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Started: Jatw, 10 Jun 2024 09:55
Last post: jazim.77, 14 Jun 2024 14:45
There is no doubt that this stock is undervalued and unappreciated at less than half NAV. Why, is the question I have been asking myself for a while. Perhaps it was not generating enough cash before but now that the business is generating more cash, perhaps the only way the market can value JUST more fairly would be for higher dividend payments and that will not be tomorrow or next week/month.
In the meantime the only way SP can show a significant jump is for a bid to come through. Large US asset managers might be keen to enter the UK pension market. We would all be rubbing our hands with glee when that happened. In the meantime, there would be incremental but slow rise in SP. There seems to be a lot of support at the 100p level and rightly so.
I have topped up my holding today in anticipation of a few years of 15-20% returns on the back on a strong annuity market both bulk and individual.
Mgmt has outlined plans for 15% growth which is double your money in 5 years.
10.06.2024
JP Morgan raises target price to 170p from 160p
Peel Hunt raises target price to 150p from 125p
Direction of travel more important than the size….
Should also get a boost from the FT report today that Labour is not planning to reintroduce the LifeTime Allowance. That is probably better news for SIPP providers but it does no harm to have more certainty around large pension pots in Pension land.
Started: stargate, 29 Apr 2024 13:24
Last post: Jatw, 27 May 2024 20:31
Stargate - the upside has been limited as you suggested…..does your charting suggest anything has changed?
I am expecting decent HY results with an advance to 115-120p.
That's as maybe but I'm only here for the bid prospects.
Nd
Overhead supply from previous trading is likely to limit upward sp, movement, until price of 108. The preceding share price high, on the chart, was a flattish top, spanning 4 weeks, meaning most overhead supply from trading occurred within the price range of 103-108. There was also a bearish negative divergence between the chart price top pattern and the RSI(relative strength index), which forecast a sp, decline, represented, in the sp retracement , which followed. DYOR.
Started: jazim.77, 8 Apr 2024 13:10
Last post: Jatw, 28 Apr 2024 11:27
Press releases for £670m of DB transfer business have been made so far this year (source company press room).
Odd to add Just to an income portfolio given its low yield.
Even if the dividend is raised by 15% pa (inline with mgmt expectations for trading), then I would expect the yield to stay low as the SP will also rise.
FWIW I think this will be trading at 200p in 5 years and the divi yield will be 3-4%.
"Bearbull" investor of Investor's Chronicle has just added Just Group to its income portfolio. Referring to the recent full-year results, Bearbull believes these results show plenty of promise: a mix of favourable longevity assumption shifts, rising in-force profits, and a big step up in new business and sales.
Bearbull refers to company's market capitalisation, a 23% premium to shareholder equity, but adds this excludes the present value of £1.96bn in risk-adjusted future cash flows therefore the discount to tangible net asset value is 54 per cent whereas Barclays whose growth and returns look feeble by comparison, carry a discount of just 45 per cent.
This coupled with recent efforts by company's management to fill the valuation gap to other companies in this sector plus takeover speculation has led to Bearbull buying shares at 104p.
Started: jazim.77, 4 Apr 2024 10:53
Last post: Jatw, 5 Apr 2024 16:16
The market needs reassurance that the 2023 sales can be repeated and exceeded.
I expect them to add 20-30p to TNAV in 2024….and for the SP to be 120p at the 2024 results….if they can point to additional growth and value added, then 130p is possible.
Please watch the SP as it gets to the 110p mark (as Dormus suggested) . It might surprise you. Fundamentals are more important though.
Charts are a waste of time!
Yes 3 year high is just above 110 so a break through that level would be interesting
Does anyone have access to charts to see what they are suggesting about the SP in the short term? It does not seem to want to go above 107p. It is going ex-div next Thursday.
Started: Jatw, 27 Mar 2024 19:47
Last post: Jatw, 27 Mar 2024 19:47
Another +ve upgrade…
Momentum is now on our side…for the moment
Started: crawshaw, 26 Mar 2024 16:34
Last post: crawshaw, 26 Mar 2024 16:34
A bit slack reporting their holding.
Started: Jatw, 18 Mar 2024 12:35
Last post: Jatw, 18 Mar 2024 12:35
DB updated several insurers today, but only reflecting recent market movements and keeping them at hold….so not really indicating any strong + or - conviction.
It will move the broker average up….which always helps but not really informative.
Started: stargate, 14 Mar 2024 12:23
Last post: Jatw, 14 Mar 2024 14:11
Stargate….that sounds like a positive thing….does your crystal ball have a forecast?
Today, sp, broke above fractal high of 101.4, of 8/3/24. Yesterday, was an outside day, indication volatility expansion. An outside day, is described as a price bar , where the high, is higher than the previous day high, and the low, is below the previous day low. Volume was more than 50%, higher than the previous day, providing additional power to the significance of the outside day. Not only that but the outside day volume was greater than the down bar which followed the fractal high.
Started: crawshaw, 14 Mar 2024 11:26
Last post: crawshaw, 14 Mar 2024 11:26
Where did you go?
petroinvestor
Posts: 1,441
Price: 77.90
No Opinion
Time to take profits before someone takes it 19 Oct 2023 15:29
Just Group is exposed to interest rates, as its investment portfolio contains a significant amount of fixed-income securities. If interest rates rise, the value of Just Group's investment portfolio could decline.
Started: Daytrader17, 8 Mar 2024 08:20
Last post: Jatw, 14 Mar 2024 09:27
At the risk of being contradicted by the market, the initial profit taking that caused a retreat below 100p seems to have been overcome and there seems to be more support to sustain the SP above 100.
As mentioned in earlier posts, I expect to see 20p added over the year, and I suspect this will be in steps with the HY and FY numbers. Of course a market movement could override this expectation but the annuity market seems to be set fair at the moment.
Expecting some broker upgrades this week before the analysts have to focus on Pru/ PHNX/MNG
The new highest high for more than 2.5 years, is past the potential limitation(2 years) of overhead supply from previous trading, selling. With little resistance, the sp, can be expected to trend , with the usual price retracements.
The volatility based Bollinger bands, are separating, indicating high volatility. DYOR.
Jatw. Spot on ...A bargain that will rise from here,as investors become aware of the value and cash generation ....
This was 100p in 2019 and 110p in 2021……just think of the progress that has been achieved since then……
They are adding 20-30p per annum for the next few years to the shareholder value and paying out 3p growing to 6p in 6 years….the additional value should mostly flow to the SP.
Add 25p for 4 years and this is £2/share…..it is now makes sense from an investors perspective so I expect we will see a rapid re-rating during 2024 and then steady growth for the next few years….
Started: mystic1076, 8 Mar 2024 07:04
Last post: hellyeah, 8 Mar 2024 08:05
One of the best UK businesses out there. Dare I say. Today is the day we cross £1b mcap and hopefully climb towards £1.5b.
DAB - agree….we can expect them to add 30p and more to the TNAV for the next 5-10 years just on UK business.
There is approx 100p of debt to repay….but all the additional value flows to Shareholders and most of it should be added to the SP.
Whatever price the Directors were holding out for last year is justified and they will add some more for any new discussions. I dont intend to sell any (except in GIA to move to ISA/SIPP wrapper).
On the dividend point. It is still a relatively young business so the cash it is throwing off isn't the same as the older asset rich insurance businesses. It also doesn’t have a huge customer investment book hat it charges fees on. Again, this impacts cash generation.
Don't pay out cash when any cash can be used as capital against growth , when the RRR is 13.5%+ keep it and grow.
There are so many good number in here. The 34p in underlying value growth per share is the one for me. From 190p to 224p. Thiat is real value set to be paid out in the longer term and bosts the liklihood that someone might take them out when the price difference is so great. I expect us to shoot past £1 and would expect £1.20 within a few weeks .
The summary results look very encouraging. 2p is still a small dividend though. If new business strain is so low at 0.9% and cash generation is good, cash will just pile up unless it is somehow spent. Such an interesting proposition.
Really excellent, far better than expected.
Hopefully the market will take note and look forward to value added for the next 5-10 years
Started: busicat, 8 Mar 2024 07:27
Last post: busicat, 8 Mar 2024 07:27
Record year in 2023 and forecast to be beaten in 2024.
"we are forecasting that 2024 underlying operating profit will be at least double the 2021 level of £211m."
They say this means doubling profit in 3 years instead of the intended 5.
How often do you see that?
Started: Jatw, 28 Feb 2024 16:07
Last post: shandypants2, 7 Mar 2024 14:26
Yes agree, 90 plus.
In Jan RNS we were told the new business margin in H2 exceeded the 8.5% they achieved in H1. New business profits in H1 were excellent so if this volume has continued into H2 with a higher margin then the reported profit should be impressive.
H1 excerpt is below..
Retirement Income sales2 have more than doubled to £1.9bn (H1 22: £0.9bn), which has driven a 112% increase in new business profits to £161m (H1 22: £76m), with a consistently strong new business margin of 8.5% (H1 22: 8.6%).
I am expecting good results and an open above 90. Although I am doubtful it will be able to cling on.
A nice little run up ahead of the results, assisted by the positive noises from LGEN and AV in relation to annuities….
I really hope the potential here starts to show soon.
Wow, almost £200k trade at 8.41 today. Pretty sure that's a buy. Bodes well for tomorrow
LGEN NBP margin of 9%, CSM released at 6.6%….what will Just make?
Started: hellyeah, 18 Jan 2024 07:52
Last post: shandypants2, 25 Jan 2024 10:05
I particularly liked this comment in the YE trading update. SP reaction is unfortunately somewhat muted despite fantastic numbers and expected operating profit growth.
"Our successes in 2023 and positioning in buoyant markets give us increased confidence in our prospects for 2024. These strong foundations enable us to continue delivering 15% growth in underlying operating profit per annum, on average over the medium term."
JP Morgan agrees. Raised price target from 125p to 135p.
"Just Group's management actions in recent years have led to a Solvency II ratio, debt leverage and quality of capital that now compares favourably with peers.
"We see very strong new business growth prospects, which should support double digit dividends per share growth, coupled with an attractive valuation."
FT reporting that the BPA market is set to deliver £60bn of premium in the current year….
There is more than enough business to go round with participants reporting staffing as a limiting factor in how much business they can process….
1 Expect Just to continue to dominate at the smaller end (but this is largely automated for Just)
2 Expect Just to pick up a share of larger deals.
Look for the cumulative effect of writing volume at decent margin to show through….both in the value of future business and in free cash flow (6% of the VoNB each and every year for about 25-30 years)
Market perked up a bit on Friday and following through this morning as the TU was digested.
Hoping for a strong movement when the results come out.
Agreed re YE operating profit. Was £173m for H1 and H2 was at a higher margin so £350m seems the minimum.
For a business valued at less than £900m this is ridiculous. Even at a low 5 times op.profit that's a valuation double the current SP.
I have bought this morning …there are expectations of 1 or 2 new players entering the bulk annuity market this year…..surely they will look at investing in Just as an entry route rather than set up a new entity and seek regulatory approval……
Started: Jatw, 2 Jan 2024 09:32
Last post: Jatw, 4 Jan 2024 13:27
Lloyds is selling a £6bn BPA business - it is suggested that Royal London is a prime bidder….It is not clear whether Lloyds is just selling its back book or whether bid teams and administration is also up for sale. It will be interesting to see what the disposal profit is relative to CSM/embedded value of the book rather than the pure liability value…..
The £6bn liability is about 3 years new business for Just, so I would not expect Just to be a bidder…but you never know….
It would be interesting if they could form a JV with one of the potential PE entrants.
Yep 26/1 last year so expecting similar timings this year. Was hoping a few 2024 share tips would include JUST as it seems massively undervalued. If we repeat H1 performance operating profit will be c £350m and the company is valued at less than £900m. Surely a ridiculously low valuation.
I expect Just has sustained its sales volumes (in terms of individuals covered) in H2……annuity rates have been higher and although slightly off their highs still provide better customer value than for many years due to higher interest rates……those same interest rates will have reduced the annuity liabilities being taken on from DB schemes….but the added value to Just should be similar.
My hope is that we see mid 90s following the trading update.
Started: Jatw, 15 Dec 2023 08:42
Last post: Jatw, 15 Dec 2023 12:23
Apollo said to value PIC around£5bn….HY capital/ownfunds…around £6bn
Similar to 170p for Just?
3 large US PE groups are said by the FT to be weighing bids for Pensions Insurance Company - which is already owned by PE/Sovereign Wealth Funds.
While it will be easier for an off market deal to be struck, it will provide a benchmark valuation…and the disappointed bidders (unless they go into a consotium) may take a look at Just….lets see what transpires….
Started: Jatw, 27 Nov 2023 16:13
Last post: Jatw, 27 Nov 2023 16:13
Now 136 (was 125)……actually still only early 80s. So 70% upside per Barclays.
Maybe the analyst is named
Asif Pigscanfly
Started: Jatw, 22 Nov 2023 15:53
Last post: Jatw, 22 Nov 2023 15:53
Just has a large share of the sub £100m market…..hopefully the consolidation idea for PPF is in the sub £10m market…..otherwise Just will be JustTakeaway.
You win dab808, I only have six of them.
It is like a list of the stocks in my portfolio. I only need Drax and I have a full set....
What next to buy I wonder :)
Very undervalued according to Share Magazine
https://www.sharesmagazine.co.uk/article/three-quick-and-easy-ways-to-screen-the-market-for-value-stocks
And PHNX has an extra £500m burning a hole in its pocket….that alone could buy a good chunk of Just….with the rest in shares…..just saying.
Positive on Just, last TP was 115.
Says just moving to a point of excess capital with potential for positive dividend surprises.
The BOD should have some interesting options to consider
- invest in more new business
- take on more risk by reducing reinsurance
- pay higher dividends or dividend+buy back/debt reduction…...
Started: Jatw, 9 Nov 2023 20:02
Last post: Jatw, 9 Nov 2023 20:10
Correction, the PRT sales were 16 deals value of $250m….obv a senior moment
The announced results include origination of $2bn of annuities in Q3 and £1.6bn of pension risk transfer business.
Clearly they have an appetite for the type of business Just writes and would be able to capture more of the value than Just can.
Maybe there is more to the rumour a week or so ago….some decent gains so far this week when other insurers have not really advanced.
Started: CaneToad, 23 Oct 2023 12:37
Last post: Jatw, 7 Nov 2023 13:22
CaneToad - I think the story is one of jam tomorrow.
There is certainly accumulated value in the policies already in force that will flow over the next 40 years…..but management is yet to realise it for shareholders.
As a monoline insurer it gets all the riskiness of a single product but has somehow managed to grow significantly without the share price rising.
It is not alone with competitors LGEN / AV / PHNX / MNG all flat / declining.
On the face of it, you can buy about 200p of value for 70p….not many markets allow that - especially one that promises 15% growth for the next decade as the DB schemes are transferred to private hands.
Why is this? Concern about financials generally, a past history of regulatory intervention and a balance sheet that has been weak but is improving steadily.
LTH dream of a take private deal….management say they have talks but presumably the price they wanted was unrealistic…..I for one would take 120p… in the absence of a deal the SP bumps along unloved…..maybe the market view will change, but then again negative macro events keep happening to threaten the financial system….
I've spent some time ploughing through the financials here and it seems very 'cheap' for such a company - but what is the attraction?
Management boast how well the company is doing, but unless you're an expert at IFRS accounting for insurance companies, it's impossible to untangle the story:
- The divi is unattractive
- The share price has done nothing but decline in a decade
- I can't find any broker research; ResearchTree has nothing at all
- It looks like a zombie/neglected company
On the other hand, if there is any truth to the recent outlook/performance spouted by management, it seems there is an opportunity here for the brave, if there's any virtue at all in the ultra-low p/e.
Started: petroinvestor, 19 Oct 2023 15:29
Last post: Jatw, 21 Oct 2023 19:50
Petro
Note that although the value of bonds will undoubtedly be lower….these assets are held in a “matching portfolio” to back the annuity liabilities….the value of liabilities also falls because the future payments are discounted at a higher rate….the result is that the capital position does not change by as much as you might think.
The loss in value of the assets goes through the contract service margin (future profits) as do changes in the present value of future liabilities so there should not be huge headline IFRS losses.
The key is the capital position and cash released from operations….both have been improving in the last few years and the company looks to be on firmer foundations…..of course a market meltdown would be challenging to all financials.
Just Group is exposed to interest rates, as its investment portfolio contains a significant amount of fixed-income securities. If interest rates rise, the value of Just Group's investment portfolio could decline.
Started: Lordeh, 17 Oct 2023 10:44
Last post: crawshaw, 19 Oct 2023 11:29
Another failed investor. The trade is there for everyone, and anyone, to see..
19-Oct-23 10:19:43 80.41 296,254 Buy* 79.20 79.40 238.22k O
£238k buy this morning!
Last broker rating on the had this at double the price it is now (shows how cheap these shares are)
13th October 2023 .....RBC cuts Just Group price target to 150 (170) pence - 'outperform'
Will it happen though? Either way, I'm happy to sit on these in my ISA too, collecting the (small) dividends along the way
Had this share for a while sitting in an ISA
Lets face it the bulk annuity isn't "sexy" but we could be in for interesting times
Still waiting for 50p Ria?
Your warnings are indeed dire-ria20..
This is a dump and yes it is a dog
Fantastic analysis as always Ria
This isn't a pump and dump AIM share like all of your 'investments'
Stop embarrassing yourself.
Be warned no bid and this will crash and most will get burn't .....don't listen to the likes of cranshaw .....NEWBIES BEWARE DON'T GET CAUGHT HOLDING THE BABY!!
Started: crawshaw, 4 Oct 2023 10:50
Last post: crawshaw, 4 Oct 2023 10:50
Hoping the next one's a little bigger, no reason why not.