Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
We await confirmation clearly but the approximate 90 per cent decline in Robinhood share price peak to today suggests things may not be exactly plain sailing for Tasty Trade to put it mildly and of course it was bought on a multiple miles higher than that of ig at the time and even more miles higher than the current one. A lot of US businesses were booming on the back of a tech share boom and must surely have suffered. However, we do await to see what has happened to Tasty Trade.
Agreeing IG looks cheap but plus way cheaper still. IG has paid so much for Tasty and there must be a concern that Tasty clients were too geared into highly speculative shares that have come crashing down. Volumes away from highly speculative shares and crypto have been great.
Consensus estimates now updated to show around 2.5 usd per share or 2 pounds per share for this year and next. Could well be awfully low numbers but at least higher than they were. pe on these numbers around 8 but valuing the cash at par gives a way lower pe.
If the company bought back 10 per cent of its shares it could do easily do this out of cash reserves. That would have all but zero cost to earnings. The number of shares would reduce by 10 per cent and the earnings per share increase by about 19 per cent and the pe drop by about the same. Eventually the share price would presumably respond with a 10 per cent rise. Surprising they do not do more than a few per cent each year.
Almost everyone on this board who commented on the tasty trade deal said at the time it was hideously overvalued and now we are seeing it. They diluted a good business on a cheap rating to pay way over for something making a lot of profits out of some stupidly overvalued US shares. The ceo should resign. Plus 500 looks way cheaper than IG and has huge amounts of cash and buys back all the time. Mind you IG does not look expensive. It is just what might have been.
Plus is likely to have done so well out of all this volatility and the pe on last years earnings is around 6 and are those earnings going to fall. I am not convinced they will and do not think by much if they do.
From management point of view it seems crazy not to try to either take the company private or be doing much more of a share back. The current one is a tiny percentage of market cap.
If I were plus management I would just announce a new buyback to benefit from the market cap drop of over 100 million pounds likely being way more than the impact of any litigation, including any reputation damage.
This case actually started in 2018 with one disgruntled client claiming losses from a trading halt of tiny amounts in a Plus 500 context and then widening to claim 29 million dollars from a class action. Even 29 million dollars is under 2 per cent of the Plus market cap if it ever came to that sort of result.
I think the latest figures could produce quite some uplift in price quickly as they are so way ahead of estimates and there was a lot of worry about the sector after the cmc warning. If they do not provide much uplift one surely can afford to be patient with this type of yield and per.