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Completely agree, Mick.
Vertu (along with Lookers maybe even more so) is one of the cheapest shares on the market.
In fact I can only find Bisichi plc that I would put on a more absurdly low multiple of current and future earnings.
Valuation - many thanks to Zeus for publishing an update note this morning, on Research Tree. It has pencilled in 15.8p for FY 2/2022 - a PER of 3.6! This is best ignored though, because it’s a one-off.
Next year, Zeus has profit more than halving, to £35.4m, anticipating sales conditions normalising, and higher overheads. This is the more relevant figure to value the shares on, in my view. So at 7.5p, this is a forward PER of 7.7 - which looks highly attractive to me.
Particularly when you also factor in that the balance sheet has net cash, and is full of freehold property.
My opinion - as shown above, even if we adjust out current extremely positive market conditions, VTU shares still look very cheap.
The current share price is at a discount to NTAV, which doesn’t make any sense to me. That implies that the company is making unproductive use of its assets, which is clearly not the case. So I think the market price for Vertu shares just looks wrong (ie. too low).
The dividend yield is about 3%, plus VTU is buying back its own shares, thereby enhancing EPS, with another £3m buyback announced today.
There has also been takeover activity in this sector, so further upside could come from that.
There’s so much to like here, so I remain a firm holder.
Looking at the chart below, I might usually consider banking some profits. However, the fundamentals are so good, that it doesn't make sense to sell a share which is this cheap.
https://app.stockopedia.com/content/small-cap-value-report-wed-2-mar-2022-placeholder-943615?order=createdAt&sort=desc&mode=threaded
Earnings upgrade and share buyback.
Excellent news.
There year end is February, Come on next divi paid in June
Nice top up today .
I see from previous years that Vertu have normally released a trading update in February or March. Can anyone confirm if one is scheduled for this year?
It would be an attractive business to buy. The share price has full asset backing and you'd get your money back in 5 years.
Now that would be nice.
Former Lookers insider takes a 20 per cent stake
Constellation Automotive Holdings has snapped up 78mn shares in Lookers (LOOK) representing approximately a 19.9 per cent holding in the auto retailer. The bulk of the shares were purchased by Tony Bramall (and associates), who stepped down from the Lookers Board in December 2020 after a lengthy tenure. Shares in Lookers have gained 23.4 per cent in value over the past five trading days. MR
Glad to see it recovering in the last week. Was getting a but concerned.
Yep.
Meanwhile in other parts of the distribution sector, both wholesalers and motor traders reported sales above seasonal norms – and expect this trend to continue next month.
https://www.proactiveinvestors.co.uk/companies/news/972322/ftse-100-to-slam-into-reverse-as-fed-chair-turns-hawkish-972322.html
Maybe when NT does his update we'll see he has sold.
Just can't get my head around what is happening to the share price. i know markets had a bad day but this is a good company
The market cap is £233m and the forecast profit is not less as than £70m which is a PE of a little over 3. That does seem low. What the PE is when the market returns to normal is the big question. You would think the present fall is just a blip caused by profit taking at 75p followed closely by a general market fall. Is anyone aware of any other reason for the fall?
They seem to have made a mistake in the diary page. If you click through to the company details https://www.sharesmagazine.co.uk/shares/share/VTU/fundamentals and scroll down to Dividends, they have it correct there.
I wish I had some inkling into the recent price slide. VTU looks great value at these levels. Good assets, solid profits. What's not to like?
KrispyDuck your knowledge of this seems to better than the Market Diary section of Shares Magazine which is where I got my information from and definitely showing todays date as an ex dividend date for Vertu. Like yourself I am therefore at odds also in accounting for todays drop.
Point of order: Ex-dividend was 16 Dec. Today was just payment day so doesn't explain todays share price fall, unfortunately.
Another one banked
73.8p
Car price inflation is rampant as computer chip shortages still persist
When you take the freehold of 6m into account it doesn't seem like they have paid a significant price for this. Using the excess money for a combination of share buy back, acquisitions and dividends seems like a good balance.
Too many taking profits today
Top slicing I suppose
And yet it was impossible to sell 20,000 over 70p this morning