The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
It's assumed that vaccine means return to normal, (short term correction today, no more volatility tomorrow). Anything that benefitted from covid (plus, zoom, just eat) is going to go down on news of a cure/vaccine
It's also believed plus customers tend to "win" when markets move up, although I've read elsewhere they are more balanced lately.
I'm not sure whether the excitement is a little premature...here's my maths from pfizer's publications....
94 people have got the virus who were part of the trial of 44k people. 50 percent were given a placebo. Pfizer assume the odds of getting the virus in a year for an individual is 1.3percent. it's being going for a little over three months. So without a vaccine then 140 people should have contracted the virus (1.3percent x 44k x3/12 of a year), so it's significant but probably too small a sample size to say how effective it is.
Crudely if it's 100 percent effective then 70 people. Where as it was 94.
((This is all very high level analysis with tiny data sets))
Couldn't see anything on it's effectiveness at different ages but I did only skim read it. (If it doesn't do much for over 60s for example then it won't be very effective at stopping the NHS and other countries health care systems from being "overrun"). Being able to successfully vaccinate the older population is very important as it's the old people likely to be require hospitalising. So the fact they haven't mentioned it's effectiveness in the older population means the data is too small to draw conclusions yet. It was intended that 40percent or the people were over 55 years old so with more time this should become apparent.
Source of most my info....
https://pfe-pfizercom-d8-prod.s3.amazonaws.com/2020-11/C4591001_Clinical_Protocol_Nov2020.pdf
So in the mean time for plus, further volatility is my guess.
The 47m is within the 723m, it would be terrible accounting practice to state your cash balance but exclude some cash you own.
They are sayig 150m to be recognised in 2020 & 2021, but that doesnt mean the cash isnt already recognised at Q3. The P&L impact hasnt been shown anywhere in the accounts yet, but thats because they havent stated a P&L, only EBITDA (which doesnt go down the P&L to the tax line).
If you are updating forecasting models be sure not to double count this $150m. within the 150m is 2020s Q1-Q3 income tax saving, where as previously i believe they were only referring to rebates rather than savings.
I dont quite understand why they are saying it will be partly recognised in 2021 though given the 150m relates up to 30 september 2020, i can only think this is because they tax liability isnt settled (in cash) until 2021, but it would recognised in the 2020 P&L.
But yes large dividend and or share buy back coming i'd assume. Although I also assume that the cash they want to keep is proportionate to current customer balances on account, with deposits being in the region of 2-3 higher than normal then the cash balances are going to want to be higher to weather out volatility given they don't hedge anything
I understand what you are saying Olig, but I would rather transparency. Or at least the FD to proof read the RNS to see if it makes sense.
I've had a response from Rob, he has basically just cut and pasted some of the RNS.
If some other people could also email in to ask them to confirm how they expect Q4 to be their worst quarter in 5 years please could you do so. I think this is the most misleading trading update I've seen.
Rob Gurner
Head of Investor Relations
M +44 7825 189088
rob.gurner@plus500.com
So. "Full year forecast in line with analysts expectations." I.e 830m.
This means q4 revenue is expected to be 49m. You have to go back to 2015 to get a quarter with such low revenue. I doubt this is true.
I think the month of September was exceptionally good.
Cmcx half years show they did 200m from April to September for cfd trading, previous half year was 85m.
Apply the same factor to plus and that gives revenue of 233m for q3. Although I suspect plus will do better than cmc as it did during the height of covid. So i'm gyessing in the region of $275m - $300m for q3.
Looks to me like revenue is up, so are costs. Revenue is not going to stay up once volatility returns to normal. Costs are semi fixed people costs. These will remain in place.
So margin in the not to distant future is down. So share price is down.