Member Info for MarkBellUK

Warren Buffett has a saying about the stock market and investing in general: "Be fearful when others are greedy and greedy when others are fearful."

Morning!

Lets put it this way Im starting to understand whats going on with revenue and the mix up with missing loss vs revenue etc..

"The industry is in disarray after the ESMA leverage reductions and, for many, the extra costs of providing negative balance protection to all EEA retail customers. Plus500 will be the only company maintaining its marketing spend this year, and it is logical to expect that to lead to extra market share, as it always has done. Its level of new customer acquisition remains extremely high, and a spend of the $108m we forecast is very significant.
A note on elective professionals. They need to be replaced. They have more money than retail customers, but can and do use more leverage, so they do churn, even if their lifetimes are longer than for retail customers. EPCs cannot immediately be acquired, rather they will almost always be recruited as retail customers with [a] the required level of liquid assets and [b] on their way also to qualify on the grounds of their trading frequency. Plus500 has, with this new customer recruitment level, the means to replace the first batch of EPCs. Competitors will find this tough."

Warik I cant forward the note its part of a subscription package and every page is water market with my name and email!

PS Zcc the revenue was really $82m but they are now deducting the $28.1 loss to customers. I dont think did that previously which led to the loss of $102m? in 2017 suddenly appearing.

Extract "We expect new customer numbers, already strong, to improve through the year as competition weakens. As a result our 96k new customer assumption is unchanged. We reduce our quarterly customer churn assumption through the rest of 2019, since that should be the result of the lower leverage being employed. Active customers would therefore rise from 97k this quarter to 114k in Q4. Spread/ overnight charge revenue comes out at $420m, minus the customer P&L just recorded means $392m. Our revenue estimate for the remaining nine months of the year has come down 7%, from $365m to $338m, driven by a lower ARPU assumption.
Note that such estimates have no market share growth, nor anything from new licences. Our only growth assumption through the rest of 2019 is an ARPU mix improvement.
This analysis has however one big flaw; that Plus500 is a business in which 9% of the customers are 91% of revenues, meaning that ARPU/ AUAC analysis is not intuitive, since the skew is so big. Cross-checking with recent results, we had $95m of spreads revenue in Q3 2018 and $99m in a volatile Q4. Q4 spread revenue would have been higher had the customer P&L not been so strong in Q4. It’s important also to remember that customers made money (pre spread costs) this quarter, which bodes well for Q2.
Post 2018, the company guided its joint brokers to $460m of revenues for 2019. In line with more normal practice, it has not now guided to a number, however the statement in this release “too early to draw conclusions about the full year outcome” means that this central planning scenario is unchanged. We have just had a really weak quarter. If any of Q2-Q4 is like Q4 2018, then the 2019 outcome will be different."

I appreciate they are the house broker but that also gives them more of an insight that most.. Its 10 pages long and lots of honest negative points on there as well

Much happier after going through the full note...shows they now estimate full year income of $386m with Profit before tax of $196m

"A low volatility quarter combined with clients making money (pre spreads) to mean very weak Q1 revenues at a third of the level of Q4, however new customer numbers are good, and spread revenue ARPU only down 14% on Q4. The $28m of client P&L takes 6% off our revenue estimate, and then it was a very weak quarter anyway. We take Q2-Q4 estimates down 7% (lower ARPU assumption) and end up with 2019 revenues 18% lower and EPS 26% lower. We still believe this company will continue to take share and to make great returns, so use 10x this year as a price target, or £10. Note 32% of the market cap in net cash by the year end. Lots of options, and an 8% yield while you wait."

..And revenue may have just bottomed due to regulatory changes and Q1 might turn out to be the worse quarter of 2019 when its using the best Q..its just all up in the air

What is for certain is that the BOD knew about this long ago and could have better cushioned the blow starting months back..I think we see / need to see more buyback support asap.....

2013 with an operating profit far less than 2019..expenditure will now be tightened..heavily unless revenue picks ip

Considering they made $50m on a revenue of $115m with a lower operating profit than today, I'd say the chance of zero profit is ridiculous..unless of course anyone is aware of long term contractual bound outgoings?

..expenditure/ wages etc in the region of $80m I reckon..Where they have spent money is on expansion and system improvements

Comfortable £100m profit 2019 even on a gloomy outlook for me

What do the shorters think?

Denby the problem I now have is what to base anything on.

What I am surprised is it dropped on open to 495 with a volume of just 153,544. Clearly the sellers & shorters need to dry up but my concern is will the holding fund/s start to sell this after such a revenue impact or will they wait until full year estimates

Bottom line is, I now cant put a price on it when the revenue is all over the place. IF they can achieve $220m+ this year then yes 600. I need to see the broker notes. Cancords revenue estimate was $377.8m. Bernberg on moving to hold @ 770 have said "While we do not think it is correct to extrapolate first quarter over the rest of the forecast period, we elect to be cautious and have downgraded our estimates. However, we acknowledge that a swing in market volatility and thus trading activity could increase profits materially," analysts at the bank said

Order book is 303.5K BUY / 134k SELL

As for those worrying about zero profit after overheads, one of the few positives left is the 70% operating margin....

312k / 125k I must do some other work now mate...I got companies to run!

BERENBERG CUTS PLUS500 TO 'HOLD' ('BUY') - TARGET 770 (1800) PENCE

For me its affecting, but its only money...watching my dad slowing dying of vascular dementia..now thats affecting me...this is just money..its not my GOd

Sorry to hear that giro...thats why I always say never use LIMIT orders up or down,,the fudgers know the levels then trigger and hit

BUY weight 289k / 122k

Still 280, 024 vs 110, 571..mms quoting OVER mid price..they expect further movement upwards

Hope you used PLUS ;) We need all the revenue we can get!

Volcano can I interest you in mine for 800? They are special ones ;)

fyi threeput = downnotout = shorters

Easy 550 from this intrday ffs!

wrong move