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I wish mate; my average is slightly higher than yours! and I have far too many of these...not quite sure how that even happened to be honest
MarkBellUK, are you sure you didn't mean to 320p as we could do with the higher target price !! My avg is 280p. But well done Lord Cruddas !!
Fyi
CMC Markets Plc : Peel Hunt raises target price to 220p from 200p
Agreed, I was expecting something - Leaky ship!
Thanks Mick
Great increase today, this is on top of the general upward momentum we've had over the last two weeks. I kept expecting to read something on here with regards to what this might be but there has been very little activity. I guess this was it
Operational leverage is working as investors and humble analysts hoped for. The balance between those two large numbers - net operating income and core operating costs - continues to look favourable for investors.
FY 2024 could see NOI of £315m and £240m of core operating costs, leaving £75m of pre-tax profits. The proviso is that this excludes variable remuneration and non-recurring items.
Variable remuneration has historically been quite large, e.g. £17m last year and £16m the year before that.
“Non-recurring items” is new: the company previously didn’t exclude this from its headline measure of operating expenses. So that will be something to watch out for. My guess is that the company will want to put redundancy costs in here, to show investors the one-off impact of its recently announced 17% reduction in headcount.
The FY March 2024 results should be very good, although could be impacted by those one-off costs.
The outlook for FY March 2025 should be excellent then, considering the new product launches, the positive momentum being enjoyed, and the lower cost base.
Of course we’ve just had an “ahead of expectations” trading update, which will require estimates to be revised, but I must say that the existing consensus earnings forecasts look very suspicious to me. CMC’s financial results are volatile and could surprise investors in either direction in FY 2025, but I’d say an upside surprise is more likely.
At a market cap of £579m I still view this as offering good value if the company continues to perform well, although I don’t have the same level of slam-dunk conviction as I had at the beginning of the calendar year. The share price has doubled since then:
https://app.stockopedia.com/content/small-cap-value-report-weds-27-mar-2024-smds-fevr-993290?order=createdAt&sort=desc&mode=threaded
SUBSCRIPTION ONLY -hence printout
Thank fu....
;)
210p
flying....
CMC Markets sees FY operating income at top end of guidance
Exceed expectations means sp rise .
Trading Update
Further to the trading update provided in January 2024, the Group now expects FY 2024 net operating income to exceed the top end of the previously guided range of between £290 and £310 million.
CMC Markets Plc
FY 2024 Pre-Close Trading Update
CMC Markets Plc ("CMC" or the "Group"), a leading global provider of online retail, institutional and B2B platform technology, today issues a trading update for the year to 31 March 2024 ("FY 2024").
Trading Update
Further to the trading update provided in January 2024, the Group now expects FY 2024 net operating income to exceed the top end of the previously guided range of between £290 and £310 million.
Following the strong trading performance seen in Q3, the positive momentum continued in the fourth quarter. We continue to see strength in the institutional and B2B business as the Group benefits from the long-term investments in this area. The Group also has a strong pipeline of B2B partnerships some of which are in the advanced stages.
From an operational perspective, development upgrades across platforms have continued as planned and in February the Group widened its trading offering with the rollout of OTC options. Following the launch of mutual funds in H1, SIPP accounts are set for imminent release on the Invest UK platform, as part of the ongoing enhancement of the long-term savings proposition.
Operating costs, excluding variable remuneration and non-recurring items, are expected to be in line with guidance at around £240 million for FY 2024.
With actions taken as part of the cost reduction and efficiency plans outlined in February 2024, the Group continues to identify opportunities for further cost savings across the global business as we focus on improving profit margins.
CMC is due to announce its FY 2024 results on 20 June 2024.
Upgrade on income.
Plus 500 results are released on Tuesday 20th. Should be interesting.
Chart
https://ibb.co/pz8Vnn6
The chart is looking much much better. If we can push through the sell zone I have between 175 to 195 it could well retrace back into the 240 zone
It is starting to look like most of the sellers have dried up (at last!)
This is going well through £2 although trimming on way up breadcrumb style in case of retrace.
Your predicted 160p has been achieved , Mary.
Jeffries are taking no chances :)
CMC Markets Plc : Jefferies raises target price to 127p from 75p
CMC Markets Plc : RBC raises target price to 190p from 150p
I like the 360p valuation that they had pegged
Analysing shares can be simple sometimes (maybe analysis is best when it’s simple?).
The investment thesis here has consisted of three simple ideas: revenues can improve, costs can stabilise, and then the operational leverage will see profits pick back up again.
First, revenues can improve cyclically when volatility picks up off its current low levels. Here is the VIX volatility sentiment, which as you can see has been quite depressed of late:
ajxTW-S2tOz8JZXv2O1LBcqPrExYd5BDRBZrplc9dZnXTT_1ODyUT0vYNPzw1ULUUQMrb2MqD5VXSripJscmBpGd9-O-JPjprEcUX98vGQLRZ_dA-jXl8iUVuWLfQpabGaqUoY3mKXj8pPCcDMAIoHA
The recent trading update hinted at sentiment recovering to some extent, with higher levels of interest in trading, even without much volatility in the market.
On the cost front, it was flagged by Lord Cruddas, and we were reminded in today’s update, that CMC’s investment cycle had “peaked” as it rolled out new products both at home and internationally.
However, I must admit that while I was optimistic that costs could be reduced, I did not expect such a radical change as a 200-person reduction in headcount. That £21m annual saving could transform results, if it’s true that this labour is surplus to requirements now that the company’s pace of product roll-out is slowing down.
Both forces (rising revenues and falling costs) appear to be moving in the right direction, so clearly I’m going to keep my positive stance on this share. Hopefully FY March 2025 will be the year when we see CMC returning back to healthy profitability as it was before.
https://app.stockopedia.com/content/small-cap-value-report-mon-5-feb-2024-placeholder-988097?order=createdAt&sort=desc&mode=threaded
(subscription only - hence printout)
Think this is it.
https://archive.ph/FqAlI
CMC Markets could split itself into two under plans being considered by founder and chief executive Peter Cruddas, the Tory peer.
Peter is very ambitious, old school.
Great traction today.