Charles Jillings, CEO of Utilico, energized by strong economic momentum across Latin America. Watch the video here.
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Still can't see any changes by institutional investors.
What's the theory on the selling? volume is very low.
I think the share slide is down to:
1. Poor last results which wasn't expected by the market - a number of holders commented in their fund updates about this - and the nagging feeling that they overpaid for LQ and it isn't the panacea for structural decline in voicebroking (reason why Michael Spencer engineered the merger to rid himself of voice broking, meaning he could demerge his computer trading platforms into Nex, on a much higher multiple, which he was then able to sell brilliantly. Ever since Phizackerly was CEO it has been a downward trajectory and that is the structural challenge the rump business faces.
2. Omnicron perhaps being the excuse for delaying base rate rises from central banks - which inevitably dampen any prospect of a bounce back in trading vols at TCAP
3. It is certainly a more capital -light business since the redomicile to Jersey, allowed them to release cash that was ring fenced to cover the regulatory capital regime demanded by the FCA but it doesn't seem to have much of a difference to how the company is perceived by investors.
4. The Board is certainly stronger and higher quality but that puts more scrutiny on the 3 amigos running it - I think strategic doubts loom large
I’m going to hold for the full year trading update which should come around 2/2/22 although there is no confirmed date for this.
I’m a little perplexed as to why it keeps sliding. I’m seeing yield at 12p per share which now gives 9.37% nearly same as M&G which is around 9.47% at its current share price of 190p. If final divi here is 6p rather than 8p - still hefty 7.8%.
I would be tempted to buy more here now but did buy a chunk at 161p and added on 138p, so am down a fair bit on paper. I’m getting some more funds in a weeks time. Will look at the sp then as well as M&G, cmcx and few others. In general uk financials appear under severe pressure post Brexit.
Not sure on the shorting - or at least none above 0.5% being reported. BUT, to my mind, someone either (a) has a strong view that this is a busted flush (i.e. they do not believe the bulk of the adjustments to the reported results are real - notwithstanding the company's clear presentations on them and the analysts recommendations) or (b) they have a very clever programmed Algo (lots of small A trades all day followed by a chunk of larger late reported manual trades, or (c) they are barking.
Doesn't feel like (c).
Cheapsharesboy - I appreciate/welcome your views - and anyone else's constructive input (especially anyone with insight around trading pattern and share price action (which I do not have).
Continued, unrelenting selling.
All I can think is that this is being heavily shorted during a period of low volume.
Similar thing happening to Boohoo and lots of other shares.
Shorters galore.
Always appreciative of the genuine input from some of the so called 'experts' here...
I could be wrong. But my view is that the market is pricing this wrong currently.
I think the last decline is down to guiding LIQ earnings into lower end of forecast of £160-180 million for the 9 months plus one week that LIQ was owned by TCAP in the current earnings year. I see TCAP buying LIQ with the assumption of a 10% further decline in earnings, they expected $175-180m in that 9m plus one week period. Decline appears around 20%.
However, it seems as if all the positives are being ignored.
From the last RNS:
Data/analytics earnings increased 9% again due to new product launches. This will likely stay that way due to benefits of LIQ acquisition, the data offering will be excellent. Cost savings & synergies were ahead of forecasts.
We are also expecting launch of crypto-platform - I'm unsure how big of a deal this is?
It is also likely that volatility has now began to increase LIQ and TCAP earnings this month, depending in C19 hassle around the world, this will likely persist for a bit IMO.
COEX earnings were up 13% further improvement in TCAP business.
Final divi is forecast to be 6p giving yield of 7.6%. Mind you - depending of cash flow - this could be 8p - yield of 9.1%.
The low case I see as 4p still giving a yield of 6.1%.
I think 8p is likely but I'm biased as that is what I wish they will afford - although 6p maybe more sensible.
It is a long slow fight but I think they are turning this around. Feel free to disagree.
Finally, out of the 10 largest institutional share holders, none have reduced their share holding.
I agree that their RNS was poor, not offering any guide to PROFITABILITY.
I am NOT a big fan of the management.
I am also NOT a big fan of the company.
I am just trying to understand the logic of the current price from an investment perspective.
I cannot see how this price is justified from the publicly available info.
This is definitely becoming a deeply unloved stock, but I am perplexed at the current price.
Enterprise Value: £19.58m
Market Cap: £1.03b
Cash: £2.184b
Net Debt: -£1.033b
Gross Gearing: 58.6%
Net Gearing: -52.62%
Price Target (7 Brokers): 260.82p (~100% above current price)
Ratings: 1 Hold, 4 Buy, 2 Strong Buy
Dividend yield (2021E): 7.23%
Dividend History: Consistent payer
I agree that the chart is grim. But this is now being priced for imminent bankruptcy. But without debt, I cannot see how that is possible. The lowest price (that I can see) seems to be in 2009, when there were genuine concernes over a collapse of many financial institutions, along with TCAP, but we are not in that scenario. The worst case that I can see is a modest loss in let profit.
In terms of their credit rating, this is excellent at BBB-. They are currently able to borrow $250m in funds (due 2028) at 2.625%, reflecting a very low risk of default. The expiry is more than 6y out. This is amongst the lowest interest rates of any company in the FTSE250!
What am I missing here?
I fully appreciate that the old voice broking business is in stuctural decline - hence why they bought LiquidNet, but LiquidNet is now priced at zero.
Is @Fevertreeman or somebody else able to offer anything here?