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No doubt the SP wont reach 180p any time soon. Profits will be 8.7% lower. Does this warrant a 50% fall in the SP? I personally think not.
A recovery to even 20% below before the announcement would be over 130p. A nice 40% gain for those who chose to buy on the dip.
There is no impact on 2019 working capital versus expectations as nothing has changed. 2020 working capital will now be better than 2020 expectations, which I have assumed will positively impact net debt.
Bad grammar - sorry
"Now, profit warnings can be a good way of getting a share cheap and possible those that bought around 80p-90p have, but from my opinion the share will not be reaching previous heights for many years if at all now. Proof is going to be needed in the form of results for this to properly recover and we already know that forward forecasts for 2020 are going to be at least 18% down."
Everyone seems very positive here and the recent bod purchases are good but I fail to see this doing well for a long time now.
The loss of revenues from that one contract has been said to be 18% of revenues, but that is actually based on 2020 predicted revenues. Based on current revenues it is more like 21% and so the bod have glossed it over a little. What if some of those potential future contracts do not turn up?
Secondly the statement, "The effect on working capital in the financial year ending 30
June 2020 is anticipated to be positive." Is this then meaning that year ending 2019 working capital will not be positive? If so, what will be the effect of this?
Now, profit warnings can be a good way of getting a share cheap and possible those that around 80p-90p have but from my opinion the share will not be reaching previous heights for many years if at all now. Prove is going to be needed in the form of results for this to properly recover and we already know that forward forecasts for 2020 are going to be at least 18% down.
Made my last top up at 109p this morning. I think this will gradually get back to 130p.
SBB1, You are not alone.
i have just bought a small amount here at 113.8 . I am hoping this is a decent buy in price.and will get more if i see it making progress.
Any prediction on what you think this may recover to?
Paid. Cant believe I've got this whole board to myself. Well under the radar!!!!!
111p Anyone with much higher average should maybe think to average down....
Moving back to sensible level of 125 - 130
I'm back in the black now and looking forward to my 10%+ divi yield for years to come.
ride120 - 180 :D
107.00 Massive fall from 180.
200k shares purchased by various directors in the last few days. Always a good sign.
SP looks to be bouncing back hard. Early days yet but looks like one of those opportunities created by a horde of sellers that completely disregards fundamentals in the race for the door.
200k shares purchased by various directors in the last few days. Always a good sign.
SP looks to be bouncing back hard. Early days yet but looks like one of those opportunities created by a horde of sellers that completely disregards fundamentals in the race for the door.
200k shares purchased by various directors in the last few days. Always a good sign.
SP looks to be bouncing back hard. Early days yet but looks like one of those opportunities created by a horde of sellers that completely disregards fundamentals in the race for the door.
A few for ride back to 120
Great opportunity to top up but I’ll have to wait until pay day - I noticed Mr Woodford has increased to nearly 30%
Fall seems overdone. The market first started getting nervous about some additional working capital requirements meaning no dividend growth and an increase in net debt. Then the loss of a low margin contract could indicate further contracts being lost in the future.
I've held a small amount of these for some time and know the company reasonably well so bought a few more today at 88p with an average entry of 105p. Despite the increase in debt the company has low gearing (20%) and net debt to EBITDA of <1 and has been very conservatively managed over the last 5 years with consistent dividend growth.
The valuation currently seems pretty reasonable, with an NPAT £38m on equity of around £160m we have a ROE of ~25%. CF is weak right now given the increase in working capital but my hunch is that this will unwind. Consensus dividend yield seems unrealistic now but even after all the reduction should be giving a sustainable yield of +10%.
They have a pipeline of opportunities and some decent sized director buys by the chair, CEO and PDA of CFO today gives me some assurance that management are confident in the long term future of the company. The SP could fall further in the ST as no doubt some holders are keen to liquidate but as a longer term buy I think this is a good bet.
* News Release *
Issue Date: 12 March 2019
Redde plc
("Company")
Director/PDMR Shareholding
The Company announces that certain directors and their persons closely
associated ("PCAs") have recently purchased an aggregate of 139,374 ordinary
shares with an aggregate value of GBP122,262 in the Company in the following
amounts:
Name Position Ordinary Price Number of Date of
shares paid per Ordinary purchase
purchased share Shares held
following
the
purchase
Avril Chairwoman 56,497 88.50p 56,497 12-Mar-19
Palmer-Baunack
Martin Ward Chief Executive 56,497 88.50p 3,980,958 12-Mar-19
Officer
Patricia Oakley PCA with Stephen 26,380 84.39p 12-Mar-19
Oakley, Chief 2,020,000
Financial Officer
Shocking fall in the SP..
A few weeks ago this was 187p!!
I'm thinking we could see 60p now in the next couple of weeks.
Would I be tempted to top up?
Probably not.
Has anyone out there got ANY idea where this will stop.
On Friday when they plunged renowned find manager Neil Woodford increased his stake from 26% to 27.37%.
See RNS out at 11.24 today. So Woodford was already into Redde for 26% and he must believe the drop is way overdone.
I partly agree with many of the comments on here about Redde's hire car business model possibly being old hat and that if other insurance companies follow suit they will be in trouble.
ive had a few claims, a lot of insurance firms have deals with enterprise , so cutting out redd also its got to be done now though a porthole, witch means tighter rules, insurance firms pay you out quick now for your car and store it then claim of 3rd party , so hire car cost is going down the pan ,
If they lose anymore contracts, their fixed costs remain so dividends at risk. If next gen cars are sensor controlled or driverless I guess the paradigm shift makes Redde’s services extinct. Any thoughts on how Redde can grow its businesses and improve its dividend cover in the medium term people’s?
Interesting - thanks. Broker ratings are important but only one aspect of research. It looks like a few nervous sellers are moving out and not enough buyers are here .. yet. If I had a floor target - it might be around 80p.. just my opinion and I hope to be proved wrong. It seems that some wonder if another contract may be cancelled? It's a risk but the share price could enter oversold terriority soon gla
Cenkos have reiterated a buy. It's a bit like a football board giving their manager their "vote of confidence".