focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
@sparky - I agree with you that the market should be looking 6-12 months out but this share is not following that logic. in my opinion.
Where I see the bad debt figure working in our favor is that is currently forecasted at 7.72% by SP Angel and 7.2% by Liberum - circa £21m in SPangels broker note...... I don't believe it will be that high and for every 1% lower than the forecast it will deliver circa £2.6m to the bottom line profit..... This I think will be Yu's "white rabbit from the hat" in January to smash the current (Nov 22) forecasts and to provide for a larger dividend than forecasted (3p). I think it will be more like 10p+ a share off the FY22 results and then a larger dividend at H123 time (Sept 23) after they have paid the 2023 ROC payment as this will be in the region of £30m this year. (£16.5m last off £155m TO - Liberums broker note confirms that value). If they deliver that then the value for current shareholders will be immense....as per the 2022 interims and Bobbys statement "As we continue to enjoy the fruits of our hard work, I look forward to delivering significant shareholder value in the near future".......
IMO, DYOR
Again a great post SNN, I think Liberums comments on bad debt are interesting, as they assume bad debt is going to increase to 7.2% FY22 - but make the comment that this
could be a source of further upside - hinting at a lower number and better margin….
I think FY 22 will finish between £265-270 max and i also agree that hopefully will consolidate over the next few weeks to the £4 area and then onwards from there in January.
After smashing market expectations for 2022, If YU deliver close to their target of £500m TO with 4% EBITDA in 2023(page 15 of their investor presentation), there will be £20m profit before tax… that would support a share price north of £10… so the potential is huge here for share growth and real dividends.
A really big trading day, with a lot of selling this afternoon bringing us back down a bit, but the trading update was great and a month earlier than expected and hopefully will now see a slow steady rise towards Xmas. The final trading update in January will really push the share on.
Liberum have increased target price to 712p and SP Angel released their broker note as well and increased TP to 635p. Both are only forecasting TO for 2023 in the range of £325-£330m - which I think is very low as YU have a target of £500m for 2023. There is still a long way to go until YU is valued appropriately.
Really pleased to see the early Trading update and very positive - really like that "Overdue Customer Receivables remaining stable and proportionate to the growth of the business" - hopefully means bad debt will be much lower than the 7.1% they provided for so freeing up more cash.... Should see an update on the brokers notes soon as well.
I expect the trading update to be earlish in January, they will have a very good idea now of where the numbers will be by YE and with the board wanting to ensure a share price of £5 by the date of the YE figures coming out in March to get the maximum share options they will want to ensure that there is enough time for the markets to digest the trading update and drive the share price towards what it should be.
Yep, great post SNN, I hope that they deliver numbers in the region you are expecting, but I would be very happy with £280m this year and £450M+ for 2023. Both of which would provide a valuation many times higher than today.
I am not sure, I think the recent coverage / exposure from the likes of Stockopedia, Librum and Vox (nice article today on YU as an ESG winner) as well as breaking through the £50m Mcap has brought the share to the attention of more PI's - we seem to have a steady small volume purchases - which is great news as these investors will be here for the long term gains / value that YU has to offer.
It is a good questions and one that only YU can answer - what we have now is on page 15 of the September 22 investor presentation where they change the wording clearly from £500m Vision to £500 target for 2023 @ >4% EBITDA. The only comment they make is "Significant confidence in high revenue growth based on increased forward contract book". Now if YU delivers (as I expect them to do) a T/O in 2022 of £260-£280m then they have a bit of a stretch to get to the £500m but if they get closer to the £300m that Sparky is expecting then the £500m looks more achievable if they continue the current customer growth rates. Either way, TO exceeding the markets this year is easily on the cards given the Interim figures and so the TO for 2023 will be significantly higher than what the markets are currently forecasting. All of which support at least the current broker ratings of £6+ IMO and DYOR
I agree Sparky, the trading update from Sept and the interims in the same month all point toward a good H2, just a question of how good. As you say with the bad debt provision in place alongside the £300m mark to market hedge position the company is set to deliver value to the shareholders.
Really good to see some informed posting here after a week of ramping - I for one am really pleased to see the Government backing UK ship building and HARL will benefit over the next 12 months as the FSS contract becomes clear.
Definitely some good sized trades today, will we see the £50m MCap broken this week....(£3.02 needed).
If my memory serves me correctly it was May 2022 data.
Figures from previously were
Premier Miton Group 1,024,266 6.18%
Jamieson Principal Pension Fund 1,006,691 6.08%
Data from end September. So quite a sizeable increase from Jamieson.
I think there are 2 games afoot here, YU are likely to deliver £260-300m FY22 and the board want a share price of > £5 for a 20 day average after the results next April to obtain the full share vesting. This creates the need to maintain the share price growth over the next 6 months. If YU release good news too early there is always the chance that the share price won’t stay above £5 when they need it. I personally think when the FY figures drop with the probably dividend payment of somewhere between 2-5p £5 is a realistic price. The exact divi will depend on how confident the board are with H1/23 figures - I think the majority of divi will be declared in Sept 23 once H1 2023 are out and once ROC payment made to be on the safe side. The one thing I am confident of is that there is a great opportunity here to be involved with a growth share that is highly likely to be paying good dividends over the next few year, if YU get to £500m @4% EBITDA then that’s a serious amount of cash to potentially be shared over 16m shares.
It would be good to see the price push through the 301 point to get the MCap passed the £50m point, but I am quite happy to see a slow and steady rise over the next 4-5 weeks before Xmas.
Thanks SMT, at 7.4% there is the real possibility of a significant bottom line gain if it comes in lower.
also they will have a better handle on the bad debt figure by waiting a bit longer - with £7m+ provided for if I comes in lower then that's a big jump in profits.
As much as it would be great to have some news this week, I think it is more likely to happen in December once they are more certain of the YE figure exceeding market expectations as well as EBITDA - they have ultra cautious with RNSs since they sorted themselves out and for a further 4 week wait I am happy.