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Rns - Placing at 250p to fund acquisition of JPS group which should produce additional PBT of £1.3m for 2023/24
Probably one of SCSWs best recent tips. Recommended buy in oct at 172p, recommended selling or taking part profit in Dec after +138% rise @410p, Now it’s dropped to 250p.
Unbelievable! 14% down in a day. This isn't a SCSW sell recommendation again is it?
I think the weakness is simply that the share is very illiquid and a 10,000 sell can knock 10% of the quote, or a buy add 10% to it. I was fortunate to buy at 170 (because the whole market cap was in cash at that point). But the point of the investment has to be fairly long term:
1) does the new business model make sense? I think yes, margins and ROC should be way better than those of a green power generator (and probably less regulated), one of the key reasons the company has given for the change.
2) can they compete successfully against the big operators? At the moment I think they have a lead in the service offered. Later they may struggle, but at that point there is a good chance of being bid for.
3) can they optimise their strategy. Yes! Unlike most early stage AIM companies they have plenty of capital to take advantage of opportunities as they arise and as the business develops.
Personally I am sitting tight. I would have another look at their progress and possibly buy more if the price returned to my 170p entry level.
Plummeting due to Labours 28billion green energy u turn presumably. Getting into bargain territory!
This stock should be changed to BAD ...£$%£$^$%^%$^$
Thanks goleftmassa, found it.
There is a whole section under “Our energy” dedicated to “Green gas” which outlines their exposure.
Bobbust (or anyone else), can you please explain why they refer to the price of gas when stating that they expected a loss for H2. I looked at their website and I see that the energy they provide is 100% renewable, i.e. no gas is involved. I thought maybe they meant electricity only, but they say energy not electricity. In addition, they also indicate they use 56% of bio generated energy, which I assume is biogas. So all these confuse me in terms of why they refer to the prices of natural gas and why milder weather decreases their anticipated loss. Thank you.
High winds and warm weather should be goo for GOODs profit
Profit taking due to the share price rise is understandable given the rise but this is still under valued.
Loss this quarter is less than projected.
Cash was £35m, unlike to change a great deal. MC still only £54m.
That's a lot of company for £19m
I sold my modest holding on Friday after doubling. I had trouble getting a quote (even tried selling in smaller chunks).
The illiquidity is why I won't be back in.
Maybe some but I expect not most. They will have seen a big profit and banked some of it even knowing they are pushing the price down. More encouraging is the resilience - someone is very keen to buy stock - possibly more than one person/entity, which is why they can't wait for the price to settle for too long. That smells like a bid coming although I don't see much movement in the top shareholdings recently. Perhaps a bit of retail interest in a very illiquid stock and equally illiquid market - working holders' way for once!!
I wonder if those sellers will now be tempted to buy back in at the same rate after today's RNS, I bought some more first thing (shown as a Sell on LSE)
Thanks Monty9 for the explanation of today's drop, it had been puzzling me.
I hold. I note Small Company Share Watch have recommended taking part profits in Good Energy after a 138% gain since their feature on the company two months earlier. That is probably the reason for the 12% retrace this morning.
For traders that seems a sensible course of action but I will continue to hold a full unit - the medium term opportunity looks superb and the company has more than enough cash to fully exploit it.
"Good Energy Group PLC (AIM: GOOD), the 100% renewable electricity supplier and energy services provider, issues a trading update for the 10 months to 31 October 2023.
Following a strong first half of the year, the Company's trading to the end of October has been ahead of expectations. If seasonal normal weather and stable commodity market conditions continue for the remainder of the year, Good Energy expects to deliver earnings ahead of the Board's expectations for the full year seeing a profit before tax of at least £4m.
Forecast loss in H2 2023 is now expected to be reduced, as weather conditions through the early winter have been generally mild and renewable generation has been stable, which has reduced gas consumption and softened short term market prices."
Andle
I feel the same way, what a pleasant change...
What an outstanding end to a lovely week. I don’t get to say that too often about my portfolio recently.
On we go!!??
Have a good end all.
A.
Well this rise has happened very quickly, it certainly seems to have some keen followers at long last after its time in the wilderness.
Monty
Interesting but complicated by the fact that on presenting the HY numbers in September the CEO did emphasise that the 2nd half would produce a loss due to hedging.
(I hold) A possible explanation of the rapid price increase from SCSW, outlining the Investec forecasts for GOOD:
"...Investec forecasts pretax profit to virtually double every year from £2.3m this year to £4.2m, £7.4m and £15.2m in the following three..." It advises this corresponds to eps of 9.5p 18.3p 33.2p and 69.2p.
I haven't read the Investec research but assuming its forecasts are reasonable this has multi-bagger potential from a position entirely supported by cash!!
I just stumbled, in youtube, upon a 1 month old "five minute pitch tv" good energy group investors update which is very interesting.
Half way through it zap map is mentioned as something they have high hopes for profit wise and which they have plans to go international with.
A very good 5 minutes for any interested investor, imho.
Andle/Oldboy
Thanks for your thoughts, to me the persistency of the purchases does seem to hint at a potential bit of M&A but the company is poorly covered, if cover is really an appropriate word, by the market players. I guess we just need to stay patient but the interesting part of them, imho, is their depth in the ev charging market.
If anything is likely to tempt a buyer, that is surely the part that would.
Barchid.
Have been thinking Ecotricity are gathering about to make another play!!
Maybe?
A.