upside with business transitioning and return from business sale. Fingers crossed GLA!

Brutal.