The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
@TerryM1 - I think enough has been said about JL and all his past failings, and I do agree there have been too many to mention, and the outcome of these is why the SP is where it is at now - multi-decade, if not all-time lows. Cost cuts were kicked off a good 12 to 18 months too late, IMO. However, if you're looking at CPI as an investment now the only thing that really matters is what the new CEO can or will do with this remaining business and what levels of profitability (FCF) it can generate in the coming HYs and FYs. That's what the market wants to know and that's all I'm keen to hear about in the upcoming update.
I may give AH the benefit of doubt till the H1 2024 results, but if there's no progress by that time I'll be out for good. Who knows, he may just surprise us on the 6th??
"So where has all the money gone from sales from 1 January 2019 to now?
By the by; NOTHING that any of us idiotic Pilgrims write on here will in the slightest way have an effect on the share price. They are simply the musings of fools...."
On that account, there's no point in anyone responding to your musings, Kipper? ;-) Backward looking metrics are not a basis for stock investments and all that..
Anyway, 2 more trading days and we then might have an initial answer to the business/FCF outlook question under AH.
JL was a failure and the less we speak about his prognostications about CPI hitting pre-rights price soon, the better it is for us - IMO. ALl that matters for the SP is how much FCF we generate going forwards and the rest is just noise. There's plenty of wishful thinking on here, but until that's backed by sustainable cash generation from the business, we won't go anywhere. Using AI as part of service delivery is fab, but is means jackshiite unless we can deliver profitable growth.
Saving CPI from bankruptcy wasn't such a big deal when you look back at it - it needed assets to be sold at a resonable price and that's what we had. It's now pivoting to profits that's key.
On the flip side - Kipper sounds like he just to wants buy more at a lower price as I find some of his comments ill-informed ;-). For starters, JL did buy a decent chunk after the disastrous August update last year - the buy was around the circa 500k volume. And I'm not sure what makes you think that Capita can't announce a material market moving piece of news (a £220m revenue enhancing contract) via a RNS, even if it's in a closed period ahead of results - a head-scratcher, IMO?
Anyway, I'm not here to litigate posters' intentions. I'm long and waiitng to see what Wednesday brings. Backward looking numbers don't matter, to me anyway, but what I'm keen on is to pick up AH's thinking on where he wants to take CPI and how to wants to get there. Maybe all of this won't be forthcoming next Wednesday and we may only know more in August, but that will be about the end of the rope for me if that is another disaster. ;-)
Good luck, however you play this!!
"If Q1 Results are not so good and not much other news comes then the SP will drop again - IMO" - Yes, agreed there PC. I don't think any of us can predict what can happen in the near term with Q1, but the US direction of travel from an economy and business spend viewpoint is more positive than it was during 2023 - pretty much all of economic growth in 2023 was US consumer driven. It's the US business spend greenshots that we should all keep a close eye on.
WPP is a lot more globally exposed (circa 40% is US revenue) and I wouldn't personally consider them as a like-for-like benchmark when assessing SFOR's prospects. But, I do agree that we need to hear from MS about the ad market and tech sector spend in particular, is trending in the US - we'll have that in a few weeks time and that will set the tone for SFOR's SP in the near/medium term.
GLA...
I can't see on what basis a share placing could come in the picture, certainly not after USD debt was raised in H2 last year. There are no large debt maturities due this and maybe a small one next year, and knowing the cash proceeds from the asset sales are in the bank as recently as from a few weeks ago, I'd like to understand what the talk about placing is all about?
There are plenty of probable risks out there and recession concerns are high on that list, but putting a share placing risk on CPI when there are no near term liquidity or debt redemtion headwinds, is just misplaced - all IMO.
"How can glanbia sharp as ever get their full year out for end of Feb whilst Thg waits till snooze fest near start of may"
This is one big reason why I just don't buy that THG will/can list in the US whilst you have the current management running this show. Just imagine the quarterly financial reporting and forecasting that need to be delivered to the market. I can't see these lazy b*ums get around to doing it and hence the LSE is the easiest place to continue doing what they're doing now - the LSE bogeyman punching bag is easily at hand. We wait to be pleasantly surprised though!!!
It looks like MildCat's market abuse posts calling THG a scam were taken down by LSE. I can understand holders being frustrated with the state of affairs at THG from a shareholder viewpoint, but posting blatant lies to suit your trading position is just not on. Hopefully, he's banned for a few days, as I've seen with some posters in the past.
"sells the business to other potential customers" @Trisor - thanks for the post and broadly correct. I never thought that CPI had an issue selling its services to Experience clients even after the hack last year, and these are now a way of life. Government contracts are chugging along nicely anyway. The hack did cause a disruption in H1 as management attention was completly focused on fire-fighting, and H2 was more the Experience division's business dropping off story - recession concerns were plentiful and plenty of other consulting/outsourcing business had a horrible H2 as well.
It's good that we're now seeing opening of wallets from the Experience division's customers, and if that trend broadly continues it just means that there is more visibility of revenues in that division, and that tends to be higher margin business. These are the positives, but I'll temper my expectations until next week and see what actually comes out of the update.
Whilst most welcome, nothing much really changed here on the back of that news, IMO. As I've been saying, we're still in a trading range between 17p and 23p until there's more clarity on FCF generation, and we must really hope to get some more clarity on that next week. If more job cuts (or anything else) are forthcoming to boost margins and FCF, that's what will take us out of that trading range. Fingers crossed.
"Refer to my earlier posts about the EU expansion, this is Corrine Ripoce's lead on the back of high service standards and improved tech." Cheers, Peterr. This is the key difference between the type of (low-margin) grunt work (outsourcing) with low skilled labour that Capita does for Public clients that DDD was discussing a couple of days ago versus the more outcome driven outsourcing that CPI does, arguably more so, for the private sector in the Experience division. It'll be great to see this trend continue with other customers, particularly if they're net new.
The news was leaked yesterday and hence the run-up. ;-) There's hardly anything that the market doesn't get wind of. :-)
"GoCPI is paid to devalue THG"
@Crafty - PIYML. Your boss is doing an unenviably brilliant job with this. Why would I need to pile on any more pain on long suffering shareholders ? Note to myself - Mouldy's PR team wins either way. We just need to wait for the next outrageous board filling message from the PR team - it won't be too long off I wager.
"Obviously sentiment here is on the floor at the moment."
This is the absolute key point for investment consideration. US macro is nowhere close to falling off a cliff - Atlanta Fed's Q1 GDPNow is tracking at 3.3% growth rate for Q1. I think spending will modestly come back and I won't be surprised to see a 100% rise over 2024, acknowledging that it may be a very conservative number with the Olympics and the US elections tailwinds. 2025 should see SFOR do better as the Ad market normalises.
The good old stock market - buy when everyone's fearful and see when everyone's greedy - always works when you take a out of favour sector into account. Do I believe that SFOR will go bankrupt? I think it's highly unlikely and therein is the medium/long term opportunity if you're willing to look past the ST noise.
I know Auson can relate to this - take the oil sector, particularly the US and Canadian ones as we were coming off the Covid recession in circa July/August 2020. That sector was extremely unloved and you could invest in almost any stock in the US/Canada (even the UK before the windfall tax in 2022) and you'd make many multiples of your investment - I held most of my investments and got rid of most of them in mid 2022, a few months after the Ukraine war started. I personally believe that this is where SFOR is sitting at - in an unloved sector that has experienced recessionary conditions in 2023 because of recession fears that is looking unlikely to come about, and spending in this sector should trend upwards as we move through 2024 and beyond. All IMO.
What's happening here - surprise, oh surprise. A global e-commerce giant contemplating an LSE listing? We need more of these and quickly, to save good old Blighty.
https://uk.finance.yahoo.com/news/shein-edges-closer-london-ipo-074353120.html
If my favourite light-weight posted something positive today , it must be because he ready DDD's post today and re-purchased what he sold last week. :-) If you read DDD's post about the state of outsourcing in the public sector and look past the noise, there shouldn't be any massive surprises on the order book side on the public side. And Capita is giving up on low margin business like the Teachers' pensions contract lost last year to an Indian outsourcer. That's the way to go.
10 more days for us to get a first sighter of Adolfo's vision of where he wants to take Capita and what that means for us shareholders!!!