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Peel Hunt are still calling it a Hold … not a Buy… what does card have to do to get brokers on board… what a joke
Just read this on Investors chronicle
But the lowly rating of seven times forward consensus earnings prices in the opportunity. Hold.
How on earth is p/e if 7 pricing the opportunity in? Who writes such nonsense is the reason I’m sticks are so undervalued
Yep. Or 140p, if one were to hopefully be a little on the conservative side.
Not that I am going to start counting chickens....surefire way to seeing the little blighters catch bird flu, and there goes the profit :)
Adjusted EPS of13.5% with close to 100% cash conversion implies a free cash flow yield of 12.2%. Can easily see this repricing to 8-10% or 135p-168.75p with 150p mid point.
It was the level of debt reduction, combined with the strong performance in this challenging climate, which caught my attention. The dividend return was only the icing on the cake, as far as I was concerned.
Anyway, took another couple of small tranches in the 107p range, in case it does not remain range-bound for much longer. Not adding more meaningful amounts until I do that research, but not going to get the chance during trading hours.
If it does not pull back, then so be it. That would be fine by me :) GLA.
Heading off here soon, lots of profit taking PI's are going to miss the boat because they can't wait 5 minutes...
Oh and @bhaveen, a little thing called inflation has been impacting operating costs of almost every company in the world... plus the interest on their debt & store leases is clearly substantially higher than in 2014-2019.
Nevertheless, the 14% PBT margin achieved in H2 is superb, combined with the debt reduction & dividend reinstatement it should be easily enough to justify a PE of 12x and a share price north of 150p.
Based on the below the margin has seen a bit of a tumble since 2018… I can’t recall what the driver was… but maybe this is one of the reasons we aren’t seeing that growth we wanted
Todays great results have not been reflected in the relatively modest 6% SP increase achieved to date but I fully expect this to continue to gradually increase in coming weeks as people get on the bandwagon.
CARD has loads of potential to significantly increase dividends over the next 6 to 12 months and it is worth comparing todays results with those back in 2018.
The figures below show how much scope there is for improvements to financial returns to shareholders especially when looking at debt, and div cover, plus the previous propensity to award shareholders with annual specials!
2018 2024
Revenue £422.1m £510.9m
EBITDA £86.1m £122.6m
PBT £72.6m £65.6m
EPS 17.1 14.4
DPS 9.3 4.5
Div cover 2.03 3.2
Special div 15 0
Net Debt £161.3m £34.4
Anybody got it please
So in summary card is
A market leader
Growing double digits revs
Introducing solid divs
Reducing debt
Expanding selectively globally with a purpose
Strong brand loyalty customer engagement
Supply chain presence (need more supply chain ownership in party celebrations. Todays teddies etc)
This is one you can call a lifetime hold no matter what games are played and the divi will put a real back stop behind wobbly knees I think
CARD Mkt Cap still only £370m ; MOON (even with sp down to 150p) at £520m. CARD has to at some point pass MOON if there is any concept of 'rational markets theorem' left in the financial industry. Further 30% rise from here and we might need to start thinking about fair value ... but only if this wasn't a growing company. Add in the targetted 10% per annum growth for the next few years and we really should be well north of 150p
I've had a chunk of these from the high days of 20p divi. I hung onto them through these difficult last few years but now the Divi has been restored this makes a continued long term hold for me. The company has certainly turned the corner and is going in the right direction. The price will settle down in the next few weeks once the day traders have stopped messing about with it !
I’m adding more also but I’m waiting for the 1.00 mark which part of me hopes doesn’t happen but who knows what with this.
Waiting for Peel Hunt to say something now…
Well, I liked the update and so have taken a small, maiden position here, this morning.
I assume the potential institutional overhang, as mentioned by others, is probably the reason why this is not up 20% today.
I need to do a lot more research here first of all, but plan to add further tranches if we remain in this range.
Am hoping for a retest of the 200 DMA in the days ahead, but think that might be wishful thinking.
A more realistic scenario IMO might be a revisit of the 101/102p ish perhaps. Subject to said overhang.
Unless we see a big market sell off, of course.
Will take a view if/when 140p arrives. GLA.
Anyone on the call able to pay summary? I can't seem to join.
Sorry between 2 and 3
Won’t sell mine as my yield at my average price is too healthy. I’m thinking go this could be like IAG which had great results but took a week or two after announcements to get going… at the same time we’ve seen cars go from 1.10 to 90p so many times now… but hopefully the divi will keep us stable.
I’m thinking perhaps the lack of significant move upwards is the divi was on the low end of the scale? An earlier post talks about hitting a dividend cover of 3.1 whereas card discussed a cover of between 3 and 3? Any thoughts anyone?
@Amateurs:
don't be spooked into selling cheaply, I've been in this stock for 9 years, with a fair chunk, this sp will rise above former levels now the dividend is implemented.
The ii's are scooping up the weak.
We are on our way to back to a pound at this rate… what a joke
Overhangs usually create the best opportunities, my view is that new II's coming in will clear out Teleios over the coming months and cause a re-rate. The market isn't renowned for rewarding impatient profit takers who sell what is obviously good news, to make money here you've got to ignore the noise...
Yup, they've sold 24m in last 12m (ft.com) but still hold c40m shares (11%). JP Morgan have been aggressive buyer during the same period buying c15m shares, but clearly the selling pressure has been tremendous
This will just be Teleios selling into the liquidity. Not surprising really. They have been doing it for a while now.
Noticed a huge sell of 500k worth of shares… disappointing when large holders lose faith but I guess everyone has their strategy. So far the movement has been a joke… what does this business need to do?????
I explained the context of the large seller Teleios last week - they bought 37m of Woodford / Invesco's holding pre Covid in the £1.80 range, so were hammered when Covid hit and shares went to 30p. They doubled up down there and then started reducing this time last year. I'd be very surprised if they don't run a good part of their holding back to £1.80, especially with a 4.5p dividend on their holding compensating them nicely...
Given the strong results, reinstallation of dividend, and positive trading outlook, am surprised that the sp is only up 7%....the team clearly have a lot more to get over the merits of the business model to investors. If these results had been posted by Moonpig, it hard not to speculate that the sp would have moved more consequentially...perhaps Darcey should have mentioned the magic letters "AI"
Yes I agree with the history but I think since covid all bets were wiped off and players like card have to go more than the extra mile to appeal… but on the bright side the divi will increase as time goes by and hopefully we will get some positive publicity to attract more shareholders… we still have sellers which i find odd bearing in mind the yield…but perhaps there’s more attractive shares out there I don’t know about ! Personally I’m happy to hold this out at least another year