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£11.50 per share minimum. Company is worth at least this sum per share. Well done to all the holders. I’m delighted at this news!
Yes - these interests (Bain & Apollo) are a welcome call to PIs because we have suffered - association with plastic!
What troubles me is the mass media frenzy ( against plastic .) which will ultimately have the power to destroy every enterprise. The result will be the destruction of the way of life we have.
Surely the shares are worth £10+. We shall soon know.
Just to add that most active fund managers do not consistently beat index. That's not my subjective opinion. That's just fact. They also engage in group think and herd behaviour. Again, fact. And on the flip side as a growing amount of money is managed by passive index trackers, price discovery is undermined and you get self-perpetuating share price patterns both up or down. To my mind RPC's SP is a product / victim of these trends. And seeing "War on plastic" every other day in the headlines cannot have done it any favours... Again, all IMHO.
Why? With what agenda? I'm merely providing my thoughts on possible reasons for the recent SP weakness. You can bet your last dollar that Bain / Apollo would not be considering a bid here if they did not see significant value on offer, over and above the acquisition premium that they will pay. And remember that as non-strategic buyers it's more difficult for them to hide behind / generate synergies to justify that premium as they are not merging assets. So either they are fools (and they are not based on their formidable track record) or they are seeing something the market isn't.
Now the bid may well fail because they discover some accounting skeletons in the cupboard. But it may just be that the market has wrongly got itself worked up over creative accounting. A buy and build strategy, which is what RPC were following by definition tends to bring a lot of accounting restatements. Cash flow generation was robust at year end. And this is what the PEs will be analysing. The market has clearly fallen put of love with the company, whether it be over accounting, plastic, strategy, etc. I mean management said as much themselves post results. The point is the market is not always right. Or perhaps charitably the market has a different risk appetite than PEs...
It's not the plastic is bad narrative that has driven the sp down here, but rather the creative accounting the bod have done that has people spooked.
Perhaps you are the one dredging up simple stories as an excuse.
Amazing how the public markets are mis-pricing certain companies. Is it because we have all become so fond of simple stories i.e. in the case of RPC "plastic is bad". As if RPC were dependent on producing plastic straws. In any case thanks to the PEs for once (unlike when they are pushing their over priced / over levered IPOs) for seeing value where others don't. Assuming Bain and / or Apollo ultimately push the button one would hope that the offer price should be at least 900p, and hopefully much more. Based on intrinsic value, broker target prices and typical (30%+) acquisition premia to average 6M share prices they will still be getting a bargain at this level. I'm obviously grateful for the nice, quick profit on this one but sad as management had a credible buy and build story here. But sadly because of gutless, ignorant fund managers it's going to the the top 0.1% via their private Private Equity holdings who really benefit in the long term here and not Joe public.... Rant over :)
Well done holders!
Did anyone see anything in the media over the weekend? For the company to come out and confirm discussions it must be a recent development, good for those with prior knowledge buying in on Friday!
Watched the share all last week waiting to get it, almost got some on Friday but thought I would hold off until Monday as we were struggling to find support in the share price. Then we get some news like this! I Was really looking forward to buying in as well, never mind plenty of opportunities out there
I bought RPC at above 900p last year and some further shares this year. The break-even is just under 880p. I was watching the share price continuing to fall and had set-up a buy last week if it hit 677p. Missed the big rise today by a few pence... :-(
From my simple analysis the UK markets are falling and have been for a while, only now it's becoming more obvious and more widespread. Trumps tariffs and trade wars, the concerns over BREXIT as well as weakness in emerging markets are major concerns and this is why we are seeing opportunities like RPC back below 700. Still it will probably go lower between now and March.
"although RPC claim to be one of the leaders in recycling plastics, its still not an industry you want to be invested in."
There may be something in what you say, but we are here because we know that if we buy shares in unpopular companies there will be the chance to make a few bob on the upturn. RPC does not make drinking straws or baby wipes and in so far as profit forecasts are worth anything (which they ain't) 2019 looks good. So why has the SP nosedived ?
afrc
Your opinion - Why below £7? Are you an investor?
You can see a life without plastic? Get real. No cars, no buses, no trains, no fleeces no so many other things in everyday life without a plastic element.
People are the problem - plastic itself is not the problem - people have no regard for the environment, other human beings or basic rules relating to the sensible disposal of unwanted items - just chuck it out of the car!
I do feel the sp may break under the 700 mark and then all the way to new lows. Sadly nobody wants to know about investing in the plastics industry and although RPC claim to be one of the leaders in recycling plastics, its still not an industry you want to be invested in.
Time was when the markets ran on alcohol and cocaine but now it seems to be down to a bunch of treehuggers.
Still, as has already been said and unless there is something we don't know, the SP should bottom out soon and we can pile in again and make a few bob on the upturn.
After the nice run up from 660 I let my stop loss take me out at just over 800, I have been waiting for a good opportunity to buy back in again. Where the SP settles in the next few days is key, hoping to see around 705 but we have reasonable trend support in the 720 area. So may not go much lower. Don't want to get too greedy and miss the opportunity. Solid company overall main issue is the bad press plastics have been getting the past year or so since the feature on Blue Planet.
I have cashed in. It could just be the market panicking because that is what the markets do, but I will take my extremely small profit and invest in a few bottles of brandy.
Once I have finshed the grog I will return and apologise for being so faint hearted. However, I cannot help but recall that the original Pandies were gallant freedom fighters who were at the very forefront of the movement for Indian independence, but many of them still ended up being blow out of the mouths of British cannon.
Not yet Pandy, but I think I might. This share should not be falling but it is. There is a bit in the movies where the chap bucks the markets and goes homw with baskets of cash and dolly birds. But this is not a movie. If there is going to be a crash then I would rather have some spare cash to pick up the bargains when everything bottoms out.
I think that this is a good share, just the wrong time.
So have you bailed then? Seems like everything is plummeting at the moment. My portfolio is down 25% in 3 months and it was already 60-70% down before that!
"What's not to like apart from the current share price?"
The current share price.
What's not to like apart from the current share price?
I understand that RPC Group Plc is a plastic products design and engineering company. The Company offers a range of consumer products and technical components for the packaging and non-packaging markets. The Company's business is organized into two segments: Packaging and Non-packaging. The Packaging business serves the food, nonfood (including (general industrial, agrochemical and automotive), personal care (mass personal care, cosmetics and beauty), beverage and healthcare ((pharmaceuticals) markets. The Non-packaging businesses design and manufacture molds, molded products and technical components for other markets. The Company's divisions include RPC Superfos, RPC Bramlage, RPC Promens, RPC Bebo and RPC Ace. The Company uses a range of polymer conversion technologies, including injection molding, blow molding, thermoforming and rotational molding. The Company operates over 110 manufacturing sites in approximately 30 countries.
"So why are you jumping ship? You've said plenty of positives in your post. Is it because you think all is not as it seems?"
Dunno Pandy. Everything looks kosher. RPC does not make drinking straws or any other the other unfashionable plastics and so the SP should be climbing. According to my albeit very rough calculations, it should be heading for 880. Instead it is bumping along the bottom at 760-770., so it may be that I have missed something. As I said, I will give the SP a couple of weeks and if no improvement will take my money elsewhere.
So why are you jumping ship? You've said plenty of positives in your post. Is it because you think all is not as it seems?
I don't want to be a downer and I like the look of RPC, but this company has forecast profits for 18/19 that are 25% above the previous year, has an attractive P/E ratio and does not appear overburdened with debt and yet the SP is 11% below the mean for the last year.
I think that I will wait another couple of weeks and if there is no change will jump ship.
This has been one of my best returns so far this yeah, we could be heading for 850 sooner than expected. Set a stop loss at 800gbx but hoping it won't come to that. Quite rare to get such a financially strong company at such a low price!