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Hello again, Paul. It appears we have similar interests; not just with PDL. The good news today will definitely help break the bear trend. From my own analysis of the share price chart, i agree SGC needs to break 340 to break out of the negative channel it has been caught in. Its well on its way and its looking positive!
In my opinion the push through 340 today with the results published suggests an end to the previous bear trend, providing the price closes at these levels later today. Do others agree?
Stagecoach may be clear to rule Scottish rail but their share price isn't clear to rise. Very peculiar...
Stagecoach clear to rule Scottish rail: Stagecoach has promised not to manipulate travel markets in the east Midlands or in Scotland north of Edinburgh as a result of winning the East Coast Main Line rail franchise between London’s Kings Cross and Inverness and Aberdeen.
So I was right about the reason, and pretty petty it turned out to be. I think the Competition and Markets Authority were at it! http://www.lse.co.uk/AllNews.asp?code=kryyk136&headline=UPDATE_Regulator_Mulls_Stagecoach_Undertakings_On_East_Coast_Rail_Franchise Now we should see a decent rise.
Absolutely no idea! This company is in a healthy state, excellent balance sheet, and recent rail gains to boot. If nothing else, this shows how wrong markets can sometimes be.
Anybody have any idea what is going on here? This is from the Winston View, but there is no explanation why the price is so low. "Shares of Stagecoach Group PLC (LON:SGC) ended negative in the recent trading session as the selling pressure continued unabated. The shares faced an erosion of 1.69% or 5.8 points in their value. The opening price was 344.6 and wide vicissitudes forced the price to the extreme levels of 347.33 and 337.1 respectively. However, according to the closing data, the last trade was called at 337.3 while the number of shares traded touched 928,400. The previous close of the price is recorded as 343.1. The counter has a 52-week high of 416.9 and the share price has a yearly low of 332.8."
I suppose I am guilty for starting the pants on hedging of fuel prices, but let's get this straight now. Hedging is a mechanism to offset rising fuel prices, not falling ones. Whenever have falling fuel prices adversely affected the share price of a business like this when fares are set. The price drop is likely to be due to the general retrace and the excuse this time is the investigation into the joint bid. This is the lowest price for over a year.
I understand they may have hedged fuel prices at a price HIGHER than they are now but not sure if or when prices rise this will have little effect of sp.
Spot on regarding fuel prices. As previously noted, I believe around £3.50 to be the expected current level for this share. Should head upwards nearer the £4.00 mark later this year due to East Coast and other positive factors, subject of course as always to the many other external factors.
A little research shows that Stagecoach, like many other operators, hedge their fuel costs for several months or even years in advance - they do not just pop down to cheapest pumps to fill up. While this does give them some stability in the cost of the fuel they use it does mean that when prices fall they may well be using fuel bought up to a year earlier at a higher cost. What they will be doing now is buying fuel for future use at todays cheaper prices, meaning they will not be hit as hard when/if prices rise, and may be able to hold off increasing prices for a while. In their Interim results of 10/12/14 they state "The Group’s operations as at 31 October 2014 consume approximately 399.2m litres of diesel fuel per annum. As a result, the Group’s profit is exposed to movements in the underlying price of fuel. The Group’s fuel costs include the costs of delivery and duty as well as the costs of the underlying product. Accordingly, not all of the cost varies with movements in oil prices. The proportion of the Group’s projected fuel usage (excluding any fuel required by a new East Coast rail franchise) that is now hedged using fuel swaps is as follows: Year ending 30 April 2015 - 83%, Year ending 30 April 2016 - 63%." So they had already hedged 60% of the fuel they were projecting to use in the year to 30/4/16 before today's cheaper prices.
Nice to see the downturn levelling off, with ex div date nearing but my main reservation is the fall in price whilst fuel has been at such a low rate. Consensus of many is that fuel will rise shortly and that this may affect sgc in the short term.
Agree there is a link, but we reached a new annual low on Friday and with no other justification for this, there is bound to be a disconnection and change of trend. Consensus of buy with target of £4.18 from brokers.
This share tends to be dragged down by the worsening performance of First Group. Having said that, it soared on awarding of the East Coast rail franchise to Stagecoach / Virgin in November, rather early as revenues do not start till 2015/16 year, and has probably found its correct level for now. Company is in very good shape.
How can Stagecoach shares drop at this time? Fuel prices are at their lowest for years and they must be raking it in.
overdone as usual
Stagecoach profits dip as transport group warns U.K. bus incomes will fall, as it reports flat half year profits: Transport group Stagecoach warned of lower earnings from its regional U.K. bus operations and U.S. business but said its share of Virgin Rail operations should help make up the shortfall, as it reported flat half year profits.
Although no expert, I have looked at the interim results published today & can see no reason for this negative interpretation by the analysts. This is dragging down other share prices in the same sector, (FGP down by 2%).
intrim results today http://www.digitallook.com/cgi-bin/dlmedia/rns.cgi?action=news&rns=1&view=full&story_id=22302460
Why this huge drop in price? Market is up & trading is thin. Not a normal performance against that background!
Two good news at once : winning contract and cheap oil. Yipee!!!
I am grateful SC and Virgin have won this deal. East Coast currently do a good job and are top of a customer satisfaction survey. I wouldn't say they are great, just the best of a average bunch. Trains are usually on time. The customer service is very good. The only downside would probably be customer comfort and an ageing fleet (trains are around 25 years old now).
I know it's all political but SGC are the right choice to run East Coast. The UK gov must think we are numpties to believe the French were in line for this. Oh how gratefull we are Camerooooon and Co.
I need to top up but not at this price surely will slide a bit soon?
Stagecoach sales hurt by London traffic Transport group focusing on growing earnings from bus routes where earnings come from fare-paying passengers amid cutbacks to concessionary prices