Hi,
Card could easily clear their debt in the next 2 years (or more likely re-negotiate the debt to a lower rate) and then it can focus on:
1) Creating revenue growth in South Africa. Another purchase is likely need to implement their business model here. Hopefully another cheap one.
2) Dividends can then be reopened after 1 or 2 years depending on interest rates on debt/ debt reduction.
The financials (EPS) came in lower than I expected 12 vs 15 and cash flow was only 'okay', which keeps the SP down for now but I believe now is still a very good entry level for the medium/long term. Debt reduction at the current higher rates agreed will compound into benefits for future cash flow.
A lot of wider market uncertainty in the short term which could impact Card but if anybody truly knows where that is going then please give me a heads up.
GLA
The new shares created do not add any additional value so dilute current shareholders & share price by 0.03% (so very very small). 1,050,000 / 343,000,000 = 0.03%
The shares are created to reward key employees to stay for a set period of time e.g. if you stay 3 years we will give you shares as a reward.
Just run a comparison of CARD vs MOON.
Caveat we do know the latest CARD results, but not MOON's so I am using historic.
Moon
MCap £441m, PE 21.5, EPS 0.06, Revenue £300-370m, EBITDA £63m, Cash £100m, Long Term Debt £170m, Cash generated LY £45m. SP -33% 1yr.
Card
MCap £375m*, PE 8-10, EPS 0.15, Revenue £360m, EBITDA £112m, Cash £38m*, Long Term Debt £110m, Cash generated LY £107m. SP +88% 1yr.
*Card should easily have the same market cap as MOON +20% (I would say higher), Card free cash needs improving hopefully the results improve this.
This is a strong buy IMO Moon is a lot smaller and weaker vs Card than I thought before doing this.
Another thought would be that if CARD has good results how does this affect MOON, does this indicate card is winning (stealing share) or the whole card market has seen a bump up since Covid?
GLA
Agreed, I originally came here for the low cost, high cash flow, disruptive style of the business.
we are both indicating up…… just different styles for how high… I enjoy the maths and logic once I’m already sold on the company. It’s not for everybody.
Should be another green day tomorrow. GLA
The 16 PE currently is too high for Card (calculated from a bad year with some post Covid hope) and the industry average, using 10-12 is more realistic.
But things can always run hot and let’s hope it does, the chart shows no resistance up to 1.60. I wouldn’t sell at 112 here personally, 125 should be achievable based on numbers.
Okay I found the reason for the drop in Jan 2020:
Card issued a profit downgrade due to a bad Christmas and stopped paying dividends.
So being back at £52m earnings and an EPS of £0.15 is likely to give us an increase but its unlikely to be +£1.50 unless they reintroduce a dividend, which could come with the results (fingers crossed).
GLA
The SP hit 80p on 29th March....... (after I sold 1/3 of my shares at 92p)
By buy order didn't execute as ii do manual trades from orders. But was very close to fully plating out.
I still hold 2/3 so am happy and it all profits from previous trades.
Card is one of my best performing shares.
I agree its under valued, but why did it drop to £0.90 on the last set of numbers like this (pre covid) EPS £0.15 = £52m.
It will put the PE ratio to 7.7 which is very low and SP should be £1.50+......... I will top up if it dips nearer to £1.
But I will investigate the Jan 20 results when I get time to
GLA a great day for us holders.
Last time card had results like this was announced Jan 2020 and that is when the SP fell from c.£1.70 to c.£0.90 ??????
After this was also the Covid drop down to c.£0.30.
Why did Card fall so much on the Jan 20 'Good' results anybody remember.
I think this is great news but trying to see why we wouldn't jump back up to £1.70'ish/share.
Argo Labs is all very vague from what I can find.
I would like to see more detail on what they are doing there. Scale of investment (I hope its small), projects invested into, investment dates etc.... I believe that gaming and Web3 have a good opportunity to drive substantial adoption in blockchain adoption but are they making 'good' investment choices, and not risking a cash burn that impacts the mining operations working capital.
So a 4% increase on the split per below values.
Hopefully DWL gets purchased soon.
Yes they need to focus on cash, but overall an 'okay' update and taking more control/ownership of the global business.
I was hoping for a bigger impact from the 'China reopen'. The statement made keeps their cards close to their chest.
I now have a small holding here and will buy more on any small dips.
Looking forward to them performing well over the next couple of years, there is also a small chance that they are taken over at some point.
GLA
Well I didn't expect to be out in one day thought it would take longer to get to 100.
profit shares kept in for the long term bag.
Topped up, planning to exit the top up £ at 100'ish and keep 25% of the shares to Hodl.
I believe other competitors to CARD would close their doors before CARD do, and even though they may come under stress, they will be the longer term winner.
I am looking for 80 to top up, but the chart gap has already been filled so it may not make it that low.