Member Info for Onbeyondzebra

Simply Wallstreet... there's your answer. It's just clickbait crap with data from 2015.

Strange advice Pubcrawl seeing as if they had followed their advice they would have protected their capital and if they’d followed your advice over the last couple of weeks and months they’d be down 50%.

2K down is not nearly as bad as some others on here. I’m sure you heard it before, but if you’re new to investing you should avoid highly volatile penny stocks and start getting a sense for good companies that are undervalued or out of favour. I like many others have done well with HE1 because I have no loyalty to the company, will sell it all when I’m in good profit, and won’t go near it with a barge poll when a raise/mass dilution is due. My guess is it’s likely to get much worse before it gets better, but who really knows, it could jump 20% next week. For your other investments, banks are at recent highs but are still underpriced in comparison to oversees competitors. I personally sold out of all of them when I was 50% up. For good companies with a bright future, think Wise and IAG which are (slowly) rerating, and have a long way to go. But that’s investing rather than speculating and you have to decide which one you’re here to do.

Well, they’ve certainly played a blinder. At least with the last crazy dilution, where they gave away (what was it?) 85+% of the company to their mates you at least knew where the bottom was. From how I read this RNS, the current state of chaos could go on for a year effectively until the 10million they raised makes up the entire market cap and all earlier shares are worthless. The good news is there is a ‘soft floor’ of .17p, as the market cap shouldn’t drop below the 10million cash in hand. If you’re curious, an AI deep research concludes that if the decline stalls at .35 that’s an optimal entry point, but if it keeps going towards .20, steer clear as it looks like it’s a full wipeout. This is because the company wouldn’t be able to pay back the institutional investors for shares not converted and would have to effectively give the company away for peanuts (which they seem to have already done… again). For the cold hearted, there will be some serious money to be made here eventually, though sadly it will be on the backs of other PIs’ pension pots etc. I for one will keep tracking the decline and hope for the sake of LTHs that some miracle RNS saves the day like it did last time.

I particularly loved “Yes, there are always risks in frontier helium…” as though it’s been going on for hundreds of years and there was more than three companies doing it.

Whether the newbies realised or not, it was always extremely risky to buy in during this (extended) period where an equity raise was around the corner. As I’ve said multiple times, no company on AIM has such an impressive history of wiping out all of it’s PIs’ holdings with its raises (depressing the sp to almost nothing and then raising). I like the project, and do think it will recover, but the recovery is always relative to the starting point and it’s much better to be in at the price of Lorna’s institutional mates, then any price after that.

Worth always remembering the game is rigged. I calculated last week that I bought my last SUV on the money I've made on HE1 making sure I buy in at the price of the institional investors and selling when there's a stonking profit. I'm still not quite sure why the BOD feel compelled to warn everyone in advance that there 'will be a raise' rather than just doing it like every other company in the world. I guess it's all about depressing the SP and establishing mates rates for the instituional investors and repeatedly wiping out the retail investors. As they've now done it four times, I imagine no investor that actually wants to make money would consider this as anything other than a quick turnaround recovery penny stock.

Bigbeasty: Strange equity to buy if you’re new to investing and learning the ropes. There’s a lot of value in the market, and you’ve chosen one that’s wiped out its investors multiple times and in the last 3 years. I’ve made a lot of money on He1 and will continue to dip in and out (I like the project and find the board to be predictably unpredictable). As they couldn’t care less about small investors - and maybe they shouldn’t - I tend to like buying in precisely when they complete a major raise I don’t feel there’s a ticking time bomb ready to go off. For your future development, it will also be good to figure out which shares are buy, hold and come back in 5 years, and which ones you can’t do that with (e.g. He1) because they’ll need to give away the majority of the company (i.e. your slice of the pie) to fund their grande ambitions, But, hey, I guess these are things that every investor will have to learn through trial and error. I always say you can either pay a bunch of money for a course on investing, or you can just lose most of your first 10-20k and learn what not to do.

If anyone would like to copy more of the report, let me know. There were some other bits that I thought were interesting.

End of copy and paste. But the point is I’d trust this analysis over what’s being bandied about here, and it doesn’t look anywhere near as bleak.

Mobico Group)

Metric Value (.Post-sale) Notes/Sources

Share Price (25 Apr 2025) 34.8 p Plunged ~40% on sale news​.

Market Capitalization ~£214 million At 34.8p/share (≈616m shares)​

Enterprise Value (EV) ~£1.3 billion Equity £214m + net debt ~£1.1bn (est. pre-sale)

EV/EBITDA (Trailing) ~4.7× Using ~£348m EBITDA (TTM)​, EV ~£1.64bn.

Price / Book ~0.4× Very low P/B (shares trade at 40% of book)​

Net Debt (Dec 2023) £908–988m ~£908.5m at FY 2023; rose to £987.9m by H1 2024​

Net Debt/EBITDA (Leverage) ~2.8× Covenant gearing at H1 2024​

Net Debt Reduction (expected) £275–290m. Sale net proceeds to cut debt​

Net Debt/EBITDA (Target) 1.5–2.0× Long-term leverage goal​

Earnings and Book Value: Mobico will lose the modest profit contribution of the School Bus arm (~£9m of adjusted operating profit in FY2024)​. But given group guidance for 2024 OP was £185–205m​, this sale is not very dilutive to earnings (only ~5% of OP). One-off impacts: the company warned it will post a “significant” net loss for 2024 due to impairments (goodwill write-downs, deferred tax asset write-offs, onerous contract provisions in German rail). These non-cash charges will reduce book equity, but they “clear the decks” of legacy issues. At 34.8p, the stock trades at roughly 0.4× book value​, indicating pessimism is priced in. Post-write-down, book value will shrink, but the debt payoff from the sale adds to equity value (by lowering liabilities). Overall, the sale slightly reduces Mobico’s scale (removing ~15% of group EBITDA​) but materially improves its financial position. A leaner Mobico will emerge with a simpler portfolio, lower net debt, and management free to focus on core businesses. Below is a summary of current valuation metrics:

Cash Flow Impact: Importantly, divesting the School Bus unit should improve Mobico’s free cash flow profile. The School Bus business, while operating in a stable market, was highly capital-intensive – it required over £200 million of capital investment across 2022–2024 while yielding minimal positive free cash flow for the group​

. By selling this division, Mobico can reallocate capital and avoid heavy ongoing fleet capex in North America. Management explicitly noted the deal will allow the Group to “reallocate cash flows from the capital-intensive School Bus business” and focus on more cash-generative areas​. In other words, the sale should boost Mobico’s balance sheet strength (via debt reduction) and its future cash generation (by shedding a drag on free cash).

Debt Reduction and Balance Sheet: The net cash proceeds (≈£275m) are to be retained for debt reduction​

. This should meaningfully cut Mobico’s net debt, which stood at over £1.0 billion prior to the deal​

. For context, covenant net debt was £988m as of mid-2024 (net debt/EBITDA leverage ~2.8×)​

. Table 1 shows key valuation metrics before and after the sale. In rough terms, if net debt falls into the £700–750m range post-sale (after applying ~£275m proceeds and removing ~£30m of leases), Mobico’s pro forma leverage should improve. Management noted the transaction is “broadly neutral to covenant leverage initially”​

– meaning the immediate impact on the debt/EBITDA ratio is minimal because the sale also removes the School Bus EBITDA. However, with lower debt and interest expense going forward, and freed-up capital, future deleveraging should accelerate through growth in the remaining businesses​

. Mobico is targeting a long-term covenant leverage of 1.5–2.0× net debt/EBITDA​, versus ~2.8× currently.

Updated Valuation Post-Sale Announcement

Sale Details: Mobico has agreed to sell its North America School Bus business for an enterprise value (EV) of up to $608 million (including an earn-out of up to $70m)​. This equates to a lofty multiple of ~50× the division’s expected 2024 operating profit (only $11.5m) but a more modest ~5.0× its 2024 EBITDA ($122m)​. The high EBITDA multiple reflects the division’s heavy depreciation and capital needs. Mobico will receive approximately $365–385 million (≈£275–290m) in upfront net proceeds at closing, after deductions for lease liabilities, deferred capex, fees, and other “debt-like” items​

. Additionally, about $38m of IFRS-16 lease liabilities from School Bus will come off Mobico’s balance sheet​. The sale is expected to complete by Q3 2025, subject to approvals​.

It’s posts like this that made me suggest to create a deep research report:

Tried to paste in a Deep Research Report. Clearly didn’t work but quite insightful if anyone want to try: This was the prompt -Analyze Mobico Group as a potential recovery play, focusing on the implications of the announced sale of its North America School Bus business. Look at current and projected valuations, debt reduction potential, turnaround indicators, and recent analyst sentiment or price targets. Also consider whether there is potential for a short-term rebound versus longer-term fundamental upside.

Long-Term (1–3 years): The long-term value creation potential for Mobico is more clearly present, albeit with risks. If we look out 1–3 years, Mobico could plausibly transform into a healthier company: the School Bus sale will have reduced net debt by around 25%, and ongoing cash generation from ALSA and other units can further chip away at debt. By 2026, Mobico might reach its target leverage range (~1.5–2×), at which point it would have a much stronger balance sheet (net debt perhaps

risk-reward assessment: considering the above, at ~35p the risk-reward profile appears skewed towards reward for patient investors, but not without substantial volatility. the current pricing reflects pessimism and arguably undershoots mobico’s intrinsic value (even a liquidation value of its assets could be higher than 35p on the pound given fleets, contracts, and the profitable alsa division). the downside from here may be limited unless the company’s situation deteriorates further unexpectedly. in contrast, the upside potential if mobico succeeds in its recovery is considerable – potentially multiples of the current share price over a multi-year horizon (analysts’ targets in the 60–100p range illustrate this gap​

marketbeat.com

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investing.com

). in conclusion, mobico can be viewed as a speculative recovery play. the recent asset sale and ongoing restructuring efforts support the viability of the business by strengthening the balance sheet and enabling a focus on core operations. there are clear catalysts (debt reduction, operational improvements, returning confidence) that could drive a turnaround in the share price. however, the recovery will likely be gradual and not without challenges. for investors at current prices (~35–40p), the stock offers an attractive but high-risk proposition – the entry point is low relative to historical valuations and sum-of-parts value, but mobico must now prove that it can deliver sustained earnings growth and debt reduction. those with a long-term horizon may find the risk-reward favorable, while acknowledging that in the short term the stock could remain pressured until the benefits of the sale and the turnaround translate into tangible financial results. as always with recovery stories, execution is key: if mobico’s management delivers on plans and the macro environment cooperates, today’s price could indeed mark a value opportunity; if not, the shares could languish. given the information at hand, mobico does appear to have the ingredients for a successful turnaround, making it a watchlist candidate for recovery investors – with the caveat that patience and a tolerance for volatility will be required. sources: company announcement and presentation of the north america school bus sale​

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; mobico 2024 guidance and trading updates​

mobicogroup.com

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reuters.com

; analyst and news commentary from reuters, cityam, and alliance news on the sale and outlook​

reuters.com

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cityam.com

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morningstar.co.uk

; consensus analyst targets and ratings compiled from investing.com and marketbeat​

investing.com

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marketbeat.com

; mobico half-year 2024 results for financial metrics​

mobicogroup.com

. all data is as of late april 2025.

I'be been out for a few months but am back in at these prices. It may drop a bit more over the coming days, but with a market cap of £200m, realistically how much lower can it go? As with Metro bank in the summer, I see this as an easy bagger from here.