If you would like to ask our webinar guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund a question please submit them here.
I would be wary of drawing any conclusion from AQR's short position increasing whilst the share price is rising. What AQR's real trading position is may be totally different to being short Capita stock., i.e they may be net long through an off exchange derivative, or possibly part of a long short pair trade. As Scott1984 highlighted, this outfit is relatively smart so it is highly unlikely that a hedge fund would punt a position one way without insurance. My view is they are net long but Hedge funds are masters of misdirection.
Wouldn't that be something - Held this stock for 4 years and seen prospects wither on the vine ! I wonder whether Polo is starting to add a little pressure to get some shareholder value - i.e Weatherly ! In fact why not sell all the holdings and return capital to shareholders thereby creating wealth for investors.
Agree with that Twiddler - Company is becoming less reliant on lower margin business of the past and the acquisitions are clearly boosting margins which should start to get the attention of Growth screening. A growth stock on an ex-growth stock rating - I think this is one of the cheapest small caps in the UK market.
As confident as I have been that this was nothing more than an exercise in sort out revenue recognition - Reading some of the posts here has been torture - I am confident with management and despite some bruises from the suspension the business should pick up now the news is out. I would expect the Brokers to lower their targets to 60p on a 12 month basis but my cursory DCF suggest a possible 120p target for Y/E 2020. To back my view I need to see some RNS announcements around Director shareholdings at these levels either purchases or options. I don't expect too much this year but should find a base to springboard from.
As you say - Just a view but if the results come with disposals at market values rather than fire sale prices then the upside is there for all to see. Any management team wants to avoid a rights issue and I feel we now have good senior managers. As for Fund managers, it is Mark Barnett's comment that resonate with me in that a rights issue held back is an open door for Shorters - who have had a field day and will be wanting to protect their profits in case a PFG style announcement takes it all back off them. CPI just way too cheap IMHO
According to some the rights issue may not happen. In some quarters it is seen as a very clever piece of leverage to keep asset sale prices high as they are not distressed sellers. This is most definitely not Carillion/Interserve/Serco/Mitie etc or any other low margin high debt sausage - Loads of cash ~�275m EBITDA and they have private equity buyers willing to chop their arms off to grap a bit of the action. Expect good news by the bucket load from here on. .Iif the sales go well, no need to have a dilutive rights and if not expect �4 by the year end.
I think I am mostly with you - clearly you too have studied the Annual R&A in detail too - My numbers were a little different in that I expect Emerald will convert their debt for more shares giving a bigger dilution but the end game is the same - after all why not they hold the cards as you say - I compared it to Queen's Moat rather than Marconi but that just show's my age ! I too don't have a holding yet as I tend to buy after the restructuring in special situations like this because nobody really knows how bad it's going to get.
It can be very difficult to reach the right conclusion here. It could be either their prime brokerage buying stock for a big investor or one of their OEICs - being long, or alternatively stock lending to then go short, or even some derivative strategy which they require stock held etc etc - I tend to ignore Big brokerage RNS as it can confuse !
Not quite Lendmeadollar - The price adjusts to take account of the rights (called Ex rights)so there is nothing gained per se by the rights issue other than extra cash for the company. That said if the rights issue money changes the outlooks positively then you will see upgrades. You do however raise a far more interesting point on whether this is a stock worth buying - I look at PFG and see a company hugely undervalued and solving it's problems that pulled the share price from �33 to �6 in a matter of months - The problems still exist but they are less acute and my analysis, is very similar to that of several analysts recently in that my share price target is +30% in 1 yr and +45% over 2 years plus dividends of up to 8% in total. I cannot find another �1bn+ company with that potential on the UK market - suffice to say I'm a buyer and current holder !
I too expect huge volatility once this comes back - washing out all those traders who are happy to just get something back in the coffers. We may see finals and interim's on the same day which would be interesting and may give a clear post adjusted view as to what the earning potential really is.
Liberium Capital - Long time Bear on the stock have put out a Bullish note and TP �13.06 on the Cum rights price �8.95 ER. Usually a 12 month PT - 24 month PT's harder to come by but appear to huddle just north of �10, plus about �1 of divis over that period too.
You will be entitled to 1062 on 1500 at �3.15 each. Check out PFG website for timings.
The capital buffer is a good idea as Vanquis has been relatively untested in an economic slowdown - Ex rights we will be around �7 on today's close but looking at the potential and the fact PFG will be seen as alot less prone to FCA risk as against peers, it does deserve a premium rating of 15-18 times next years earnings in my opinion - therefore �9.20 post rights by summer '18 and possibly as high as �11.80 by the end of 2019 which makes it a great 2 year investment from here, hard to see another �1bn+ company with more potential unless anyone has a better idea !
I have been watching this stock and researching it's accounts for 12 months now waiting for a time to buy. There are two things that concern me - Debt and poor execution by the BoD. I mentioned in January that there didn't seem much value left in the equity but if the Board could get a deep discounted rights away on a rally that could change the future for Interserve shares. Now I feel they have executed poorly again At �1.20 they could have got away a �200m raising at say 60-70p and not totally cripple the exisitng shareholders. Now you've got to be looking at issuing 800m new shares at say 25p but to be frank I doubt you will get the buy in - not with �600m debt. Here's hoping for a rally above �1 and a rights issue at 60p , if not a dilutive debt for equity swap will be on the cards - This won't fold like Carillion, but it might fold like Queen's Moat - one for any of you old timers !
I would be less worried than some about this - Due to the length of time it has taken to get the figures out, there will be regulatory requirements which would need to be adhered to so - A fair call by the company to temporarily suspend. They made clear that it was not Banking covenants/trading/cash position so I conclude regulatory which is far less serious - Just went through this with another small company and came out the other side. Once this is complete the company will be in a far better place for all concerned, not least shareholders who will be able to see a clearer picture rather than smoke and mirrors - I for one welcome all this change.
Small mention in this week's edition !
I expected 15-20p finish after I initially read the RNS at 7am - not because I believe that is where it should be but because of animal spirits. The fact that it stayed relatively firm in the face of that announcement says one important thing to me - we are close to the bottom on this one. I don't believe the 'take it private' view, I don't believe Banks will fail to support this company and I don't believe you cannot turn this around - clearly I am not the only one or else we would be sub 20p. I would expect a rocky start on results day but why would there be too many more surprises they could have piled on the pain today if they really wanted this taken private - Next announcement watch for the Bucket of Director share options at 40-50p.
Nice breakout from the downtrend confirmed - should flag up to 6p soon with first major resistance at 8p. Looks easy given Hib P holding worth approx. 10p at present.
Much of the historical team are now gone - standard practice to now blame it all on the previous lot - Get an incentive plan in place at 50pps and then let rip for 2-3 years and exit at �2- A good CEO would relish a turnaround situation like this in a stockmarket of bland returns and little real growth, special sits are where good management men become great.
ROE may be relatively low for the sector but the stock is cheap, pays a divi and is growing at over 10% PA - should be 60p on a conservative estimate but is languishing still at 41p - Question is when does a big fish snap up this tasty snack - IMHO maybe this year unless management can get more Institutional interest in the stock - too cheap