The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
Oh charty i didn’t realise you relied entirely on my posts ..you really should do your own research..yes i think you do understand correctly that the market has suddenly decided through financial engineering that the company has considerable value above and beyond how it has been valued for months ..well done for keeping up. Bless.
Charty
I’ve been explaining what happens to the cash per cash figure accurately ..unless you think that £26m divided by 200m is not 13p. Since the market valuation has been around or even at a discount to cash for the past 6 months it seemed reasonable that the cash was a basis for valuation as there was no value placed on the as yet unprofitable organic business ..something commented on by the company and research. That valuation was not mine but the markets.
So the figures provided were accurate ..how the market reacts and the fact that surprisingly the company is active in the market immediately after the corporate action may be short term factors. We will see.
Its all an interesting exercise on how you can turn a company with no enterprise value into a smaller one with £20m enterprise value in the short term just by returning excess cash to holders ..that was at the smaller end of commitment expected…when there has been no change in the expectation of commercial traction or anything else just a balance sheet event and some ability to mop up any small selling. I’m not sure achieving such a rerating has been achieved or held onto in a capital distribution before!! It is magic!
The 17p estimate of like for like valuation is still there these things don’t change ..there are other factors at work in terms of where the shares are now which have been mentioned..those who subscribed for over 38.5% unable to deal and the fact the buyback has started at a level not commensurate with the pre premium distribution level..it is far higher.
The fact in quantity and that the buyback is paying these levels in indeed supporting the price.
Ngr you sold some to buy back in the teens ..why has it not fallen to the level you expected??
If you sold because of the unchallenged like for like adjustments estimates you read on here then that explains a lot.
Xenon i think you are correct, there is no sensitive event with the actual transaction booking taking place today it is the admin around the event , though it should be a trigger point for any disclosure announcements whether pdmr’s or other. Still think it’s odd immediately after a significant corporate action to be in the market supporting the price but i guess that is what the intension was rather than just tendering for £33m of shares. See how they get on with that but the only way they will get a genuine rerating is more from proving commercial traction than playing the market.
The company has property lease liabilities of over £100k per month…no £10m factory asset I’m afraid. Think this came up before.
They have property plant and equipment assets of £1.3m last interims but that might go up with latest capital expenditure they have mentioned.
Flying high
A reference to 13p is the cash per share following the fully subscribed tender ..if you are quoting me. I made it very clear. Runcorn is a rented property i understand..but they do have plant and equipment worth a few M true.
The balance of the assets are the same as pre the distribution when they were valued at nothing ..so they are now valued at something at current levels.
TG2D im unclear what date they need to disclose…i doubt it is at the payment date..the shares will have been sold tomorrow..that is the transaction date and notifications should follow within days of that i would expect…the settlement date when you get the money is not the reference point.
The average daily volume of Nanoco Group PLC shares traded, based on a rolling last 30 days, is 431.8k shares.
The average daily volume of Nanoco Group PLC shares traded, based on a rolling last 30 days, is 431.8k shares.
Source researchtree
In terms of the buyback the amount that can be purchased is relative to the amount being paid. There is authority for an amount but there is also a limit on cash available.
So ..” the company to buy up to 21m shares today” ….is not the case at 21.5p the company could only buy 14m shares in total…to buy 21m shares with £3m would require a purchase price of nearer 14p..which is a bit off the mark right now. Worth watching volumes short term . Also it is unclear when we might find out if any changes in major holdings but should be notified this week i guess we might find out if any oversubscribed and maybe if some below threshold didn’t subscribe at all and there should be official confirmation of PDMR dealings imminently.
Ngr ..the theory the share price was mostly supported by cash ..was not a theory it was demonstrated by months and months of trading at around the cash postion. The cash position post the fully subscribed tender is £26m ( pre on market buyback) with 200m shares outstanding so the cash has fallen to 13p per share. If the market suddenly decides that the organic business is worth more for no obvious reason then the tender a balance sheet event will have given the operational side a rerate..nice work for no news..but I believe that was all part of the plan. Will it work??
I questioned the FD about timing of the buyback relative to the parameters set a GM ..ie a basis around average over 5 trading days after he confirmed that the buyback could start yesterday..i also asked a few very reasonable questions around forecasts in edison and Cavendish approved research ..haven’t heard back. So i see the buyback starts today and will be based around pre settlement averages..dopey imo.
No it doesnt really work like that imo…it is all around the entitlement date and now we know the subscription was more than fully subscribed ( makes a difference as many thought it would not be) then it should be factoring in the ex entitlement..as said not sure if ordinary folks can deal in the balance of their holdings as of yet especially if they over subscribed.
Ngr
They are trading ex the entitlement now ..so the adjustment should be getting factored in..its unclear to me whether folks who participated in the tender are free to deal in the balance of their holding or not..if you have sold up to 69% at 24p you might want to sell more here as an average ?.might be a factor?