Member Info for Ghostrider007

just joking. I actually find it very helpful to hear counter arguments and the possibility that Plus have lost money (on the book) so far in 2021 is quite high.
I'm surprised by the extent of Cannacord's downgrade but always interesting to hear the arguments for and against.

thanks for pointing out, his questions were clueless as well.

Apologies. Bitcoin/Crypto is tradable by certain customers (just not in the UK). I should have mentioned that.
But, as referred to in the webcast, one of many products rather than a dominant force.

I could possibly understand a "hold rating" while we wait for investment plans to be presented and for markets to normalise.
But, a sell rating and large P/T downgrade seems strange. The analyst was on the webcast and one of his questions seemed to suggest that he felt that Plus will lose money in Q1 as a result of enhanced book losses.
At the same time he also asked if Plus had been losing money to customers in Bitcoin and Gamestop (neither of which Plus make markets in according to my search 30 seconds ago).
Also, his view is a little crystal ball territory as we are still a long way from the end of Q1 and a lot can still happen.
Not sure I have much faith in the Cannacord analyst to be honest and don't think he knew that much about the business judging by his questions, but good click-bait for them and might suck in some commission.

Just listened to yesterdays webcast.
Pretty much word for word from the press release and nothing new (as you would expect).
More interest in the Q&A than last time, Cannacord, Jeffries, Autonomous Research, Liberum all on the call and asking questions.
Interesting one from Jeffries asking if Plus are planning to launch a digital bank, which sounds a bit ridiculous and was dismissed easily by management.
I would say a professional and conservative approach to the call and basically "business as usual" .

Really good results and some useful outlook notes. I wouldn't be surprised if Plus have been employing a targeted hedging strategy for a while now, but still good to get it into the open.
Seen a summary of the Liberum "upgrades" ..
FY 2022 Revenue being upgraded by 2% to £445m, or 50% down from FY 2020 (a).
What Liberum are basically saying is that Plus are likely to lose all the customers they added in 2020.
All a little strange tbh, but their P/T still implies decent upside so not that big a deal.
Great company, great numbers, growth opportunities everywhere - cheap on every metric, and paying a healthy dividend.
We will get there in the end!

Hi I12, I've been buying a few more this week and continue to add to a position I have built over 11-months now, and I am basically flat as it stands, which is staggering considering that this business is in overdrive, or should be.
My recent chats with various Plus followers all end up at the same conclusion.

On fundamentals, the valuation is insanely cheap. PE of <5x, prospective Div Yield of c10% at these levels, FCF Yield of 30%, buying back shares, record active customers, record average deposits, $600m + in the bank (prob a lot more), chance of a special dividend....etc...etc...(ps. all based on Liberum forecasts which are suggesting a 50% decline in FY LFLs)

What is stopping people buying is essentially three factors:
1) Management. A few legacy issues and general sentiment towards Israeli companies is fairly low, but - totally unfounded in my opinion. New CEO unproven and will take time to put his mark on the business.
2) FCA/Gov intervention - Does the FCA like CFDs/Spreadbetting , No. Could they shut the whole industry down, No - but, they may start putting tougher limits on leverage and KYC processes - which would hit Plus, IG, CMC etc...I think IG's recent decision to suspend new account openings is a thinly veiled attempt to impress the FCA and avoid censure.
3) Hedging strategy - Plus are exposed to book losses in a way CMC and IG aren't. With Bitcoin going vertical and recent activities in some niche markets I would imagine we are all a little concerned about how the P&L looks.
I only hope that Plus have the people and the systems in place to mitigate serious damage and have implemented some risk parameters to avoid being hit too hard by the recent retail frenzy.

Plus suffered book losses in Q4 and these may have continued into Q1, but they will still be making a nice return on funding charges and commissions and when the market tanks (which is will, its crazy it already hasn't) Plus will be well positioned to reap the rewards . Happy to own, happy to buy on dips and generally a very happy, if slightly bemused shareholder ....

Tesla buying Bitcoin. Price up +8% at time of writing.
All a bit strange and I would be a bit concerned if I am a Tesla shareholder. I need to read more to understand the rational .
However, our interest is Plus and I was relieved to see that Bitcoin is not one of Plus500's most traded markets today.
I am increasingly aware that Plus seem to turn the tap on and off these markets. I noticed that Blackberry and AMC were effectively used as loss leaders and Plus will have done well as the Reddit heat comes out of both names.
I am very very interested in client win / loss ratios for Q4 2020 and Q1 2021.
Fascinating environment for a company like Plus.

Completely agree P_T - they will be gaining new customer and holding onto old ones.
I reckon all key metrics will be in-line or possibly ahead of 2020...
Its just a question of whether the clients are winning , or losing.
But - it remains the best hedge I can think of. In the event of a significant market correction Plus will undoubtedly make a lot of cash.

Board reorganisation announced this morning.
Would have preferred it if the new appointees had been known names to the UK Plc audience but Plus500 is an international company and I'm sure the new Directors will do a good job, and will uphold their fiduciary responsibility to all shareholders.
But, perhaps of most interest is the appointment of Sigalia Heifetz. I had a quick skim through her CV companies and the recurring theme seems to be that most are controlled by Access Industries in some shape or form. Access is the investment vehicle of Len Blavatnik, who I am not aware has any interest in Plus? Unless I have missed it.
I can only hope that Sigalia has been sent in by Access to work out the lie of the land ahead of a very large investment in the company.
Interesting.

They have a calendar link on the website which is helpful
https://www.plus500.co.uk/Investors/FinancialCalendar
Details of the call / webcast (if they have one) will be published in the Prelims RNS on the day...
No guarantee they hold a call, but fingers crossed.

We will hear from Plus regarding Q1 actuals in April , and we may get a little guidance from them at the Prelims in Jan. But, the key is consensus and whether Liberum will have to upgrade following Prelims (in close period now).
There is a view that Liberum's numbers are very light.
Markets are designed to reflect the expectation of events. Sometimes waiting until news is too late. I'm happy to take the risk, and hopefully to reap the reward.
But - get your point rHatton and agree that the new CEO is taking a conservative approach to communication. It's just a shame that the company is off the radar.

I had to Google Zulus, and landed on Jim Slater who I have followed for a number of years and have been equally impressed with his son Mark.
I'd be interested to know if Mark Slater is a Plus500 shareholder?
The Zulu Principle seems to apply well to Plus.
Bought more today and will continue to add at around these levels. A significant holding now and happy to run the risk!

Plus is one big contradiction!

I have gone away and had a think about Plus and about risk. On their website Plus have a dynamic table of "most popular bets", which is obviously where we need to look for risk .
I have gone through the list and have noticed recent markets have appeared in AMC and Blackberry, both of which are in the "most popular" table.
I trust that Plus have the people and technology to mitigate risk and shouldn't have been blindsided by recent events but I imagine there is some trepidation given recent moves. See below for Jan 1st - present day (rough numbers):

* AMC - +560% (but Plus haven't made a market until recently)
* Blackberry +120% (but no market until recently)
* Oil +11%
* Natural Gas +20%
* Tesla +15%

On the flip side - Gold is down 5% but most of the popular markets are blue and may explain why some investors are unwilling to take the plunge and buy Plus shares.

Always good to take the other side of an argument . But, hoping Plus500 haven't been caught out.

Apologies if I have posted twice today, IT issues.
In answer to your point. Yes, we know everything we need to know about FY 2020, and the disappointing book losses from Q4 are reflected in the share price. The share price is trading below Q4 2019 levels which doesn't make any sense.
While we know everything we need to know about 2020, we don't know anything about 2021 so far, and that is the point.
January is likely to be the busiest month in Plus500's history and if they can avoid ongoing book losses it will be the most profitable month in the company's history. As mentioned yesterday, I was relived to find my Silver bets heavily restricted (1000 lot maximum) which should mitigate some risk around surging niche / social media markets.
If January is as busy as expected and outlook is materially higher (or lower) than consensus guidance they have to tell us. And given Liberum's forecast are discounting 2020 as a one-off , their January (and FY) estimates are based on 2019 normalised levels, during which period Plus500 had less that 50% of its active user base.
Its like comparing apples and dogs.
Liberum are forecasting 50% drops in all key metrics for 2021.
If January is as busy as we think it is there is a chance that Plus get somewhere near FY guidance in Q1 and Liberum will have to substantially upgrade.
Obviously risk remains around trading losses, but I can't see any other risks and as discussed, on 5x how much downside could there really be from these levels. ?

They have to tell us if current trading is materially ahead or behind guidance.
FY results irrelevant as you say, but current outlook and new active customers will be a huge indicator of what 2021 looks like.
If active customers continue to grow as we expect them to Liberum's numbers look well below.

I hear you and feel the same way at times. But, I am taking solace in that we only have 16 days to wait.
If they have done their conkers - we'll find out..
If they are smashing it - we'll find out.
Either way. Not long to wait.

me again, sorry.
Just read something that made me chuckle. AI just read a report from a UK Fund Manager commenting on an IPO he just bought into. He finished his summary by saying that the valuation was too good to ignore.
PE 14x, the dividend yield 2.6% and the FCF yield 6%.
Made me chuckle....
Plus is on c4x, 9% yield and a 30% FCF yield - and all premised on Liberum's joke (sorry, conservative) forecasts for 2021.
Buying more!

Thanks OOS and some great intel this morning.I just wish there was a bit more interest in Plus. I was genuinely shocked that the management webcast attracted so few attendees.
re: Hedging. Its such an interesting debate. I completely agree with the statistical argument that casino's use - aka "the house always wins", but - I don't think these are normal markets and I don't think we can rely on what happened before happening now. . If a casino starts losing money on a particular table, or to a particular customer, they don't think twice about shutting things down and making sure they are protected. I just hope Plus take the same approach.
These are unprecedented times and we are witnessing current market forces that defy statistics. I love the Reddit effect but Plus needs to make sure that they protect themselves in niche markets. I bought some silver this morning and was quietly relived how expensive it was, Plus are not rolling out the red carpet which is good to see.
We have 16 days to wait, but I wouldn't be surprised if current trading isn't breaking records and setting new ones. I just don't understand the valuation.