Key Risks11 Jul 2020 19:21
What do people feel are the main risks associated to this share?
For me, the number 1 problem has to be the level of complaints that are building up against Amigo! 9k in the backlog and volumes increasing on the a daily basis. Given the fact that this is at the forefront of media attention, will no doubt generate a high level of interest from CMC’s who will just bombard Amigo with a constant stream of cases for a long time ahead.
Now let’s look at similar companies in the high cost short term credit market like Wonga, Sunny, Wageday Advance etc who have all gone out of business because they didn’t appreciate the detriment of complaints can have against their businesses. JB doesn’t do any favours for the company by challenging the FCA or FOS as their stance with irresponsible lending is very clear and will hold companies to account that have not conducted their practices in line with their expectations.
Secondly, it will be interesting to see how and if the number of shares dumped by JB will constantly be bought for the remaining amount of time. It’s a huge volume being dumped each day for retail to soak up and time will tell if this can continue. DYOR and GLA