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Hi Barrie, I would agree - I think PFG customers are disproportionately affected by high energy prices, so any cap would definitely help.
I have now sold these after holding for 12 months. A very disappointing 43% loss. You can't win them all !
Definitely going in the right direction albeit a company Name Change might be a consideration.. leaving the past behind.
Thank you, Theborn, very usefull!
Courious for the promised series of updates over the 6 next months and "measured growth"...
I assume the modest rise might be related?
Found this interview insightful. From MLM: Expecting Q3 update to show measured growth. PFG looking to make a series of updates over next 6 months to keep investors informed of progress on all fronts.
Believe it when I see it. But, still a very worthwhile watch for shareholders.
Earlier this week Chief Economist Simon French had the opportunity to interview Provident Financial CEO Malcolm Le May. Malcolm first joined the board as senior independent director in 2014, taking on the role of CEO in 2018. This followed a successful career in leadership roles at Barclays, UBS, ING Barings and Morley Fund Management.
Simon and Malcolm discuss PFG’s strategy, how Malcolm and his team have reshaped the business and how the story is insufficiently appreciated by the equity markets. The company is down almost 50% YTD and trading at just 5.5x PER estimates. The repositioning, which Malcolm touches on, towards lower risk customers suggests that the risk is being overstated materially. Legacy investigations from the FCA are now finished and the recovery element of the journey is now over. We believe the rating reflects the past and not the new lower risk business focussed on nearer-prime customers.
Without comment:
https://panmure.com/insights/meet-the-ceo-malcolm-le-may/
Theborn
I’m one of them!
I’m doing a lot of 0% balance transfers and cash withdrawal for fee as credit card company is begging me to do it but I’ve money in bank to cover it and am happy to spend money to help economy especially restaurants and hotels as won’t go out in winter due to health issues
If PFG can’t make money at this game they should go home
Agree their share options should be under water giving them incentive to do better!
I thought about firing a shot over bow of friend who is senior management level at PFG with obvious caveat and mutual understanding no price sensitive information would be disclosed just making observation their communication with shareholders was shocking which wasn’t their direct responsibility but I’d expect response would just be the SP fall in line with finance sector being the party line no doubt so I think I shall just have to wait but SP does seem to be supported at my stop loss of 170 with divi so I’m going to hold on until there’s an announcement to market that’ll determine if I was right as selling at this level would lose me £2 a share on at least 1,000 of my holding and that’s ridiculous given the company isn’t losing money
I just don’t have the courage to buy more but if my other share SHEL were to go up significantly I might risk it as am too heavily into a sector that’s unpopular for obvious reasons and makes me feel a bit uncomfortable but to be fair at home we’re paying the price for our energy use without quibble and our bills are high so I regard it as a natural hedge but do worry about those less fortunate which is why I don’t complain I’m £4K down on my holding of 4,000 shares but did fancy putting a 5 in front of the zeros if circumstances were different if only to give me a CGT tax break and a bigger upside.
It’s really though just picking red on a roulette wheel and I’ve a wife who’d beat me to death if I got it wrong!! ;-)
"The Bank of England said annual growth in credit card debt rise 13%, which was the most in 17 years."
So PFG should be showing at least 13% growth in their loan book just to tread water. Anything less is unacceptable.
This should be a super positive story for PFG and market sentiment:
https://www.bloomberg.com/news/articles/2022-08-30/boe-says-uk-credit-card-lending-and-mortgage-interest-rates-jump?srnd=premium-uk
"UK credit card borrowing rose at its strongest pace since 2005, and mortgage interest costs jumped to the highest in six years, indicating growing strain on household budgets."
To my earlier points on Bank of England statistical releases, coupled with this new story ----> lending sensible money to your target borrower base should be like selling ice to eskimos in the current climate. If the management had any form of confidence from the market this share price should be 50% up on the 220p pre-results rather than the 30% down.
Let's see in full year, but if they can't increase their lending and borrower base in the current market (which they hadn't in H1) then I'll personally be marching to Bradford to demand a change in managment. Utterly useless.
Says it all hxulcolrdoh. In any other walk of life if you are performing in the bottom 2.5 percentile you'd be holding a P45. Instead, these guys are getting paid a fortune and awarded share options to slap themselves on the back for this train wreck of value destruction.
I would suggest that when capital markets day is announced the active holders on this board look to attend and/or submit questions ahead of time.
In the meantime we should independently be contacting the PFG PR team to drive home the point the share performance is appalling and we demand more in terms of commincation on expectations.
Not huge volume but a lot of blue on the screen
I’m hoping the share will hover around the 165-170 level until and at least after the next announcement or go back to NAV level - if full year repeats first half profits these shares really are due a re rating - the only contact I’ve had with company suggests fall is in line with sector but that is questionable as most financial and banking stocks have recovered
Will go quiet now until we get some news I can comment on as speculation is pointless ????????????
Pooks
It seems to be finding its level albeit ridiculously low but could still slide if management mishandle the next communication as there’s really no margin of safety now in terms of missing profit estimates for full year
Ever thought fund managers are having to sell because it no longer fits there remit … trust me they all know
@Bigpunt: indeed, the collections performance and increasing number of the customers is as well the key
(for this, some targeted KPIs from the management would be very well appreciated)
Like MLM I quite like numbers. Since PFG announced their results on March 31st ...
- they have fallen something like 46%
- and have been the 341st worst performer of the FTSE 350
PFG now trading below 3 on PE ratio and below 75% of Net Asset value.
Has to be a value trade in the long term. I'm just so p1ssed off with management for lack of clarity.
Someone mentioned this before, but when is this sacred Capital Markets Day?! These guys never have any dates in the financial calendar on the website. Useless bunch and taking shareholders as third class citizens.
Pure speculation but my guess is they are holding out for PRA approval on deposit funding before announcing CMD so at least they have something new to talk about.
Petr I agree with much of your views but I feel the single factor that will determine the resilience of PFG through this period of turbulence is collections performance. I don't mind chunky central costs if the legal team and customer service functions are performing excellent
I agree with others have for now ignored my stop loss though will not necessarily do so if the price falls much further
I’m going to speak to company to needle them about their total dereliction of shareholder comms and parlous state of SP and won’t accept vague answers
@Bigpunt: Today the environment is so complex, that it is hard to predict and from my point of view no one is able to predict with high probability what happens.
=> although it is not a nice view looking on the current share price move, I am sitting long and not selling...
None of the bear markets lasts forever, no one knows what happens even tomorrow and which catalyst might come.
Regarding the price of this share - from my POV this might take more than 1 year to recover as there is stated that the increased central cost are to be expected as well in S2 2022 before they are supposed to be decreased in 2023 and that it shall lead to efficiencies. -> if this is not confirmed, this would be the last nail into this coffin...
Theborn the UK market is gloomy full stop. Investment in countries like the US is up because they don't have a ridiculous exposure to supply volatility such as energy. That means there are huge returns to be had for those investing in their ISA accounts in the right markets and companies. It's a fun time to be an investor - you might be looking back at your portfolio in 5 years lamenting the businesses that went under, and you might have trebled your money with 15% dividend yields!
Thanks Theborn I’ve resisted urge to cut and have been rewarded by a slight reduction in decrease in SP
You’re right about it being small fry and doubts over effective comms and I’m crediting tge management with too much
GLA
I'd be buying if I had the liquidity to do so, which is probably saving me from myself. Unfortunately I piled in to pfg in mid-£2s when it looked very undervalued at that time.
Re market knowing something we don't - I highly, highly doubt that is the case. Thanks to the recent efforts of management this stock is now massively small-fry (with market cap of c.£400m and not even large enough to grace the FTSE250) meaning discussions of PFG in the corridoors of the city will not be happening. Most analysts can't even be bothered to cover it anymore.
It's an undervalued stock with management who are inept and managing market expectations.
I'm hoping for an announcement in Sept of PRA approval on funding deposit access, which should encourage some form of postive rerate given benefit on cost of capital; followed by a positive trading update in early October. But then I'm not even sure management could effecitvely communicate both those positives if their lives depended on it.
Hang in there all.