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Nice one sharehunter.
Appears as if RBGP, just will not go down anymore given current sentiment _ Ive been waiting weeks and weeks for it to see if SP will fall further but not to be, so I've decided to take a stake just in case they release a TU ( Nicola Foulston is heavily invested into the company so I'm sure she would seek to maintain the SP). Ok - so this is not a SYME or IQAI but if it can provide 15-20% upside with 6 weeks of waiting with minimal downside - me in !
Scoobydoo321 ,think along a similar line myself bought into syme a number of weeks past after watching it drop for months ,
even Today 10 million and a number of 3 million share buys
was also lucky timing buying into ncyt when fell back to over £2 before rising to £12 a share in months
watching rbgp then seen your post coming in
- it seems that quite a few departments in law firms are doing very well given the planning of Brexit etc. So I believe the Nov lockdown had little to no negative impact on Rosenblatt.
FORGOTTEN STOCK
Like £CRL , £RGBP -
- got sold off big time and did not recover from the sell-off in mad October (the doom and gloom month)
- the vaccine jump, had no positive effect on it (and why should it given that more money was to be made from more visible covid-battered value stocks (plus fried chips on the side!) )
All this meant that SP has remained at a battered price of 59p (mid price).
Overall, I reckon £RBGP is an excellent opp for a contrarian play with minimal downside with short term possible upside of 15-20% (or medium term wise- 50%+ if £RGBP can get back to pre-covid SP (with Convex (who was acquired I believe late 2019) giving additional helping hand (however, you may need to balance this off with the potential dilution if Convex hits their targets and fulfils the earn-out clause)).
Yes it is not like £RR / or £IQAI, ie rollercoaster ride. However, if you are like me and like your ciggie butt plays, this could be a good'un! Usual caveats, dyor.
Just dipped my toes into £RBGP today. It's completely out of favour in the current market. However, when stocks are shunned, for the contrarians out there, this could be an excellent play. Trade Update is expected in late Jan or early Feb 21. Current spread circa < 2%.
SUPPORT LEVEL - I have been scrutinising the trades over the past weeks. Whilst it has not gone up, it has remained at a support level of 58p (asking price). From the SP chart, you can see that this price has provided support in the past.
Currently, this is nearing the trough, the ciggie butt and it has been there for weeks.
During the Brexit negotiations last week, £RBGP's SP stayed relatively unmoved.
OCT 20 TU - From https://www.investegate.co.uk/rbg-holdings-plc/rns/trading---market-guidance-update/202010060700061583B/
£RBGP had a positive update which showed
a/ Lionfish getting back on track
b/ Convex Capital - the company specialising in selling companies - contributing to £RBGP
c/ Law firm side - remains robust.
From similar starting levels, the SP shot up to circa 10% after the TU.
SIMON THOMPSON (ST) - Given the positive TU, ST wrote an article on £RGBP, which lead to the SP to rise to its Oct 20, from 65p (after the initial release of the positive TU) to a high of 69p. Given that this has been one of his picks, it is likely that ST may recommend £RGBP come early next year again.
INDIVIDUAL COMPANIES PERFORMANCE
a/ Lionfish - is involved with litigation financing. In 2020, £RGBP have been strenghthening this team with the appointment of a new head. Given the current climate, I would believe litigation financing is attractive for potential plaintiff companies and able to perform well in H2 and beyond.
b/ Convex Capital - with the possible changes in capital gains tax for entrepreneurs, this has spurred on entrepreneurs seeking to flog their businesses ASAP. See https://www.ft.com/content/0129ca54-bb8e-4b06-8afd-0ff7ccb2233d
Whilst Convex may not be on a same playing field in terms of size and diversity as £K3C, flogging companies is what Convex specialises in. In H1, they were pretty messed up with the lockdown. In H2, given the Chancellor's possible raid on CGT, I believe, Convex would be pretty busy despite Nov lockdown. Also Oct 20 TU, mentions that Convex aleady have sales in their kitty.
c/ Rosenblatt operation (law firm) - We know from the Oct 20 TU, Rosenblatt was doing pretty good.
"Following the publication of the Group's interim results for six months to 30 June 2020 on 16 September 2020, the Group's law firm, Rosenblatt Limited ("RBL") has continued to trade well with case value and volumes remaining significantly ahead year-on-year."
The question is how has / will Rosenblatt perform from 17th Sept to 31st Dec?
I believe that Rosenblatt have gone from strength to strength because a Cross read from £GTLY and £KEYS (particularly £KEYS who issued a recent TU on 30th Nov 20 stating that their performance was "comfortably ahead")
Jammy - I try to use these forum for sensible debate. There doesnt always have to be an immediate money making angle. I think we all need to understand the key issues relating to any company before making (slightly more) informed investment decisions. I think PLC Law related firms are interesting. No one is "bad mouthing" (save that language for Twitter). We are just trying to ascertain cogent facts. GL.
Maybe ask Mr F how Manolete fund and acquire claims? My understanding is that it would be the same here other than that the estate would receive more of the collectables - making RBGP the more attractive option. Look to the future rather than the past.
Ian - She isn't here learn. Why would she publicly bad mouth yourself and the company while supposedly attempting the sell large quantities? That's not the action of a rational being, rather someone rightly concerned about their Manolete holding or someone short on a grubby spread bet thinking they can influence the market.
@Forensic505 I prefer to talk to a human being rather than a computer
From Mr F:
“Somewhat naive Jammy C. In 99% of cases a Liquidator would already have a law firm engaged investigating the claim. Over their dead body will they take money from a competing law firm! They aren’t stupid - a name change to “Lion Fish” isn’t likely to out fix them. And [as previously stated] Manolete gives a minimum 50% back to the creditor estate [as per their latest big case win and the vintage table you refer to]”.
@Ianblatt couldnt you just state them here ?
Have you not seen Mano's vintage's table and their money multiples? RBGP rightly want some of that and have the competence and resources to do it. IPs have a duty to do the best for for the estate so are obliged to get the best deal they can. If RBGP offer the same benefits but undercut Mano on price (while still making a healthy margin) they will get the business. That seems quite obvious to me and will no doubt of had an affect on Mano's SP in combination with the SharePhophets attack. Thankfully I only have a small holding there @ 300p as have concerns it may drop further with. Mano's PE being > twice that of RBGP's.
As for the payment that was disclosed via an RNS, It clearly stated the total amount was 1 million and that is was a one off.
rather than speculating about me, what I'm paid, what I'm worth to the business etc if u rang me up u might possibly find out some facts and u might be better informed
My husband holds Mano. He laughed when CEO said they would undercut Mano as Mano give "hardly anything away". Apparently Mano pay away at least 50% to Liquidators. I had a look at their last RNS and that looks right: £15m settlement and £10m went to the crediotrs it seems. I had a look at their website and sorry but the CEO is just lying quite desperately there from what I can see !
As you say the Convex acqn was unfortunate but the strategy RBGP say is to use Convex profit monies to invest in LionFish. COVID made Convex loss making and unless I am mistaken the pandemic is still very much ongoing. Very tough for any M&A of course. They are already well into their HSBC debt facility and have put £4m already into LionFish but litigation is VERY hazardous to predict to a conclusion (and sometimes you lose). So I cant see how that stacks up. You need deep pockets for litigation funding surely?
As for Ian Rosen: they bought the business once, why do they have to keep throwing millions at him to keep him onboard?
You stated "Ian brings in literally 90% of the business". While I doubt this is true, I can't disprove it - I only know that revenue per fee earner was £497,500. If however, Ian does bring in a significant outsized share of revenue, this does IMO make commercial sense.
Thankfully the business is transitioning (albeit poorly timed but who could have predicted Covid) so that it is less reliant upon RBL and we are told that Convex activity has markedly improved. Lionfish appears to offer significant opportunity, in particular with their ISLERO offering. I hold Manolete but think IPs will be duty bound to use this cheaper option allowing estates to receive a greater share of recoveries, while still enjoying the benefits they do due to the model. This is a huge addressable market.
I am still offloading (gently). Sale quote on any major volume is awful (if you can even get one).
Hear what you say about RNS, thanks. Still doesn’t make commercial sense however.
For those that missed the webinar:
https://www.youtube.com/watch?v=XewqX6hvPws&ab_channel=YellowstoneAdvisory
There was an rns detailing the arrangement so she could hardly be shocked. Your perception was very different to mine. Perhaps because you sold at a lesser SP!
Was pretty shocked to hear yesterday that they are still paying Ian Rosenblatt £millions not to compete for a couple more, even though they paid a fortune to buy the business!! Unbelievable. The CEO looked very shocked that someone knew that information....
Ian brings in literally 90% of the business. So when he goes this is worthless. By all accounts he is a greedy man, always in debt but has the management over a barrel here. This shouldn’t be allowed.
Webinar with CEO and FD today
Register
https://us02web.zoom.us/webinar/register/6316020720180/WN_x1vr6lu4RPyCAQPYgGxJ-w.
If you want to ask management any questions about this or hear how the co. is trading join a webinar next Thursday 15th at 4pm
register here: hxxps://us02web.zoom.us/webinar/register/5716020720349/WN_x1vr6lu4RPyCAQPYgGxJ-w
ST clearly didnt watch the management presentation yesterday.
To their great credit they were very transparent: the lit funding business was to be financed by Convex fees. Those simply havent come through (no surprise - terrible timing to buy a corp finance business but they couldnt have know of course). They paid £15m for Convex (ouch !) and £6m was due to be paid yesterday but target missed. Convex salaries slashed. Re-setting deferred earnout to keep them interested. So the lit funding business doesnt work now. If they run up more capital commitments there, they are in serious danger of running out of cash as they are already well into their limited Revolving Credit Facility.
ST is smart but he is still working for a living for good reason....
I took my medicine and sold yesterday. I just wish they had stuck to be lawyers - they are very good at that. GLA.
*A professional services group that owns law firm Rosenblatt, a nascent litigation funding arm and specialist finance boutique Convex Capital, prompted a 15 per cent share price reversal back to slightly below my summer buy call and 10 per cent under my entry point. Investors have massively overreacted.For starters, business is booming at Rosenblatt. Revenue from legal services soared 42 per cent to £11.7m, excluding £900,000 of work in progress, buoyed by dispute resolution (up 13 per cent to £7.1m) and corporate work (quadrupling to £3.3m). It’s highly lucrative work, too, as Rosenblatt’s legal eagles specialise in litigious/contentious work that enables the firm to bill clients by the hour and control the level of fees it charges. Indeed, revenue per fee earner was almost £500,000, up from £350,000 in 2019. Importantly, the trading backdrop remains favourable given that economic crises increase the need for the specialist legal advice the firm offers, and downturns lead to an increase in instructions on white collar crime & fraud.Secondly, Convex completed over £1bn of transactions in the four year-period prior to RBG’s acquisition 12 months ago, earning an average fee of £700,000 on each transaction to generate annual revenue north of £8m. Deferral of almost all Convex’s transactions in the first half reduced cash profit by £1.1m and explains why group cash profits declined from £3.8m to £2.6m. But management “believe this is a timing issue, with deal completions expected in the second half”, and highlight a “strong pipeline”.Thirdly, the absence of sales of participation rights in contingent cases (£2m of gains in the first half of 2019) is also a timing issue as the directors are “planning for a significant return of litigation sales in the second half”. The cash inflow aside, there is scope for material gains as RBG conservatively holds its £3.8m litigation investment portfolio of eight cases at cost even though the law firm has won 86 per cent of the 22 contingent cases that have concluded since 2011.
The other reason for the lack of participation rights sales is that RBG’s management spent time setting up and launching a branded litigation finance arm, LionFish, to fund cases run by third-party solicitors. It was worth the effort as it has got off to a flying start – £2.4m total commitment made across six cases – and has just launched a new product for insolvency claims, a market with strong prospects.There are no earnings forecasts in the market, but I feel that a likely strong second half profit recovery is being underrated. RBG’s heavily oversold shares (14-day RSI below 20) are trading on a modest price-to-book value of 1.25 times, on a 12-month trailing price/earnings ratio of 10, and offer a near 5 per cent dividend yield. The board has a policy to pay out at least 60 per cent of earnings and a decision on the amount of the full-year dividend (3p a share in 2019) will be made at the financial year-end. Buy*
Irrelevant to post that.
Poor results. Gutted. Why have the board messed up a perfectly nice little law firm by buying cash hungry corporate finance and litigation funding businesses ? Eating into their bank facility fast. Will run out of cash. Time to take my medicine. Game over here. GLA.
Islero was a Miura bull famed for killing the celebrated bullfighter Manolete on August 28, 1947.
No need to speculate whose market they are targeting.