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Unfortunately the current shorts and their MM chums seem to be capable of negating any benefits gained from the buy back.
Agree mr anger shark - you will know that analysts split Rmg value between 60% Rmg value with a lower rating and GLS 40% (ish) with much more a UPS type rating. Deutsche post split between their own Royal Mail equivalent and DPD too.
Either way - crazy cheap - who sells down here apart from quant funds I have no idea !! The company’s buy back will fix the gap in the absence of normal funds / activists / predatory break up investors. The latter we don’t need. Let’s just get there with this buy back that ultimately helps everyone MUCH more. IF IF we could get that extra £200m bought back that would be 10% of the company and in two years time it might be 20% ! This is very very beneficial to us as shareholders !! 60p eps becomes 72p … and we match towards 700p, 800p, with £1bn operating profit one day !! … 1000p !!! Seriously (LTM or last twelve months it was £1.1bn!)
So I think 13.3m shares bought back so far ! I am going to guess at an average price of ??? 4.60 ? They have certainly had a few 1m days at decently sub 450p SO £61m spent so far of the £200m. Our eps gets better on every buy back obviously and the cost of the dividend saved is a great factor too. So if they have £140m ish left to spend (sorry if my guess of £4.60 is wrong - the numbers are there to be read I just am being lazy) - at 460p they have 30.4m shares (price depending) left to buy. Aware they said complete mid July BUT it would be very elegant for them and numbers if they could finish by the year end March 22 from a numbers perspective especially with the price seemingly low as it is (to my utter amazement) ! So 43 ish working days left would be 700k shares left to buy a day - TO REPEAT only if they had a timeline faster than they have previously guided.
Don’t forget - the company’s stated aim is to get back to a nil net cash balance sheet within two years with a starting point of +£600m ish net cash and then each years cash flows on top. Annual divies are £200m to give us our headline yield of 20p a share. The special was £200m and buy back £200m which I think will still leave with £100m with this years cashflow on top ? £400m call it this years cash flow ? So by the year end March 22 they will have £500m STILL net cash with 2/3rds of the final divi not paid for 9 months so it will seem like £600m. Hence my strong view they will get £200m bought back asap and then re load another £200m pretty quickly. Specials or buy backs who knows - I would have thought a mix of each ! Last bit - even when down to nil net cash we should still get the annual cash flows returned to us either through normal specials or buy backs. I think this company operating profit will become £1bn a year so maybe £700m cash flow. Value it on a cash flow yield NOT just divi yield gives 16% return !! This is why I LOVE this great company. Super super cheap. At some point this will jump 25% to begin its positive correction.
I know it doesn’t feel it yet BUT I love this buy back and I would imagine some form of buy back will carry on now with Rmg for quite a few years - fingers crossed.
World Quant reduce by .01 to go back under the reporting threshold.
https://www.shorttracker.co.uk/
There you go last minute drop
From memory when I was invested in AHT…and they were buying there own stock,there were limits….but I just carnt remember what lol
I don’t believe there are any formal limits but 25% / 30% would be the max in my view - which is about what they are doing of late ! A big buy signal. What baffles me is who in their right mind would sell it here !
Quick question if anyone knows ?
It has gone a bit quiet on news re union agreement - last year it was tabled and announced in Dec and on Feb 3 the new deal was announced. Interestingly On Feb 11th the game changing trading statement was released with the famous ‘well in excess of £500m profits’ statement.
Does anyone know the timings of when we are going to hear about this?
The fact that the company are hoovering up a near 1m shares a day I find very reassuring by the way. The two points are not connected directly but give me confidence
I am daily buying alongside the company as I still think this is easily one of the best value / growth stocks on the market. £800m operating profit ish for £4.5bn mkt cap! Simply wrong ! I love the fact they are reducing the issued share capital at such a rate. It would be amazing if they can get finished by end March and announce a new round - probably another £200m I believe. That would then have shrunk the overall issued shares by a near 10% which is brilliant.
Nice read across - GLS in particular
AngerS you are probably correct and it might be telling if we see a decrease in the shorts over next few days. As you say DK has plenty of ammo he can use to support any position he has. I am sure he gets the best deal available and hopefully the business also takes advantage by upping their daily buybacks although as Teslo pointed out that might be an opportunity to sell into, almost feels like a bit of a three way battle at the moment and we are just sitting ringside.
TonyS I cant see DK /Vesa Investments bidding for RMG or GLS I don't think he would be in the game of tying up lots of funds long term IMO he appears an investor looking for opportunities. There is always the possibility he could take some profit in the future. Difficult to know if his recent buys are to counter the shorts or him taking advantage of the low SP that the shorters have created with little outlay. Perhaps I am being a bit cynical.
Thanks that's the main reason I'm still holding on
Just a question who thinks DK might launch a bid ? I have been in since float however topped up when he bought his first 6 percent then again and again thankfully all in an ISA Put £40 k in was on 40m profit at one stage however now about 20 odd but had a divvy of 5k , Theres very little incentive to sell with interest rates are as they are, I hope he bids , Thoughts please ?
On every RNS the number of issued shares reduces so they must cancel them as soon as they are bought.
Better start to the week. I agree with Teslo's post that this is very similar to the previous drop. I guess the shorts could continue selling onto the company buybacks but you would like to think it has a baseline low.
AngerSharkz perhaps we have got an answer to the DK questions from last week although without doing the calculations his % holding will have gone up as the overall shares numbers have reduced through the buy back.
Dalcan IMO it was a combination of factors when DK was buying bigger chunks certainly shorters reducing but also due to better volumes/revenues/profit in recent trading statements. Be very interesting to see if we have any movement reported from the shorters in the next few days.
I wasn't around for the last DK v the Shorters referenced in other posts. did he put the squeeze on them? I see Vesa holding grew from the initial 5.3% investment to 19%. Shorts would have to be concerned if DK is prepared to keep buying?
There's an RNS about Vesa upping their stake which could be it
This looks like a repeat of what occurred at the end of September.
They dragged the price down to around 4.04 - 4.05 price level, but soon closed out when news came out about the Omicron variant.
Once they closed the price went back to £5 very rapidly, and that would be the current price level without the shorts, they're are attacking the price during the auctions anytime the price is close to breaking resistance levels. They will also be able to see the company buys on the order book, so it's textbook price manipulation.
I made almost 8 % this week trading RMG on two individual day trades, but my other account is down 6 % in valuation due to the drop since Monday.
Unless you are trading the downside or a short. World quant come back to the reporting threshold.
https://www.shorttracker.co.uk/
whether you like it or not this is being manipulated down letting day traders make huge daily gains
No AS, you just don’t like anyone replying or stating any opinion that is different from your own. Then you just resort to sarcasm, rudeness and being dismissive.
With an attitude like that your never going to learn anything new. Each to their own.
And if anyone would like to observe a classic example of what I am talking about, check the FRES board ( Fresnillo plc.) and look at what that has deteriorated into in the last couple of days
@Angel I have done that I currently hold stock in RMG with no intention of selling and also trade some others on a completely different broker account.
Have a nice weekend.
@Dan exactly this is what these boards do to people.
I saw it in 2019 and tried to help the a set group of posters out and tell them what I had observed only to end up getting drawn into petty bull**** and ultimately becoming the main target for them.
The same crowd predominately all sold sub £2.00 in mid 2020 after spending the previous 18-24 months going on about fundamentals and not much else.
Yeah, fair enough. You sounds calm…
I think Dan makes valid points and today is no different the price started well and tested the 441 resistance and then at the 10am auction the shorts came back in and have taken control once again.
The market is the market and fundamentals count over the long-term, but short-term the market is a traders paradise with the @vix at its current levels. (422 - 440 is 3 % in 24 hours.)
Anyone basing their buying of stocks on fundamentals alone would be a lot better off taking the Warren Buffett approach buy them and check in on the price once in a while but ultimately have a 3-5 or even a 10 year outlook.