Member Info for Redheadedrager

Contract renewals indicate to me that PFC is doing just fine.

The short position hedge funds have called it wrong.

Marshall Wace called it correctly and have now exited stage left.

The others are left holding a ticking time bomb, nervously eyeing each other not wanting to be last out.

Not long now 😂🤣😂🤣

Hold the line!!!!!

. . . by short position hedge funds to control the price

Volume has picked up and it’s extremely choppy out there.

They mist be getting quite nervous now, increasingly aggressive. This afternoon’s trading could be a right old dust up between shorts and longs. Like properly good to watch 🤣😂

NM

An interesting article which some may have missed.

A government and regulator prepared to take action to keep the playing field level. . .

https://asia.nikkei.com/Spotlight/Market-Spotlight/South-Korea-s-stock-short-selling-ban-raises-political-questions#:~:text=5%2C%20at%20an%20unscheduled%20Sunday,2024%20%2D%2D%20almost%20eight%20months.

@StockNor

When a stock is “in play” per PFC, I’d trust technical analysis as much as tea leaves.

You were fortunate to get out without a loss. In your instance, placing a stop loss was a sensible move. A more sensible move would have been to hedge with a long at the lower levels . . .

@StockNor

Off you toddle sonny. Next time try going long. Only way you can win with PFC at this price.

Byeee!

Bonds gain from 35.27 (historic low in 23) to 49.25 so just under 60% with a potential for a maximum further gain of 100%

Equity gain from 14.58 (historic low in 23) to 30.12 just over 100% with potential for 250% plus gain in near term (next 6 months)

I have place my investments accordingly.

@PaulCurtis

The short position hedge funds aren’t closing yet because they still don’t realise how much trouble they’re in.

They’ve called it badly wrong - either they haven’t realised yet or have realised and are praying for something to give them a palatable exit. But their time is running out fast.

There won’t be an equity wipe out via D4E. There won’t be a RI at this level. There will be some assets disposals (most likely upstream). There may well be further bond issuances with first call on say the Tennet contract incomes . . . The current bonds will drop as they lose some seniority.

@PaulCurtis

The cash position has got worse, agreed, but marginally not dramatically - per the update.

Performance guarantees are being obtained but at a higher amount of security being required by the companies granting them. Again, per the update.

Impact upon next cash outflow is negative but not materially so.

The real challenge for PFC is not operating per se, it’s in obtaining the increased amounts cash of provide collateral required to secure the performance guarantees for the swathe of huge contracts that they have just won.

So that is why the bonds are under pressure. My bet is that PFC are going to go and get more bond finance with much better returns (say 10-12%) over period where we are going to see global interest rates fall away (returning to 2-5%) so the yields will be much better than the curent debt, making them uncompetitive.

Paul, have you bought a dog?

@PaulCurtis

Marshall Wace, the only “serious” player that was shorting PFC has closed its position (at least reduced to below 0.5%)

The others are amateurs. They do get things wrong.

The RCF will be refreshed. As stated by PFC covenants remain intact. The cash position is constantly improving through better recoveries per most recent update.

The challenge has been that the security requirement for performance guarantees has been significantly increased. This has impacted cash flow. However, the first Tenet PG has been paid, others are looking positive too.

Net debt will settle slightly higher at y/e but that is due to increased PGs.

There is and has been no question over ability to service the bonds interest repayments, and no urgency around capital repayment which is not due until November 2026, so don’t go spreading rumours that that can’t / won’t be able to meet those obligations as it is not true.

Overall, I am comfortable and confident in PFCs management’s ability to negotiate this speed bump.

All will be well, your bond investment is good, but as I said before, you’ll make more on the equity 👍

. . . has bought the bonds

Obviously of the belief that a D4E swap is on the way.

That is why his arguments tends towards alternative methods of refinancing the B/S.

I’m fairly certain he hasn’t shorted PFC. But, I don’t agree with his analysis of the B/S that supports his investment in the bonds.

People often confuse profitability with cash flow. In the world of LTCs, timing is everything as they say . . . 😉

Thanks Blue - you’ve just proven my point.

The MMs do not hold a large position in the stock, waiting to give the short position hedge funds an easy exit.

ClickIT has blocked me 😭 (🤣😂🤣😂) but perhaps someone could explain why they’re worng to them 👍

OK, let’s examine the “logic” shall we.

MMs buy all of Schroders’ stock.

Then watch the SP collapse. Then loan it all out on at an ever increasing paper loss to short position hedge funds.

Who then drive the SP down even further, aiming for capitulation and D4E swap, leaving the shares owed to the MMs as worthless.

MMs take a massive bath, short position hedge funds make a boat load of cash and it’s champagne and charlie for the city types.

Why would the MMs sign up for that?

If you can offer a rational argument then I’m all ears.

@Clickbait

MMs do not hold substantial amounts of shares, even overnight.

That’s trading. They’re market makers - they’re not in the risk game, they’re in the volume / margin game.

Sheesh, some people have not a f’ckin clue . . .

@Herbieridesaga

The short position hedge funds have AT LEAST 11.4% of the stock borrowed.

Look at the list of major share holders on Petrofac’s website and you can see that the free float of shares that they can now borrow is dramatically reduced.

Simply put, they have very little wriggle room left.

There is no last stand, drawing a line in the sand, or Mexican stand off. They are running on fumes (as demonstrated by the series of 1 share sales by a ‘bot yesterday).

If either market sentiment swings slightly against them (I’d argue it is finely balanced on a knife edge atm) or majorly (with even a semi reasonable RNS update) then anyone and everyone holding a short position will be kippered.

End of.

Hmmm. . . Kepler . . . 🤔

I think that you ought to read up on what happened to Rolls Royce . . .

Interesting parallels with their story.

Don’t be surprised if we escape this without an equity raise.

D4E is a pipe dream.

Those bonds should recover well Paul, but you’re better off leveraging into the equity rather than the debt fella.

A LOT more upside.

Hmmm. . . Kepler . . . 🤔

I think that you ought to read up on what happened to Rolls Royce . . .

Interesting parallels with their story.

Don’t be surprised if we escape this without an equity raise.

D4E is a pipe dream.

Those binds should recover well Paul, but you’re better off leveraging into the equity rather than the debt fella.

A LOT more upside.

. . . is a clown 🤡

Recommend if you agree 👍

Wrong again PaperTiger

For me it’s ego AND greed.

Warren Buffet “Be greedy when others are fearful, be fearful when others are greedy.”

So, given that the short position hedge fund mangers appear to be getting very greedy, are you fearful yet?