Member Info for Mr_Rooster

With no medical solution and lockdown exit plan in the horizon, don’t know any unaffected businesses. Any suggestions? For short term Plus500 or IG may be fine but I think that would be temporary once all gamble- minded traders gone broke. I am only invested in BT as they may be least affected and are financially stronger than vod or talk.

Good point Fleccy, with my very limited financial knowledge, I think this rally does not make sense. If companies are unable to provide a financial outlook, how they can be valued. Even defensive stock like tobacco and utilities are at significant risk of losing revenue. Anyway, I came across a few factors causing the rally, mainly backed up with anecdotal evidences but quite a few sources pointed to the number of new investors coming to market eager to bag apparently bargain stocks. I saw this in WSJ and recently in FT (Surge in investment account openings on UK platforms). Probably, a mixture of nativity and sentimental rise. Also saw an article in WSJ today, an interview with Charlie Munger (The phone is not ringing off the hook). In his word, they are just sitting on their arses until it gets calm as nobody in the US or world has experienced anything like this.

“ So the morale of my post is - follow the herd and you will make money.”

... and one day you may get crushed when everyone is running for the exit door. This is like playing Russian roulette one will be millionaire but many lose their shirt along the way. I occasionally enjoyed following the herd but only risked a small money. For me fundamentals, dividend and viability of the company in long run are the most important criteria.

Thanks Velo, as always well articulated post.

'For what it’s worth I think the shareprice is way too cheap right now'

Yeah, that's the spirit Toff !

Toff
‘ But bear in mind the SP is the truest reflection of a company’s value and health. ’

I do not think this is true. Always there are insanity in the market which creates opportunities. Otherwise, only people with inside knowledge could ever make a dime. Just in a last few weeks a loss making company's share went from 5p to 500p on the perception that they are one the only two producers of covid test kit. While during the same period, the company issued 7 million new shares and sold to the rally, decreased treasury shares to 4000 and none of the managers increased their very small holdings in the company. You've probably heard about Pump and Dump. Big cap companies with squeaky clean balance sheet like Enron and recently NMC went up so much because the crowd did not want to see or hear what they did not like. Although it was written all over the place they are going bust.

Debt…… Money is cheap and as it looks it may become even cheaper, with negative and zero interest rate bonds, so why should BT opt for right issue? Also in the budget, £5B government grant has been allocated for the fast broadband, which BT would get a slice of it.

Toff,
What do you see in BT that makes you think they are in "terminal decline"? How is that different for Vod or other telecoms?

Apologise, did not know it would get smashed like that. I try again hopefully is readable this time.


BT
Year ending: 31/03/2019
Revenue (£m) 23,428.00
Profit before tax (£m) 2,666.00
Adjusted EPS (p): 26.30
P/E ratio 8.50
PEG n/a
EPS growth (%) (6.00)
Total equity 10,167.00

Share price (p) 120

AstraZenica
Year ending: 31/12/2019
Revenue (£m) 24,384.00($m)
Profit before tax (£m) 1,548.00 ($m)
Adjusted EPS (p): 103.00
P/E ratio 92.2
PEG n/a
EPS growth (%) (39.00)
Total equity 14,596.00($m)

Share price (p) 7708

I know it is comparing apples to oranges but at what point we should draw a line and say, ok I think share x is too expensive? Just copied some data from HL website, too lazy to extract from reports. Both have quite a similar level of debt. Looking at the last 5 years, profit in AZN went down YoY while for BT remained flat.

BT AstraZenica
Year ending: 31/03/2019 31/12/2019
Revenue (£m) 23,428.00 24,384.00($m)
Profit before tax (£m) 2,666.00 1,548.00 ($m)
Adjusted EPS (p): 26.30 103.00
P/E ratio 4.51 92.56
PEG n/a n/a
EPS growth (%) (6.00) (39.00)
Total equity 10,167.00 14,596.00($m)

Share price (p) 120 7708

I can see how articulate you are and how you communicate your logic in civilised manner. Did you get your BS from ****ashire uni?

radioheaven this is way above your education level to understand the approval process. Bert you did not even know what WHO by last week. Anyhow, people like you are bread and butter of stock market. Go an an invest more, love to see this share at £20 or £50.

Abbott test is protein based and is more advanced compare to the NCYT. Abbott has already developed two test kits and this is their most advanced kit. IMHO, NCYT kit is just a marketing stunt and a desperate move to get some governmental funding. They will be back to 6p in few weeks.

Fair point Risehall, the risk is high but let's see which direction it goes. Good luck to all invested here.

"Mr Rooster, why do you think NCYT has been invited to join AZN & GSK (two Pharma behemoths) at the top table!"

They were not invited to the table, it is a collaboration with AstraZeneca, GSK and the University of Cambridge to take action to support a national effort. If the kit was so unique, complete and had commercial value, Astra and GSk would be fighting over the kit instead of collaborating and the University of Cambridge was not needed.

"This is THE gold standard, 100% accurate test. Potential for billions of sales. Nearly every country in the world will need to test their citizens (and not just once) for life to return to normal. WHO approved now. This is truly a once in a lifetime outlier share (they do happen, people!)."

This is a very dangerous comment! Do your own research and consider the risk factors carefully.

As far as I understand, the kit is not novel and is not patent-able. Patented components comes from other biotech companies. They designed primers and produced a master mix. It is like buying pasta sauce and make microwaveable pasta dish. Primers cannot be patented because these are simply a copy of small pieces of DNA from naturally available organism. This kit provides convince, so they do not have much room to increase the price as if they do people may opt to prepare the master mix by themselves.

There is up-scaling issue here too, as they do not own any liquid handling robot. So many technicians needed to run the test. This has been clarified on the WHO website as well, see below or google it if in doubt.

“The genesig Real-Time PCR Coronavirus (COVID-19) (Primerdesign, United Kingdom) is an open system more suitable for laboratories with moderate sample testing capacity, while the cobas® SARS-CoV-2 for use on the cobas® 6800/8800 Systems (Roche, United States of America) is a closed system assay for larger laboratories."

As you can see for testing 100,000 per day, Roche are best placed and they are trusted by biotech community.

This is not "gold standard", RT-PCR is error prone and has sensitivity issues, especially if the infected person is at early stage of disease. This types of testing will be obsolete as soon as protein based tests and vaccines are produced.

There are discrepancies for volume traded today between websites. Hargreaves reports 67m, lse.co.uk says ~15m, Yahoo.finance is 25.5 m and London Sto.Ex is 26.7 m with closing price of 124.15. This seems to be an over the counter trade, so we may hear about it tomorrow. Any ideas anyone?

Isn’t it amazing...
Tesla is up 20% in two days on the news they can’t pay rent.
Boeing shut production last week and rallied immediately after making the announcement.

Market sentiment

https://twitter.com/masasoncap/status/1249692842957721605?s=21

“Today’s lesson - stock markets operate in a different time zones to the economy. (as in weeks & months)”

Toffee, you are confusing chart reading with stock market.
Economy is the base of stock market. Stock market trades future macro & micro-economy. Have you ever wondered why companies post outlook and guidance for the year ahead?

Doubt if you ever been a trader, you are more like one of those Nigerian princess trying hard to give away their imaginary wealth for free!
BUT what you do is incredibly hard, you research shares to trade, coming up with a trade plans, making a lot of money, spamming BBs, while your head stuck in every individual’s backside and bragging how great you are!

“I predicted BT would get left behind when the market recovered”

Toffee,
Do you really believe market has recovered or is on the path to recovery? Most of the country is not working, supply chain is in dire situation, consumer demand is collapsing and just because the market has gone up few pips, you think that you made a credible prediction. What a charlatan or deluded fool you are.

Look, indices and oil price have perked up but that has little to do with supply and demand in an economic upturn. Also such generous stimulus packages on offer complemented with unlimited corporate bond purchase plan hints somewhere there might be a hedge fund with derivatives on the wrong side of a trade and history suggests often the bet is too big to be covered. The domino starts once a failed business would be allowed to fail.

Back to BT, all I know they are not immune to the economic impact of lockdown but as far as my research goes the damage seem small and the probability of BT’s failure is quite low. In the current condition, this is enough for me to invest in BT, given that they are essential for the country.

PS: Actually cooking is one my hobbies and I do wear apron. Now crawl back under your rock.