Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
On the rise now, I thought the briefing they gave today was very positive. Emma came across very well, she certainly seems to know her business well. In the current volatile market, I see GSK as a relatively safe haven, 5% dividend and a SP rising to 1400+ will do nicely.
I suspect a few of the plonkers will be gone soon. Basically I don't see much point buying back in for the long term, no dividend and not much prospect of a quick rise to recent levels. Could be good for day trading.
The CEO's conference call recording (see RNS) is worth a listen if you are a LTH. Sounds like it will take a few years and Capita will emerge as a smaller and very different company. I think they realise the outsourcing market has changed and they need to reinvent themselves and improve their delivery. With no dividend and probably reduced profits for a year a two, I'm thinking that the share price could remain depressed for quite a few months?
Does he know what he is doing, or is he throwing out the kitchen sink and dropping the SP to make himself look good as the SP recovers. Do they need £700m share issue when they are making £300m profit and suspending the dividend? All seems very drastic.
In my experience these large outsourcing contacts are not awarded to the lowest bidder. They are awarded on a combination of Quality and Price. The problem is Capita and others became very good at writing Quality Submissions which scored very highly and helped to win the contracts. However, Capita' s operations never match the quality in the bid, which results in poor service delivery, poor financial performance and unhappy Client's. The company culture is awful.
A famous book my Ernest Hemingway., which I read for my O Level English Literature many years ago. Tells the story of an old fisherman in a small boat who hooks a giant Marlin. The boat is pulled out to sea by the giant fish, and he drifts aimlessly for days. Just like this share.
2017 trading results will be published. I think SP will climb above 400p if results are in line with expectations, and much higher if there is positive news from the new management about bid pipeline and market conditions.