Member Info for TakingMyTime

LOL, that's hilarious.

Charts mean nothing with a share like this.

'I don't think the divis are sustainable in the sector.'
Dividend cover is 1.59, that's pretty good. Divestment is bringing gearing down. I don't see any reason to think the dividend isn't going to continue, and probably gradually improve for some time to come -- and eventually the Deepwater Horizon payments drop out of the picture.

@TLWilliams, your strategy and view matches mine. If we get significant price appreciation I might sell and lock in my gains, but for now I'm happy to have the divs roll in.

@NI "the size of the dividend has been the reason to own Evraz. The problem now is that the board has indicated the need for over $1bn capex per annum for four years!"

2018 CAPEX $527M, DIV $1566M, debt decreased by $400M.
2017 CAPEX $603M, DIV $430M, debt decreased by $1032M.

The last two years have seen significant resources going to reduce debt. Debt is now below the medium-term target, so that is unlikely to continue, and the funds which have been going to reduce debt will mostly now be going to CAPEX instead. If the company continues the same profitability that it has, the dividend should remain largely supported, despite the CAPEX.

The question, as always, is if the company continues with comparable profitability. At today's share price, a 25-30% cut in profits (and dividend) would still be catching my attention. These prices are insane. Either someone knows something we don't know or it's a shorting attack.

Special div very unlikely while gearing is so high. Not sure where that idea came from. Cash will be used to reduce gearing and hopefully continue to gradually increase the dividend.

@WW 'Of course, being taken private would probably mean that the intrinsic value in Wimps will be transfer to the acquirer, and not the shareholder.'
Has to be approved by shareholders and most can see the intrinsic value, so will be at least partly reflected in the acquisition price. We'll do pretty well if that happens, without the risks of holding and something going wrong, like Corbyn/McDonnell gaining power or management doing something stupid. Would be fine with me.

I doubt it passes without the DUP. If they are against at least a few ERGs will be against, too. The Tory Remainers who've gone Lib Dem will be against. Grieve and Clarke might be as well.

If it fails, I expect an extension and an election.

TW doing well but PSN absolutely flying (up 7%). What will they do if the deal actually gets through Parliament?

Probably partly doing worse than other steel-heavy miners due to the trade wars -- sure, there's the US division but it's still mostly Russian, so vulnerable to high tariffs.

Partly also, I'd guess, the high gearing compared to some others. In an economic downswing, if that's what we're going to have, the companies with high gearing will be impacted more.

I would also guess the significant share sells by principals earlier this year has the market spooked, thinking that upside will be capped if they dump more shares next time the price goes up. No one knows if they will or not, but some will avoid this share for that reason -- not a factor with other miners.

Plenty of reasons for people to sell, but am pretty sure it is oversold and that reality will catch up sometime in the next few years. If I'm right I'm going to do really well on this share.

'EVR has collapsed by almost half in 4 months, in an overall bull market.' Four months ago the FTSE closed at 7345, today 7211. Nice 'overall bull market.'

We get it, you're short on Evraz. Good for you, it's been going well for you. I'd guess it wouldn't go much lower, but if you push it you might get lucky and see further drops. Bet you're praying Trump doesn't agree a deal with China, your whole strategy will fall apart.

But don't think you are going to influence anyone. I won't bother to tell you why.

@Thaiflyer "Luckily i had a few Sophos shares...........up 150p on takeover news...........:-)"

You just might want to sell at that price rather than wait for the takeover to complete. The buyout is in dollars, and if Brexit resolves one way or another the pound would probably rise, hitting the value for you (those dollars will then buy fewer pounds). You also have the risk that the deal falls through, that happens sometime.

Of course, if there's a no-deal Brexit the pound might drop and increase your value even more. But you definitely should consider currency fluctuations in deciding whether to wait for the takeover to complete, or just sell now.

Best of Luck!

Thanks, Tom, enjoy your weekend!

Pretty good analysis, IMO. TW and BDEV are also up over 10% today. Housebuilders have been underpriced because of Brexit fears, the hopes of a deal has made them surge. I expected it would come, didn't know when, was lucky and increased my holdings last week.

It could all collapse, and if we hear over the weekend that the talks aren't going well there will be a crazy drop on Monday. Not paying much attention to this -- I only expect it to be sustained after we either Brexit or don't. It's tempting to take some profits on what I bought last week, but we might actually have a deal and it would really go then.

@Thaiflyer Maybe you'll feel a little better today. :) Long may that 'good dividend' continue!

Yeah, probably two main factors. The update on divestment and the large after tax charge isn't particularly positive for a dividend increase which many have been expecting. And the pound strengthening vs the dollar doesn't help BP very much.

@Tom 'Yes totally agree. I was referring to some that said it will have no effect to the housing sector as houses will always be in demand / required, but how wrong was that statement !'

I said something similar to that and I still don't think it is wrong. I don't think Brexit, whatever happens, is going to have a significant impact on the profitability of house-builders. It obviously will have a short term impact on share prices because they are driven by sentiment more than by profit right now. If they were driven by profit and payouts the prices would be double what they are.

But in the long term, people will still need houses, there will still be a housing shortage, those who have land and cash will be able to ride out any short term disruptions, and they will make money and their share prices will go up. Until we leave or cancel Brexit, there will be volatility. Once either happens the sentiment will turn and eventually match the profits. What happens with Brexit may determine how quickly sentiment turns, but it won't change the underlying fundamentals. The share price today is a mirage. It will either drop if there's no deal or surge if there is a deal or Brexit is cancelled. But it has nothing to do with whether the company makes money. Speculators / day traders are having their fun right now, that's all.

You're right Nige. Everyone is still posturing, no one wants to be blamed. We'll have bad news within 2-3 days, perhaps even today, then good news a few days later, and so on.

Everyone knows where their real red lines are and no one wants to say, because they want to get better than their actual red lines. So it's going to be back and forth. News yesterday, today, and tomorrow means nothing. We'll find out at the very last minute whether there will actually be a deal, an extension, no Brexit, or no deal. If I were a day trader I also would be taking profit today.

Gavster, further to your question, you aren't the only one noticing that the price is now below most analyst's target prices. https://www.marketscreener.com/EVRAZ-PLC-13351696/ratings/
Among other comments: 'The average target price set by analysts covering the stock is above current prices and offers a tremendous appreciation potential'

Hi, Thaiflyer. My view, FWIW, is that if you are going to be frustrated at the share price, it's the wrong investment. This is one to hold for a while. If we are going into a recession, and we might, the share price is going to stay down for a while, even if the dividends keep coming in reasonably well. I only bought this because I can let it ride for up to 10 years -- at some point in that time I expect to see an economic surge and the share price to be quite high. In the meantime I expect they'll do what this kind of company does -- keep pumping out the dividends to whatever extent they reasonably can.

You have to be prepared to let it ride and not care about the share price, I think. If you are going to need to get out of it sometime in the next year or two, there's a significant risk you'll regret having gone into it.

If that's where you are, it's kind of a problem for you, isn't it? Do you bail out now, cut your losses, and get into something more stable that you'll feel more comfortable with? Or do you ride it out since you already went into it, and make up your mind to not go into this kind of share in future? I'm not sure anyone can really advise you on that.

I do think if Brexit uncertainty is resolved you'll see a bounce-back. How much of a bounce-back depends on how the uncertainty is resolved. I don't think Brexit is the main driver of what is happening with this share, but it is a factor for market sentiment generally.

@Nige 'I know you don't agree with this speculation, but I still think we will not leave EU, and that it means this is a massive opportunity.'
Our speculations on what will happen don't line up, nor do our views on what should happen, though what I wanted and what you wanted are probably pretty close. But for purposes of this forum, we're absolutely agreed on the massive opportunity.

I'd say it is a massive opportunity either way. As you have posted multiple times, even a no-deal Brexit isn't going to change the supply/demand dynamic, and that means Brexit uncertainty has driven builder SPs way below actual value. I expect prices to bump up fairly soon even in a no-deal scenario, as people look around and say, 'What were we thinking? People still need a place to live.'

No-Brexit vs deal vs no-deal only impacts how long it takes for sanity to return to the market's evaluation of these shares. It will return because they will keep making money in any scenario. It's an incredible buying opportunity, whether it takes a month, 12, or 24 for share prices to move closer to the actual value.