Ah - here comes the fear. Could be a rocky old day today folks.
My view:
Bid a bit light - nearer £6 for control would seem fair to me.
I want a cash offer, not a (largely) ropey shares offer from some company I don't know. I trust the management here, and if they don't like it, neither do I!
So consensus eps was 94p so 1.08p was 15% ahead (revenues about 4% ahead.). Stock on 8x PE which is too cheap given these results. However, 2 things need clarification:
- Why was the dividend not raised (I suspect conservatism following TT acquisition, plus waiting to see whether revenues pull back next year)
- Exactly what they mean 'moderate' when considering revenue next year. This is critical, as the market expects revs to fall 5% and profits by 25% next year and IG seem to be confirming a fall. Clearly the 5-7% growth longer term is fine, but what will be the 2022 base from which this starts?
The long termers are the ones who make the real money. Unfortunately, they're also the ones that get hurt by value traps and bubbles. The stuff I bought yesterday with my DT proceeds is up about 5% today, so whilst this is extremely short term, I have a big smile on my face! :-) GLA
Little more 'fear' drifting in late morning. Stock flat now. Wonder what the yanks'll do?
If you a partner, do they also have a portfolio? If so you can sell in yours and buy in theirs simultaneously. If they also have stocks with sufficient gains and of a similar value, you can do this at the same time ie you sell DT and us the proceeds to buy stock X, they sell stock X and but DT. Everyone's a winner!
Yep - nice board with informed posters. Well done to all the patient LT holders!
I'm seeing a whole heap of greed, and very little fear on this Board right now. Be careful folks is all I'm saying.......
Still rising :-) I'm happy to leave a bit on the table for someone else at these levels. Still have 75% of the holding of course, so not unhappy if it continues to rise. However, market weakness yesterday has left some real bargains, so want to make some space for these! GLA
...be fearful when others are greedy. Be greedy when others are fearful. My return just went through 100% in 5 weeks. 25% of my holding sold today at 717.
Ah yes - apparently either spelling is ok according to wiki. See Next You Tuesday.....;-))
Most tech is on p/s of 10x or more. MCRO is 0.7x. MCRO share price will be driven by what's happening at MCRO - whether the rest of the industry is being de-rated or not will be largely irrelevant to MCRO sp IMO.
Wonder when Canute became a swear word......? :-)
Well, this along with a bid for DIGS has certainly brightened up my Friday! Lovely weather for the weekend as well - terrific stuff!
* decline stabilisation rather than 'growth' stabilisation.
Lee, to be fair:
- You can't invest unless you have a view on what might happen so chiding YHAL is a bit odd.
- In fact you are also building in what might happen in terms of growth stabilisation by 2023 - what happens if it doesn't?
Au contraire Mark - I think the behaviour of the share price tells you that the level and direction of leverage (and no growth till 2023 as well TBF) was not expected by the market, even if it was by you. Understanding what's discounted in the price overall is as critical as having a view on what will happen. Just saying Mr Market's an idiot isn't really going to cut it IMO. Having considered this more deeply over the past few days, I believe that the market got ahead of itself in terms of growth and FCF, and has reacted accordingly. That said, I this this IS now in the price, so starting to rebuild a position here is worth considering. I'd be looking to add if it falls much further.
Bid announced today, but signposted a couple of week ago - DIGS up about 30% prior to the market learning of the bid talk. Makes Empiric look pretty cheap at these levels. Maybe they'll be next!!
Lee - re your response at 11.23 - sorry, but I disagree. It is not the absolute level of debt, but a Company's ability to service that debt. As interest is paid out of EBITDA (I- interest BTW) then it is the ratio of net debt to EBITDA which is critical. This is why they specifically track it, and refer to it as a measure of leverage. Whilst actual debt is falling, Ebitda is falling quicker (due to revenue decline) and they have already signposted that leverage will increase again in H2. I think this was a significant shock to the market. Look, the stock doesn't fall 30% for no reason. The question now, is whether this is overdone.
Well there we have it - Bid recommended by management at 213p. The question is will others be prepared to come forward? Like you winski, I was here for the long term yield and growth so I'm slightly disappointed, and I don't know whether other bidders will come forward. Still, the price is now underpinned at 213p, so worth holding out for a bit to see what happens I think.