Stephan Bernstein, CEO of GreenRoc, details the PFS results for the new graphite processing plant. Watch the video here.
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Do I take the 15% in 2 weeks or trust my dcf and hold?
What better opportunities are there? Anything else that has over a 15% free cash flow yield and also strong growth? The market overall is just expensive atm
Ps Cane Toad, I do hope you haven’t bought into another lawyer! There are so many better opportunities.
Law firms don’t do that. Far too expensive, and good lawyers are extremely difficult to find and recruitment costs are ridiculous. Clearly the point of this amalgamator is to rationalise, but generally redundancies in the legal profession are not a good sign.
Some firms make redundancies, no matter what the business climate; e.g. Goldman Sachs gets rid of 10% or so of their staff every year. Some law firms do the same. I wouldn't read too much into it.
Hmm, i was thinking that lawyers would do well in a recession, dealing with everyones bankruptcies
No idea, but the Lawyer is reporting today that Knights is making redundancies.
Why the 8% rise in price on Friday?
I've now banked a 61% gain and I'm out, didnt get the 140 i wanted but close, i don't like the system Octopus appears to be using here, was my second largest holding but I want a price to sell all day every day in descent volumes, often struggled to get a price to sell here. With Octopus in the driving seat, they can take it wherever they want.
I sold my Knights shares before and after the results, after a fantastic 30% rise over Christmas.
https://x.com/DartronTrading/status/1745407668406173818?s=20
I just felt that there wasn't anything left in the tank from a rally perspective. I bought another small cap, which is in the position that Knights was around a year ago. Well under half of its fair value, still recovering from a few recent issues. I think that is what attracted me to Knights, being able to buy as low as the 70's. with a 50% upside.
I note there was a lot more discussion on this board back at that time, have most sold out as well? I was prompted to post here today as I found this rating from Shore capital, which has a target price of 115p - and yes it was published after the latest results. TBH, I would like to buy these back, but Im not interested in paying above 115 for them after ExD. The Investors Chronical also rates these as a hold and has them on a PE of 11, which disagrees somewhat with Shore's PE of 5 even taking in to account the rise in SP. The shore article is a little contradictory expecting the shares to re rate, but the price is already above their fair value target. I can see the 115 target on the research portal of IC, so its not a typo. The median target here is 160. I have shares that have dropped on weak earnings with higher % targets than this after they have been down graded - AFM today for example, "Analyst Calum Battersby retained his ‘buy’ recommendation and target price of 420p on the consultancy group" that is a 25% upside target after a downgrade. All makes me thinks Knights is around fair value, and not much of an income play. (AFM is not my new small cap, im stuck in there over a year).
Shore Capital makes a strong case for resilient Knights Group Legal services company Knights Group (KGH) is trading on an ‘undemanding’ valuation and has scope to rerate, says Shore Capital. Analyst Jamie Murray retained his ‘buy’ recommendation and ‘fair value’ target price of 115p on the stock, which was trading at 121p on Friday. It reported ‘resilient’ first half 2024 results, which ‘highlighted that management is executing its renewed strategy to focus on organic growth’, Murray said. ‘The outlook is positive with non-cyclical legal activity showing resilience and recruitment initiatives increasing fee earner headcount,’ he explained. Although Knights is a ‘well-regarded law firm with as strong presence outside of London which enables it to win market share’, Murray said the shares trade on an ‘undemanding price/earnings target of 5x’. ‘We expect this to increase following these resilient results,’ he said. ‘If management continue to execute its new strategy focused on organic growth, we think it can rerate to a multiple more in-line with the sector.’
Another good day! Slowly and steadily creeping back to where it was a couple of years ago…phew!
Knights Group CEO, David Beech and CFO, Kate Lewis present half year results for the six months ended 31 October 2023, followed by Q&A.
Watch the video here: https://www.piworld.co.uk/company-videos/knights-group-kgh-half-year-results-presentation-january-24/
Or listen to the podcast here: https://piworld.podbean.com/e/knights-group-kgh-half-year-results-presentation-january-24/
The update looks okay-ish.....140p is possible...... the cash situation however looks a bit flat.
Well theirs bringing in a guy giving a statement of intent, we gonna grow this
Eps 23.2p net £20.52 i have as a consensus of 5. 30% off this is 16p hence @ 92 was 5.75. Not sure anyone cares about value presently, costain dropped to below net cash last week...thanks very much i said in the back of a tuk-tuk.
I'm seeing consensus EPS of 16p in 2025, so 30% reduction would be 13p, giving a P/E of 7. Keystone trades off a P/E of around 20. Ok so Keystone has a net cash position and Knights has a significant cash outflow related to acquisitions but if you compare growth, margins etc they are roughly comparable so why such a premium? If you compare to the overall market there is a whole host of decent companies around now with P/E in the 5-10 range.
We've identified 30% of real estate exposure and pessimistically removed 35% from earnings based on consensus of 5 analysts in 2024 2025 and this places it on a forward PE of 5.6 2025. This is still cheap v piers 8-19-9, 65% below professional & commercial services average and this is assuming that not one single property transaction takes place, and they do not get any benefit from corporate law acquisitions and international business/insolvency aka "very very bad". I think that's too prudent but still shows considerable value. I think it is worth nearer an 8-9 on a eps of 21p, the consensus of 5 analysts is 162p. Mid 2024 things will be different the charts for inflation and interest rates align there. For me, the risk is minimal, and the reward is high.
It’s slowing - and a large chunk of the market is property driven, so it would be illogical to think it won’t be slowing. Trouble is, the massive overheads will continue to steam roller in each month regardless. Each to their own Ragnor, but I just can’t see the risk/reward here bearing in mind where we are in the economic cycle.
There isn't much to suggest the legal market is slowing. They recently confirmed momentum for the first 5 months. Keystone came out in September and also confirmed positive outlook for this year, with a decent upgrade. The real estate exposure around 30% is a niggle but they don't seem to have flagged anything too adverse. Any other worries seem to be more than adequately covered by a very low multiple
Everyone said Ince was too cheap. It wasn’t.
HD that was the focus of one of my earlier posts, you can allow a huge unexpected and unforeseen drop in earnings here and it would still be very cheap, the company has not indicated this will happen in its latest update and in fact, mentioned organic growth. Finding value and an adequate safety net is important, for some, it's just about following what others do without deep research. After seeing the recovery I'm quite sure that traders (not investors) got spooked last week. Now I know NT is involved and his people are, it explains it all now. Strip out an unexpected 35% of earnings in any company you follow and still see if it is still cheap. Those drops Rag surely have to be the RB effect.
The legal market is slowing, and cost of business remains really high. There’ll be a race to the bottom on fees this year as clients shop around. It has only just started, but I’d be very surprised if it doesn’t continue and escalate. This is not somewhere I would be looking to park my money.
For over a year now this stock has seen recurring savage reversals followed by swift recoveries. However It does seem to be in some kind of upward channel, as much as anything in this market, maybe there will be a break out. It seems awfully cheap at 2.5x EBITDA but so does everything
Having gone back over the results and outlook I see nothing to explain this drop except what TP has highlighted below and that is a large group of people following one man who suddenly found the bottom dropped out of the support when someone clumsily ditched 2x £70k of shares and at the same time the 450k order was removed one afternoon, this damaged the chart, that led to more dumping by systems as SL were hit, was that organized i wonder. Whoever had that order at 450k now has prices lower which explains why i kept getting outbid on the drops........Industry Forward PER DWF 8, Keystone 19, Gateley 9...........Knights is just 3, that's too cheap. Stopped just below the actual SL price RB gave. also so very interesting.
Bought, once on the book at 78p for a new pf I have created today. And once on the ask at 79p in my SIPP.
Outlook for both >2 years. I see no reason why KGH cannot get back over £1, and head up to £2 in that time.
The new pf, is more geared to income, over 4 holdings, 2 REITS + L&G and KGH for income and growth. I was planning this earlier in the week, and it would have been Aviva instead of L&G, but TO news has spiked the price today.
The new pf sits alongside my extreme high risk crazy 'bottom picker', which is where I first found KGH, and where I took the 15 minute trade. Bottom picker currently down >40% (it turned out NOT to be the bottom on a few!), but I'm very excited about its prospects again over 2 years.
I thought we might see a spike down around 2pm (normally do with shorts), but I could wait as have work this afternoon.
AFM is a bargain if anybody cares..