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Breakout in sight
Red Hot Penny Share have tipped PCF.They put the kiss of death on every share they mention.eg=NEW down 94%=BIOM down 80%=STGR down 65%=WHE down 62%=FOGL down 78%=TOM down 42%=PAL down 65%=SGO down 98%=PHE down 97%=SEV down 48%=CDC down 94%=FDI down 94%=R4E down 83%=PPIX down 85%=WET down 90%=OXA down 74%=WAS down 60%=CGH down 84% and the list goes on.Don't say you weren't warned.Hopefully they might get one right this time.
Several small buys today and the SP is well up. No news release today, but I see from the 25 June 2013 research reports on the PCF website that Daniel Stewart have increased their target price from 12p to 18p, and Westhouse have a new 7 page note and have reiterated 14p. Perhaps these broker updates have stirred some interest.
Westhouse Securities have forecast £1.6m pretax for the year to March 2014 compared to 829K in 2013. Looking at the Westhouse note of 5 December 2012, this is based on 15% revenue growth and the same % gross margin as 2013. In the 2013 accounts, the chairman stated that "the last quarter of the year [Jan to Mar 2013] saw a 27% increase in new business volumes over the equivalent period in 2012. This has been followed by a strong start to the new financial year with sustained, better than budgeted new business volumes".
The results look pretty good to me. Also, Westhouse have reiterated their 14p share price based on improving EPS of 2.1p in 2014 (PER 3.3) and 3.1p in 2015 (PER 2.3). Also the chairman's statement is pretty upbeat and looks forward to restarting dividend payments in due course.
Brokers' forecasts are for EPS about 1p (giving PER of about 7) with strong growth in the year to March 2014. If the 2013 results and trading update are on target, it will be interesting to see the impact on the share price.
Interesting press release today from Sopra Banking Software, a supplier to PCF. The article focuses on the savings made by PCF as a result of installing the software. In the article PCF's managing director, Robert Murray, says that the last two months trading have been "our strongest yet for new business and we're going from strength to strength in a difficult market"
Written all over PCF's resuts
"We are opening a new channel of sales within the broker-introduced market. We are creating a direct sales presence in niche markets, which will benefit from the recent withdrawal from SME asset-based lending by ING Lease (UK), who accounted for about 40% of the broker market, a move we believe will create a significant opportunity for us." The portfolio decreased by 5.0% over the period to £79m from £83m last year, but this is expected to grow in the second half. The group was keen to stress that the strong performance of the portfolio and good cost control enabled it to deliver a better level of profitability and improve earnings per share to 0.4p (2011: 0.2p). Maybury added that he hopes to introduce a progressive dividend policy in the future, and believes that, depending on the company's leverage, it will be able to re-introduce a dividend payment in March 2015.
This difficulty has, however, been largely solved by the subscription, placing and open offer of unsecured convertible loan notes raising £8.9m. The majority of this amount was subscribed for by a single shareholder who has told board members that he is focused on building the business and remaining a long-term investor. Maybury said that the raising has "put the uncertainty behind us and we are now in a comfortable position". Looking forward, he said the focus of the company is now on growing the portfolio, making acquisitions, promoting organic growth, and increasing the return on assets to 2% by March 2014. The return on assets is currently at 0.8%, compared to 0.5% a year ago. Maybury revealed his confidence in the business is going forward, saying: "All the ingredients are there - the staff, the premises, the IT equipment - for us to operate a bigger business. We do not expect the cost of sales to see much change going forward.
Private and Commercial Finance Group (PCFG), an AIM-listed independent finance company, has expressed its confidence for the future having developed a strong platform from which to grow its portfolio. After a four year "period of survival", the firm saw pre-tax profits rocket 40% in the half year ended September 30th, as a decline in turnover was offset by a reduction to both the cost of sales and administrative expenses. Revenues dropped from from £26.89m to £20.82m year-on-year, while the cost of sales fell to £14.65m (2011: £19.23m) and admin expenses decreased to £3.75m (2011: £4.69m). Profit was also boosted by a fall in the interest paid, from £2.7m to £2.1m year-on-year. Speaking during an interview with Sharecast and Digital Look, Scott Maybury, PCFG's Chief Executive, explained that the past four years has seen a shortage of funding as banks exited the sector or became reluctant to loan in the long-term, creating a situation for the company where lending was long and borrowing was short.
New research http://www.pcfg.co.uk/research
Nice to see that this is where the covertibles have been pitched. Shows how undervalued PCF is.
Heading towards my target
Westhouse Securities note: Private & Commercial Finance group a Strong Buy http://www.pcfg.co.uk/pdfs/Westhouse_Securities_13_July_2012.pdf Next time read the thread !
Up to 14p
Two day riser so far.
Strong Buy http://www.pcfg.co.uk/pdfs/Westhouse_Securities_13_July_2012.pdf
Only way to get stock is to ask your broker to negotiate as very limited stock available online and each buy is moving the price.
Widening the spread as they have no stock
No stock available so evey buy moving it higher.
Is there a big buyer in the wings here?
Expect a significant re-rating in this stock. 14p would be a good first target IMHO
Where to next
Surprised that there is little activity here.