Member Info for Guitarsolo

Whitelye, if anyone can then they are better than I! There is a lot of complexity around VSL although I think they try to explain things relatively clearly. But my guess/understanding about the Bakkt situation is the change to the NAV is related to a revaluation of VSL's investment. It's a fairly dramatic change which results in a circa 7% adjustment to the NAV but if it needs to be revalued, it needs to be revalued.
It might explain why they re-started the buybacks, knowing that there was a NAV adjustment coming!
I tend to look at the monthly return (excl Bakkt) which was 0.99% for January. I cast my mind back to 2016/17 when I first invested here and owing to too many marketplace loans VSL often struggled to make 0.5% a month meaning that the 6ppa dividend was under pressure. So if they can make 1% a month return, 12% a year, the 8ppa dividend is solid and (whisper it) may one day increase!
I do like these guys, they know what they're doing and they've done well. But keep your eyes open and remember who they are ultimately lending to (i.e. high risk).
Guitarsolo

Many thanks Fever and Holla for your replies. Pleased that I dipped my toe in yesterday at 64.6p! It's nowhere near where I would expect to build a holding up to, but averaging up is usually a good sign!
Everyone wishes they could have got into the lift on the ground floor, but if the building is tall enough jumping in on the 4th isn't so bad either!

FeverT, many thanks for your post. It was actually just what I was looking for after Hardman's note put this on my radar. It's very much the kind of company I like - solid fundamentals, strong management and a technological edge without many competitors (you call it a duopoly but there is so much room for ST to expand!).
It shares some hallmarks with another of my favourites, Renew Holdings (RNWH), from where I "know" Rivaldo - always struck me as a very well researched investor!
You say the share price waxes and wanes. If you were interested in dipping your toe in with a view to a building a long term investment, is a price in the 60s a reasonable place?
Many thanks
Guitarsolo

Tom8080; It wasn't an expensive lesson, I more or less came out even and was probably slightly up if you factor in dividends (remember those?).
In 2017 when I bought at 175p it was a minimum investment for me and in retail which I am generally not a fan of. It was a very different world in 2017, but at the time CARD was making nearly £80m earnings before tax and paying a yield of 8-10% incl. the specials. Debt was high at c.£140m or so but the estate was expanding. I didn't like debt then and I still don't. It was a reasonable investment at the time and indeed the share price increased after my purchase.
But there was poor management after that; too much focus on new stores, ignoring the online offering etc. Then a bad Christmas in 2019, then the pandemic.
Card still has several things in its favour, most notably the vertical integration. But there are some on here that think earnings are going straight back to £50-80m. I would be surprised. 2020 is obviously a loss. 2021 will do well to break even. 2022 should be profitable but nowhere near £50m. You've got to look a way down the line before the old profits are reached let alone the targets from the management's pre-pandemic 5-year plan. All the time the debt needs servicing and will act like a drag.
This may go to £1 like Liberium predict (without a timescale), or there may be a serious dilution of current shareholders.
For the moment, I will sit on the sidelines and watch. I've spent 4 years learning about this company so am not just throwing that away. There may be another time when I think it is a good investment again. For the moment I think it is fairly valued.
Good luck to all. And my only request to the BB is for people to be civil and helpful to each other.
Guitarsolo - reaching for the plectrum.

It seems this BB has become a place for rather extremist views, one way or another, along with a lack of tolerance towards others and general name calling. That's rather sad. The best BBs are where people can put forward thoughts and ideas, preferably supported by evidence, that helps others make decisions. Being constructive. In my experience, BBs descend into the playground when share prices become volatile and attract traders rather than investors.
Anyway, I've been invested in CARD since 2017 and therefore had a legacy of a (very) high entry point. I did go in relatively heavily in recent times to more than quadruple my holding and significantly average down. That has allowed me to ride the recent post-pathway surge and more or less exit at all square. I probably never thought I would be able to having held for so long.
Even when investing in 2017, I was concerned about debts but was told the company is comfortable with its gearing. Hmmmm. "Control your debts before your debts control you" is something I learned from my dad. And it may well prove to be the case for CARD.
Personally, I feel a placing, RI or punitive refinancing is likely to some degree. Banks will turn the screw for margin whenever they can! And they can!
Whilst I like CARD's vertical integration (my main reason for the original investment) their well-documented problems will serve as a drag on earnings; expensive estate, late-to-the-game online offering, high debt and (not mentioned enough) recent increases to the minimum wage which has a disproportionate impact on CARD.
I'll watch from the sidelines with interest and wish luck to investors and traders alike! There's big potential here but also risk. Just be careful that you've got glasses with clear lenses on when you're looking here!
ATB
Guitarsolo

Wiscos, of the previous female CEO you did say "....Sadly, she had all the retail wisdom of a codfish, and joins the increasing number of girls who have failed in the top jobs....." nothing like a bit of casual sexism!

We've seen this pattern before, some decent news sparks a quick pump to the share price and then it falls back as if it has completely forgotten the reason for the rise. This has included some huge bits of news over the years (large increases in the size of the resource, successful applications, GALP's involvement for example).
Is it because people are booking a short term gain and waiting for it to fall back to re-buy? If so, I don't think that is many on here who seem more intent on long-term investments all the way to the real fun. That's fine of course but you can get caught out not being on the train when it leaves the station.
I've been invested since 2017 and am still patiently waiting! In fact, I've added about 1/3 to my holding over the last few months whilst we wait, and wait and wait.
Let's hope April 2021 is the month this finally gets some proper traction and gains in the share price actually hold and provide a new base level.
Guitarsolo

Why does it bode well for tomorrow? The share price has done pretty much the same thing for three days in a row, fall early on a stage a rally at the end of the day to end even.

G Money: "why would a bank let a company fold when they are close to opening and have a good business model and has made money year on year?"
Answer: margin! They won't let the company fail, but they will want to increase their return for their support. So it becomes a question of how much will they charge and can CARD go elsewhere (already tried that it seems). Banks are banks and are there for a reason.....

And in a flash today's early morning fall was erased (I knew I should have jumped in). It could just be a desperate seller trying to offload and the market taking advantage of it - like they did to Woodford.
Still, if anyone has any thoughts I would be grateful to hear them. There used to be an investor on ii.co.uk called Soi who was very knowledgeable and willing to share. Shame that website went to pot.

Fellow NCYFers,
Anyone aware what is going on recently? For this stock to fall 10% in 2 days is highly unusual (when not part of a market-wide drop). I can't see any RNS and the recent NAV notices were similar to those that went before it.
I can only think this is concern over bond yields/ inflation/ interest rates. But the move is rather drastic and not a long-term trend that would be more typical. On the back of recent advice that the company expects dividends to remain on trend this is surprising so I would be grateful if anyone here has any ideas.
Thanks
Guitarsolo

Many thanks Caitlin, CDSI, Pokerchips et al!
You've answered my initial query which was whether the projected divi cut is real, it is! Of course there may well be good reason for it that benefits the long term. I would just need to factor that in to my thinking. If I bought in it would be as a long term investor (5 year horizon) so would be to benefit from the rebased then rising dividend if the money was reinvested wisely by GSK etc.
CDSI, I already have IMB, NCYF, VOD, most of the insurers etc - a good chunk of the high yield market! I don't presently have any pharma so should for balance. But I would probably want 6% yield with the 67p rebased dividend - so need to buy at 1120p! That might be a bit greedy, but you never know. And of course I wouldn't want that to happen to existing shareholders, but would jump on board if it did!
We will have to see how it pans out.
Guitarsolo

Mary,
I noticed on my HSBC account that broker predictions of the 2022 & 2023 dividends are set to fall from 80p to 73p to 65p. Is this current shareholders' expectation as well or is this an error on the HSBC site? Is there any discussion around reducing the dividend to rebuild it?
I've been a shareholder before and could be again around these prices, but as I mainly invest for income a reducing dividend is off-putting (even if it is right for the business).
Appreciate any responses.
Guitarsolo

Well said MSM/ Carllapos, I am disappointed by the way in which some have turned on Paddyboy, even blaming him for missing out on "another 10,000" (PaperHands). This game isn't for you if you're that easily swayed but are putting down the kind of money where a 50% uptick is worth another £10k (presumably).
Paddyboy raised concerns about debt, RI etc. Fair enough. If you know the history of CARD you know it has always carried fairly significant debt - more than I like. But you choose to invest or not invest.
And hedge funds are not paying people like Paddy to deramp shares to get a few out of private investors' hands! Paddy has his point of view, that's his prerogative. And we should remind ourselves that the specter of a RI has not gone away, there is clearly some form or refinancing being considered or actually discussed.
Anyone who is holding shares probably has a better feeling than a week ago. Perhaps a wry remark to those who missed out, but no need for the vitriol in my opinion.

Some positive comments about the dividend in the H2 2020 update:

"In the absence of unforeseen circumstances, the Board expects to follow the same pattern of dividend payments as declared last year and maintain or slightly increase the total level of dividends for the year. "

"In the current financial year, a dividend of at least the same as the previous year (4.46 pence) is likely to be covered by earnings. Should this not be the case, the Board is prepared to use a modest amount of reserves to make up a marginal shortfall and anticipates that this will be the most likely scenario for the next few years as well. "

I'm guessing we might get 3 x 1p and 1x 1.47p this year then!

Still, I welcome a degree of predictability and news that companies are paying their coupons/ dividends.

Guitarsolo

Fundamental, why not simply filter Paddyboy1 if you don't want to read what he writes?

Well aren't you pleasant! Filtered.

Darth, no I am not stupid thank you! As I look at my MSc certificate in Chemistry and Biochemistry, whilst running a professional financial services company in the City...... My point is that your comment sought to blame immigrants for mutations whereas mutations can occur in anyone.

Rosewall, you're missing the point. Yes there is illegal immigration, we all know that. There are issues around "un-documented" individuals (that's very American) being less likely to come forward for vaccines (but they'll often be too young for the moment), or living and working in conditions that support virus spread. But Darth's words were that "new variants from being created by 1 million illegal immigrants"....and I was merely pointing out that any segment of society can cause a mutation. To blame immigrants for it is, well, ******! Whether that's casual or not is down to the individual.

"How will UK prevent new variants from being created by 1 million illegal immigrants resided in the UK, alone, god know how many in other countries....?"
Well there's nothing like a bit of casual racism in the morning! I've got news for you Darth, mutations can occur in any segment of the population. Not just immigrants!