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Regarding the comments on the 'rental income increasing': that will not be the case if Auckland encounters financial problems - which is now a distinct possibility, given that they are 6m behind in submitting their financial results.
"The regulator added that Auckland has not demonstrated that it is appropriately managing actual or potential conflicts of interest, while failing to submit its statutory accounts, which are now more than six months overdue. "
I am also a bit annoyed about the timing of the announcement. SOHO maneged to get theirs out by 8am. Releasing it at the time they did is usually done by companies wishing to conceal something. In my experience, it usually results in another drop the following day.
@wishIhadnt: Rather than give advice to other investors (which is illegal), perhaps you should offer something useful, such as the nature of the relationship between Civitas and the CIC?
https://www.investmentweek.co.uk/news/4112517/civitas-reits-largest-tenant-enforcement-action-regulator
Excerpt:
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According to Companies House, Auckland's principal shareholder is The Social Housing Family CIC - the community interest company set up by Civitas, of which Auckland became the first member.
Civitas' website states that the CIC is "operationally independent" with a stated aim to "enable housing associations holding Civitas leases to increase skills and experience and to provide funding if required to promote enhanced performance".
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I am concerned that Auckland are responsible for 15.9% of the rent roll and the opacity of their relationship with Civitas.
"Very few American companies pay a meaningful dividend."
Have you heard of a BDC? Almost all of those pay north of 10%.
"It will be fun to see the reaction when the results are published. What is the lowest PE ratio anyone has ever come across?"
Probably nothing at all... Low PE means nothing... have a listen to the Leter Lynch story about Kaiser. The only cases of ultra low PEs I've come across in the London markets have all ended in the bankruptcy or stagnating share prices.
It remains to be seen whether or not any of the cash will ever flow back to investors.
There was a time that Ince was the largest listed law firm, so I think it should be positive for Knights in terms of clients. Anyway, the technicals for this stock have improved substantially over the past couple of weeks. Maybe it's finally on the rise again? there's no corresponding increase in volume, but hey, maybe the selling has at least slowed for a while.
It's a dud strategy; he's operating on pure *hope*:
"It is to be hoped that the Government will ensure that the fiscal terms applying in the UK North Sea make the UK competitive for future energy investment."
Labour are going to screw him and the investors.
Yes, I noticed the Ince news - that's a shot across the bow for KGH who has followed a similar strategy or acquiring firms and running up debt. Just a year ago I was telling people that Ince couldn't afford the dividend and I was yelled down... but it's eerily similar here! One thing that differs is the depth of the pockets of DB who would be able to loan the firm money if they really needed it.
@Dartron: Most people who invest in AIM shares lose money; most people on these boards lose money or achieve a lower return than the index. Hence I never listen to advice from anybody on these boards... Good luck.
@Dartron: "What a shame you didn't act on it. It has done 16% in 2 days."
Getting in at the absolute bottom or calling the level is a fools game, because it will only be apparent several days after. I watched this for several months and got close - and that's all that's important.
I already had a tiny position, but opened a larger tranche yesterday morning, with a suitable stop-loss of course. I'll exit if it drops back more than about 12.5%, so that the trade offers ~5*R. Getting individual trades right or wrong is unimportant - few on thes boards ever seem to ever realise that...
Yeah, it's starting to look tempting for a punt, with a suitably tight stop in case it resumes its freefall. After another look:
Bad: Volume is still low, there's very limited interest in the share
Good: RSI has ticked up a bit
Bad: It's forming a base, but there's no evidence of any momentum
Bad: Most listed law firms are similarly weak, e.g. DWF and GTLY
Bad: High debt
Conclusion: There's too little to go on and I'm continuing to stay out.
I think we can assume that the dividend will be rebased by 15-20% as in THRL, but even then it would be approaching 9%, which is attractive for new purchasers.
@SD235: "PS who is your stockbroker?"
Hargreaves Lansdown
To be fair, the entire market is melting. It's not just KGH. It's a terrible bear market. They do seem to be following a similar path to Ince though, buying up miscellaneous firms, focussing on revenue - which is a totally meaningless quantity, compared to PROFIT and yes, they have an elevated level of debt. Where is the investor return?
On the other hand, you can argue that there's a great opportunity here if institutions and/or the CEO start buying again.