Member Info for 42trader

Possible Hambro selling as they were the last to report selling back in July? Since then only a buy been registered by OCTUS.
Nothing has changed that I'm aware since I bought and so I have now bought my second trance. Everything is looking pretty positive for the company, low pe,peg, cash strong and the sp below the NAV. Enterprise value £3m below the market cap and forecast EPS set to continue to grow. Broker target of 83p.
Unless things change, I'm more than happy to add if it drops more as value in the sp will show eventually.

The company is doing very well but with the director selling £1.3m, a new high hit, the large debt and PE going over 20 I've decided to sell. Mat re-buy if it drops to 210p.

gla

STRONG QUARTER OF INFLOWS BODES WELL

The notable highlight of Record’s Q2/20A update is the +$1.7bn net client inflow, which builds on Q1/20A’s inflow of +$0.3bn. This takes AUME to $59.9bn, ahead of our year-end expectations. When combined with broadly unchanged fee rates over the quarter, we see upgrade potential should this level of AUME be maintained. We prudently keep forecasts
unchanged today, noting materially stronger GBP this month, which would counter some of this upside to forecasts should it be sustained.

- AUME rises 3% to $59.9bn: AUME now stands at $59.9bn, rising +2.7% on Q1/20A’s $58.3m. Given management fees are charged on AUME levels, this bodes well for the future. The +$1.6bn overall uplift can be attributed to +$1.7bn client inflows (see below), +$1.3bn of favourable market movements (equity, fixed income et al), offset by $(1.4)bn of exchange rate movements on non-USD AUME. The latter reflects that only c11% of AUME is USD denominated, hence FX gains/losses are recognised upon converting the various mandates’ currencies. This includes 57% of AUME which is CHF denominated, with CHF depreciating slightly versus USD over Q2/20A.

- Net client inflows of +$1.7bn, driven by Passive hedging: Record achieved net client inflows of $1.7bn over Q2/20A, the second consecutive quarter of inflows following Q1/20A’s +$0.3bn. The increased momentum arose predominantly from existing client mandates, with Record’s continued efforts to deliver a premium, specialist service rewarded with new commitments. Underpinning the inflow was a significant +$1.5bn rise in the core (84% AUME) Passive Hedging product, as larger clients increased mandate sizes, while Currency for Return also delivered a +$0.3bn inflow.

- New clients added with pipeline of more to come: Two new clients (Q1/20A: +3) were added over Q2/20A, which in themselves can hold multiple mandates. We note the new business pipeline includes a diversity of new names, we believe, of all sizes.

- Performance fees yet to come: Performance fees are recognised as and when a client’s agreed accrual periods ends and a performance uplift has been delivered. As yet, no such fees have been recognised in FY20E, but our £1.3m FY20E forecast
reflects a H2/20E delivery broadly equivalent to half of FY19A’s £2.3m annual result.

- Forecasts unchanged, but risk to upside: Q2/20A AUME is already ahead of our FY20E forecast of $58.5bn, with fee rates broadly unchanged. We consider this gives potential for upgrades should it be maintained. We note however GBP’s recent
strength this month provides future translation headwinds, hence we prudently maintain forecasts, awaiting further clarity in the upcoming interims. A FY20E P/E of 14.3x does not fully reflect Record’s longstanding client base and recurring income.

No other alerts set here Majorboy as the sp is below previous all time lows and my alerts I set are based on support levels.
The stats for this company are very good with a low PE and PEG, high EPS and the NAV is 21.7p, roughly the current share price.
Unfortunately, the debt is the same size as the market cap and the operating margins are very low. So when a profits warning comes, as it has, the share price tanks.
So while the company is taking advantage of a customer leaving and doing upgrades which will prove beneficial in the future, it does increase costs/reduce profit and on top of that, e commerce trading for the company has been difficult.
One to watch imo and wait for a turn around with an increase in the profits.

Today's share price down on the acquisition RNS which is no surprise after the rise on friday, breaking through resistance on what was almost certainly leaked news.
What is interesting is the share price retraced back to the old high and bounced off it. This is a classic move where after a break out the share price retraces back to previous resistance, now support, before continuing to climb. This move is often watched for by traders and a signal for them to buy.
Possible moves from here could be a new side ways trading range of 250-265 while the sp consolidates. Sensible stop losses would be set some where under 246p.

Well surprised to see 735p target on the update but the share was over valued imo. Good point now to buy in and happy to add on any more drop.

Today my second alert has been hit at 23.5p.
Can't find any news out for the continual drop and it looks like the case of slow drop on low volume with the exchange market size of only 3k it will not take a lot to move the share price.
With a new low created, I'm waiting on the sidelines atm. Certainly value at this price but I don't see anything soon moving the share price up.

Nope, can't break that 300p resistance so back to 250-260p level.
It is going to need the funding confirmed to break 300p and not just rumour.
Still, if it is true and the funding is reinstated then this price provides a buying opportunity again. Will just have to dig behind the sofa again.

Barfield has a reputation of acquisitions and then selling companies. He will probably grow the company for the next 3 years before it is then sold.

Interims | Latest purchases highlights attractive strategy
Asset recycling continues at pace.
CLS has unconditionally exchanged contracts to acquire 2 London office buildings for a consideration of £66.65m, excosts. The deal adds nearly 4% to the Net Rental Income and is c3% EPS enhancing in a full year. As a result, we raise our Target
Price by 10p to 310p, implying 30% upside. This brings the total to 8 properties bought this year, with 7 disposals. We believe CLS Holdingsshould be a core holding in any investor’s exposure to the commercial property sector. BUY

6 Lloyds Avenue; 2nd site in East London
The first London acquisition is at 6 Lloyds Avenue. It is a 34,640 sq.ft multilet office in the east of the City of London. It is 72% let to 27 tenants with a WAULT of 2.2 years. There is a clear opportunity for CLS to invest in refurbishment that is likely to lead to higher rents and an improved yield. It is located in an exciting area identified by CLS.

The Clockwork Building, W6
The 2nd is the Clockwork Building that has recently been refurbished, having the pillars and ceilings stripped back to exposed concrete. It consists of 39,626 sq.ft of office space that is 100% let to 6 tenants. It has a WAULT of 3.2 years. It is located west of Hammersmith Broadway and is less than 5 minutes’ walk from Ravenscourt Park tube station (District Line), in Zone 2.

Unwarranted 28% discount to NAV
The combined deals offer a NIY of 6.2%, rising to 6.8%. We have raised our NRI by c4% and EPS by c3% (see table of page 3). Consequently, we have also lifted our Target Price by 3% to 310p which implies 30% upside. CLS is currently trading on a 28% discount to our estimated EPRA NAV of 332.1p.
The dividend yield stands at just over 3%.

Hitting resistance atm, but once it passes it, it will fly.

Being setup for a takeover bid. Will see a rise here on Monday.

Always good to bank profit. This will be a lot higher than £3 once confirmation of funding is secured.

There is the news in the news section that’s sent this up. If it is true that the funding is agreed, Drax will re-rate now.

Manchester (2 projects, 10% of GDV) is expected to benefit from 14% population growth in the next
five years, according to data from Savills (higher than the UK average). Data from Colliers suggests
Grade A rents for Commercial space are expected to reach £40psf by 2020 (vs the £37psf being
achieved today). Management has said that £1psf of rental growth at Mayfield translates to £10m of
profit to U+I. To supply the Residential demand, Manchester City Council is targeting 20-35k new
homes by 2025.
Dublin (5 projects, 2% of GDV) is expected to be the fastest growing European economy over the
next five years, according to data from Knight Frank. Data from Cushman & Wakefield suggests the
supply of Commercial space has decreased 22.5% in H1 19 vs one year ago. €60-65 psf prime office
rent is expected to continue (although not grow as fast as in Manchester). For Residential, 6,924
homes were delivered in 2018, below the demand requirement of 11,000 p.a.
The trading portfolio first targets areas undergoing demographic change
U+I create value in its trading portfolio by first targeting areas undergoing demographic change. It also
helps that management’s ‘in-price’ is, the majority of the time, the result of an off-market transaction.
We were shown a strong example yesterday in Finsbury Park (the Arts Building) where management
bought well, have been able to enhance the use through refurbishment and asset management
initiatives, and expect to achieve a 1.7x-1.9x equity multiple on exit by March 2020.
CY20E P/NAV of 0.52x with an ordinary dividend yield of 3.8% (6.4% inc.
supplementary)
While U+I is higher risk and returns can be lumpy, the updated strategy should increase the mix of
steady returns over time. U+I is clearly committing to its longer-term target of 12% p.a. total returns
and 10% p.a. investment portfolio returns. We currently forecast average total returns of c.6% p.a. on
average over the next three years, which looks attractive when considered against the group’s NAV
discount, which is prudently stated with development at cost. If U+I can deliver on its targeted gains,
the shares offer significant value, in our view. U+I trades on a CY20E P/NAV of 0.52x with an ordinary
dividend yield of 3.8% (6.4% including supplementary). BUY.

Transition of the Investment portfolio; diversifying and increasing the income
stream
U+I’s current Investment portfolio is a combination of Retail, Leisure and Commercial assets. Retail
tenants are convenience and less-discretionary focused. Rents are low as a percentage of tenant’s
revenue (<10%, on average). Affordability is therefore high, and so is occupancy, which drives a
stable income return. While we think that valuers (and the market to some extent) is currently being
too harsh on the value of assets exposed to less-discretionary Retail, U+I will continue to diversify its
portfolio away from being exposed to more traditional Retail tenants. Despite some higher yields, it is
a ‘committed, but patient seller’.
Management has identified up to £175m of regeneration assets that will strengthen the Investment
portfolio by being transferred in once complete (>£50m of which may transfer over the next 18-24
months). Over the next five years, we expect the proportion of pure-Retail assets to decrease from
c.45% of the portfolio today, to <15% by 2024. At the same time, we expect Commercial exposure in
the Investment portfolio to increase from an immaterial amount today to c.20% in five years’ time.
Optimising U+I for the future; reducing overheads and increasing development
management fees
We expect U+I will be able to reduce overheads by c.£4m (-20%) from March 2019 to March 2022.
Management has reviewed its internal operations and implemented new finance and back office
systems. It has removed 130 legal entities, which has reduced accounting and legal costs. Marketing
has been pared back and put in ‘maintenance’ mode, helped by the fact that U+I’s delivered assets
now speak for themselves. At the same time, development management fees (from the existing
pipeline) should increase from £2.5m to £6.5m p.a.
A strategy aligned to macro trends in three high-growth markets
Management look for four major drivers of economic growth in its focus locations: top talent, steady
tourism, good transport links, and tolerance for diversity.
London (34 projects, 76% of GDV) is expected to benefit from 10% population growth over the next
seven years, according to data from the ONS. Data from Knight Frank suggests that in the
Commercial market (i) supply is currently 21% below the long-term average, and (ii) rents in
Southbank, City Core and Canary Wharf will grow 17% over the next five years. For Residential, the
London Plan target is for 65,000 homes p.a. but Savills data estimates the need for homes is 94,000
p.a.

Phase 1 is complete, Phase 2 begins
Phase 1 of management’s strategy has been to focus on investing in and growing the pipeline. Since
FY16, the pipeline has increased from £2.1bn to £11.0bn, a 424% increase. Overheads have
increased 14% in the same time period to £23.0m (largely due to investing in growing the pipeline).
The number of projects has decreased from 57 in FY16 to 43, helping simplify operations. DM fees
have increased 257% to £2.5m.
Phase 2 of management’s strategy is to focus on delivery of the pipeline, and of efficiency in its
operations. There are three main objectives to delivering Phase 2 of management’s plans: (i) delivery
from the existing pipeline, (ii) transition of the Investment portfolio, and (iii) optimising U+I for the
future. We go in to more detail on each area below.
Delivery of the existing pipeline; c.£11bn of regeneration
The c.£11bn development pipeline currently contains nine identified major PPP projects, with a total
GDV of c.£7bn (31% of gross assets as at 31-March-2019). The timing of delivery for PPP projects
(which have particularly high barriers to entry) can vary between 4-10 years, on average. PPP
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developments are often multi-phased, with sales and profit realisation highest toward the end of the
delivery timeline. At this point, there is potential to transfer part of what is delivered to the investment
portfolio, which provides a high-quality income stream thereafter. On average, management expect to
deliver a 5-10% profit on GDV to U+I, at anywhere between a 12-35% IRR. Equity returns can be 2-5x
before any transfer to the Investment portfolio.
Regarding delivery of the trading portfolio, management (24 months ago) identified an opportunity to
capitalise on the decline in Golf participation. Membership of golf clubs has fallen 23% in the last
decade. At the same time, the under-supply of housing has increased pressure on local authorities to
try and hit delivery targets. U+I is therefore capitalising on both these trends by sourcing golf courses
that sit on brownfield/greenfield/close to transport sites and offering up to 50% affordable housing as
an alternative to the current use. There is currently four assets of this type in the portfolio, with
potential for over 1,700 homes. Management targets a c.6x equity return, the bulk of which should be
delivered by 2022.
Crucially, U+I does not need to win additional projects over the next four years in order to deliver
incremental returns to shareholders. It can deliver them from the existing pipeline, and from its own
existing opportunities. On just 6 projects identified at the CMD (Morden Wharf, 8 Albert Embankment,
Mayfield, Westminster Industrial Estate, Landmark Court, CNFE), these are expected to deliver
c.£160m of profit to 2034, and total development management fees of c.£60m across the same tim

CMD: A clear plan to deliver financial targets
BUY
Target price 250p | Published price 157p | *Corporate Broking Client of Liberum
U+I’s CMD yesterday presented a clear vision, strategy and timetable to
deliver its financial targets, namely achieving 12% post-tax total returns by
2022/23. Key tenets of the strategy include (i) delivery from the existing
pipeline (fewer, larger projects); (ii) transition of the investment portfolio
away from Retail in favour of more in-demand sectors; and (iii) operational
improvements to deliver an extra c.£3m of annualised savings by FY22.
We currently forecast average total returns of c.6% p.a., which looks
attractive when considered against the group’s NAV discount, which is
prudently stated with development at cost. If U+I can deliver on its targeted
gains, the shares offer significant value, in our view. U+I trades on a
CY20E P/NAV of 0.52x with an ordinary dividend yield of 3.8% (6.4%
including supplementary). BUY.
A clear delivery plan to deliver financial targets
U+I’s CMD yesterday presented a clear vision, strategy and timetable to deliver its financial targets,
namely achieving 12% post-tax total returns by 2022/23. A long and large pipeline (c.£11bn) should
underpin substantial long-term upside. Management’s strategy is aligned to positive macro trends in
the three high growth markets of London City Region, Manchester and Dublin. There is a need for
regeneration across the UK. 40% of land in the UK is owned by the public sector. With public purses
in many areas empty or running low, there is an opportunity for U+I to work with the public sector to
deliver schemes in areas that are fundamentally under-supplied, but clearly in high demand.

Master Trust status approved for Carey
The Carey Holdings acquisition made in October 2018 for £0.4m continues to deliver as expected, with the auto-enrolment business now receiving approval from The Pensions Regulator for Master Trust status, opening up the UK auto enrolment market to STM. This is a significant step in STM’s transition to a more UK-focused business growing revenues in the pensions division. We believe there have been 39 applications for Master Trust status from a population of 85.
Assuming all 39 applications are approved, 46 Master Trusts will be ‘looking for a home’ among those Master Trusts still in operation, whether newly authorised or otherwise. Sub-scale Trust divisions within larger integrated wealth management
operations are likely to be sold, but not to wealth management competition, suggesting STM is well placed to reap the benefits of these market dynamics.
?The Pensions Regulator approves Carey Workplace Pension Master Trust. STM’s recent acquisition has today received authorisation for approved Master Trust status, allowing it to accept auto-enrolment contributions in the UK. The approval is an important step in the company’s ambition to grow its UK-based pension-derived revenue streams and will allow STM via Carey Corporate Pensions to benefit from increased Master Trust membership sales as a result of exiting sub-scale operators.
?Estimates. We reiterate our revenue and EBITDA expectations for 2019E of £24.2m and £3.4m respectively, but draw attention to the fact that our estimates do not include any upside from the UK pensions consolidation opportunity available to STM, which should start to be realised from 2020 and beyond.
?Valuation. Shares trade on a 2019E P/E of 7x with a dividend yield of over 5%.
There aren’t many directly comparable listed peers, but the opportunity to grow EBITDA through the consolidation play suggests to us that shares are undervalued, given the ability to scale quickly from a relatively low level.
?Our view. Our model assumes that the entire Carey business (both SIPPS and Auto Enrolment) will add £0.8m of EBITDA in 2020E, initially costing £0.4m and potentially aiding cost savings of £0.5m. In cash terms this was clearly an attractive purchase, before we even consider the £2.0m bargain purchase gain. If STM is able to identify similar opportunities in the UK pensions market, growth could rapidly accelerate.
While net cash is £17m, the amount available for acquisitions after regulatory capital is c.£1.8m, enough for 4 Carey-type deals, and potentially £3m of additional EBITDA, over and above our £5.6m 2020E estimate.

Management’s unchanged guidance and ongoing focus on debt reduction were the financial headlines for Renewi at the halfway point of FY20. Continued progress in the company’s largest division plus ATM appearing to be closer to resolving soil remediation issues are the two key pre-close messages, in our view. Other divisions are also performing in line with management expectations. Valuation multiples remain low in conventional terms with earnings and dividend growth expected to resume in FY21 on our estimates.

The end H120 update reiterated the AGM message regarding ongoing progress in the Commercial division sustained by firmer pricing and synergy benefits. There are likely to be general market effects from trading difficulties at AEB in the Netherlands (most obviously, reduced incinerator capacity and reduced refuse derived fuel or RDF intake) as the supply chain adjusts. Renewi’s contractual positions and other mitigating actions taken lead management to believe that there will be little impact on the company during FY20.

Encouragingly, ATM appears to be clearing soil testing hurdles to satisfy the regulator in Holland and a re-opening of the market is expected although no firm date is provided. Additionally, ATM has developed potential markets for separated/graded soil components sufficiently to invest in processing capacity in this area; once certified, these products will aid diversification in end market application and revenue generation for the company.

Apart from a new service agreement at Derby, no further detailed comments were made on UK Municipal or Monostreams, which are performing in line with board expectations. This perhaps indicates greater stability in these two divisions following portfolio adjustments and some management changes, respectively. Other corporate activities, ie green financing initiatives and business disposals, are as previously reported save for confirmation that the Canadian Municipal disposal completed and the initial C$82m/c €55m proceeds were received prior to the period end.

Renewi’s share price is broadly flat year-to-date and yet to regain the year high of 37p seen just prior to the FY19 results announcement in May. On our unchanged estimates, the company’s P/E and EV/EBITDA (adjusted for pensions cash) compress to 5.2x and 3.8x respectively by FY22 with a prospective FY20 dividend yield of 4.6%.