The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
By "dropping like a stone", presumably you mean 20% up since interim results ten days ago, followed by a drop of 4% following a 4% ex-div yesterday?
There will be more volatility - that's the nature of this stock - but I can only see it further strengthening before full year update and results.
Just take a look at the company's cash position - both profit and reserves.
Looks like the buyback is now in full swing with £487k bought yesterday and £397k the day before.
A combination of buyback and wider market softness should help the SP to bounce back from the ex div dip.
I'm looking forward to the next trading update - only the minimum 60% of net profit was returned to shareholders; I would expect excess to be returned as a special dividend after EoY results (the interims allude to this), which could be an attractive incentive for new investors.
To gauge the drop: interim divi 4.8% yield based on yesterday's close (3.8% after full rate of WHT retained).
Yesterday also saw £398k of share purchase through the buyback, so expect to see a repeat today to take advantage of the drop.
Yes
In the past you've been able to claim a rebate from the 25% rate of WHT to the 15% reduced rate of WHT for non-israeli residents. You've never been able to claim the full amount back.
It looks like the full rate of WHT has been reduced from 25% to 20%, and there has been an automatic rebate applied to those who received dividends and paid the full rate of WHT in the last round. I've not seen anywhere whether the reduced rate of WHT has also been lowered - it would make sense if it has, as the aim of the reduction is to avoid double-taxation and the rate of dividend tax in the UK is unchanged. I expect there will be an RNS or the information on the website will be updated in due course.
I suppose whether it's worthwhile applying for the reduction depends on how much you have invested here and how much you value your time! If the reduced WHT has also been lowered (to 10%?), then applying for the reduced rate essentially would increase what payout you actually receive by 12.5%. If it hasn't been lowered then you increase your payout by 6.25%.
Fine - so that implies that standard WHT has been reduced to 20% and that it's the reduction from the previous 25% which is being rebated.
The further reduction from 20% to 15% for non-israeli tax residents would still need to be applied for as usual through the agent.
That's still odd, as the WHT reduction is from 25% to 15% - so not sure where the 5% comes from. I'll drop ESOP an email.
As an aside, the only tax reduction I've seen is in corporation tax (to 12% from 23%) as PLUS has successfully been recognised as a preferred technological company. This will clearly improve net profit going forward and therefore increase dividends, but shouldn't retrospectively affect declared dividends.
As far as I'm aware, the withholding tax hasn't changed and still requires the individual application for a reduced rate (link above).
You do have to apply. Process is a here:
https://www.plus500.co.uk/Investors/Dividends
I don't think Credite Suisse would publish the exact methodology which they use, but I assume it's based on some sort of MACD indicator. That's what my company uses to buy energy, which has a similar requirement of a given size of purchase over a fixed time period (albeit a given number of 'units' rather than a set monetary value).
It generally means purchases happen when the price plateaus or falls. I guess we will find out in due course. At the moment it's good to see such momentum without the buyback kicking in - as mentioned, it should provide good support to the SP going forward.
12 Aug RNS just shows how many shares were bought in a 45 minute period on the previous day - before the SP rose by 10%.
Look at the RNS from 11 Aug for details of the full buyback.
As Mark says, agents (in this instance Credite Suisse) have algorithms of varying complexity for automated buying of shares. Don't worry - we'll see plenty more purchases in due course!
I would encourage you do to a bit of very basic maths, Blackrock.
Big handfuls maths.
250ish trading days in 2020. I went with 130 days for the buyback without calculating exactly (as it starts mid-Aug and ends at the end of Feb).
$67.3 buyback ÷ 130 trading days ÷ 1.3 apprx. USD/GBP = £398k per day of share purchases.
Ask me another.
Or, more likely, funds which have limits on what percentage of their portfolio they can hold in one instrument. Increases in share value can therefore force a manager to sell, even against their own analysis.
As mentioned, the SP absorbed the sales quite easily and we'll now see apprx. £400k of share purchases per trading day in the buy back helping to support the price.
Surprised this board is so quiet - quite a contrast to a couple of years ago!
Yes, purely based on the chart. No change in fundamentals, so would consider buying in again at a lower level (preferred, clearly!) or if it breaks through resistance.
I'm only in here post-covid crash, so it owes me nothing.
There seems to be quite frequent £/$ confusion on the board - remember that results and updates are quoted in dollars. £1bn revenue is unlikely; $1bn is possible, though I think we'll fall just short ($900-$950mn on my estimates, with EBITDA around $750mn).
This is still an EBITDA of around half of market cap. Even if this year's volatility is a one-off, it will have a massive effect on shareholder returns and the company's cash position.
My estimates on 7 July were for $240mn of shareholder returns in H1 results, with a $1.33 per share H1 dividend and $100mn buyback. There is a lot of focus on the size of dividend (well over 10% annualised and after WHT). Don't forget, however, the effect of the buyback - at current prices, PLUS would buy back about 12% of its own market cap throughout 2020 on my figures, which will also give support to the share price as volatility reduces.
Based on same operating costs in Q2 as Q1, I have EBIDTA of around $400m. If net profit is in the region of $350m, then H1 shareholder distributions come out at around $2 per share (assuming adding $150m to PLUS' cash at the bank of now near $500m - it may be that more than 60% of net profit is distributed, based on this).
My estimate is H1 divi of ~$1.33 per share and $100m share buyback. This gives about $240m distributed.
That makes no sense Taverham. Customer trading performance is expected to be broadly neutral over time (although favoured PLUS as reported at last trading update), with PLUS making consistent revenue from spreads, overnight charges and so on. Therefore, more customers and more trading activity means more revenue.
It's taking quite a hit, but I've added here again this afternoon. I think the hit is due to IGG update being in line with, rather than exceeding, expectations - IGG also had a rather muted reception.
We know that our trading is ahead of forecast. When you take forward EV and earnings rather than Market Cap for your PE calculations, this is a well undervalued.