Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
@ Boonie: I am wondering if Venkat might be gone by the end of the month. Where else can he turn? It seems the clamour is to scale back the investment bank and increase return to shareholders. That is what Bramson wanted 6 years ago when the SP was £2! Only last year, Venkat said Bramson was 'so, so wrong'. I can't see how he can scale up the investment bank, but will be losing face if he scales it back. What can there be in this strategy with which we all await with bated breath?The Kensington acquisition appeared odd. The Tesco acquisition seems desperate. Looking to cut costs is always a given. It could be to significantly increase dividends and buy-backs, but that would hardly deserve the fanfare being given to the strategy announcement and certainly didn't merit the work of Boston Consulting for a minimum of £10m - many posters on here, myself included, have been giving Venkat that advice for free for many years! Meanwhile the SP keeps drifting and falling, drifting and falling....
@duder 71: The only word of caution on the 'may have a chance' comment is that Barcs have believed in continuity since the 2008 crash and every CEO since has been as bad as the last. The Barcs board are head in the sand ostriches when it comes to recognising the problems of their own making. Untrustworthy, unethical. appalling treatment of shareholders, rigid and spluttering business model, litany of legal and conduct issues, c*ck-up after c*ck-up and so on. Venkat and Higgins are walking a tightrope. The SP is below that where it was when Higgins gave his patronising address to shareholders at last years AGM. A minimum of £10m paid to Boston Consulting for the strategic review to boost the SP - to be announced to huge fanfare on 20th. I have a hunch that there were two strategies in mind and that last months announcement of job cuts was a balloon going up to test market reaction. The markets didn't react, leaving me to believe that the strategic announcement on 20th is now going to have be more radical than the Barcs board wanted it to be, to try and save face (and Venkat's & Higgins' jobs!) - perhaps meaningful increase in the dividend? If I were to predict how things will pan out, I think there will be some improvement to the SP between now and 20th, but if the strategic review is patently a damp squib, it will absolutely tank on the 20th.
@Toffappleton: Now I did genuinely laugh out loud at your post. Not at its deliberately provocative patronising content, which anyone can spot from a mile away was a deliberate attempt to goad. No, it's the way you hold yourself up as a sophisticated investor, in comparison to my being a 'novice' investor. You are sitting on a big loss on Phoenix holdings. And here is your own account of how you invested in this stock:
"Usually for me I was sucked into this dog after reading a glowing account from a newspaper tipster (how lethal is that)"
Now if that is your usual way of selecting investments, then I really would pack it in if i were you before your house gets repossessed.
I'll leave you with your credibility smashed to smithereens. But like TheMoneyShark, i'll let you have the last word. You won't resist. But I won't indulge you any further either.
@TheMoneyShark: I read a while ago your unnecessary and unreasonable attacks of LHWL, a respected poster on this board. I thought, who is this? Then I looked at some of your posts and realised what a thoroughly nasty bullying individual of extremely low intellect you are. I example one of your threads:
"This just sums up how mentally handicapped you are. You think people by watches for any kind of functional purpose? Haha. Definitely a crayon munching dropped on your head as a child freak lol. It’s a luxury item worn as a fashion accessory you f*cktard. Not that you’d ever be able to buy one as you probably look for food in bins you absolute dipper. Haha."
But not just someone of very low intellect. Someone with a very deep insecurity, who finishes every other sentence with 'lol' or 'Ha Ha' in the maniacal manner of Joachin Phoenix' portrayal of The Joker. As if to say, sorry if I went too far with my offence - I was only joking really. Very insecure indeed.
Go on I will let you have the last word, you are dying to. But I won't indulge you any further.
A world beater that has lost 20% of its share value in the last two years compared to say HSBC which has increased its share value by 53% or Standard Chartered that has increased its share value by 54%? I am not denying that the FTSE is not the best place to trade. I have said so before on this board. But to argue that the Barcs SP is where it is because of the FTSE and UK markets not understanding how to value equities, is ridiculous. Even within the UK banking sector, Barclays has consistently performed appallingly against its peers since the crash. And whilst it is an undoubted fact that the Barcs SP has crashed through the floor in the last 10 years, there are some FTSE companies whose SP has done fantastically well in the same time frame. The Barcs SP is where it is because of its business model and the way it has been run. Imagine if Venkat went before the shareholders at the next AGM and when asked to explain why the SP was doing so badly he replied its because of slimy politicians and an obtuse UK market that doesn't know how to value equities. He would get an absolute mauling and rightly so.
@ ToffAppleton -- And if you are not talking a pile of waffle, why haven't they?
It is incredible to think that since 2008 when Barcs acquired the investment business (IB) of Lehman brothers, it has for 15 years, persistently maintained the stance that the IB business will drive Barcs forwards. Of course the reality is, that it has driven the barcs SP into the ground. Barcs is the kid on the touchline hoping for a few minutes action in the 'US Investment Banking Premier league game'. It never gets any, but does manage to pick up the mud from the boots of the US big boys, every time the US IB goes through a sticky patch. It has, in the last year fallen from third to fifteenth in the leaderboard of M&A brokers. It is even more incredible to think it is over 5 years, when the barcs SP was around £2.17, that Edward Bramson took a 6% stake in Barclays. He allegedly and reportedly sought to oust Jes Staley, whom he perceived to be of dubious character, he wanted to scale back the IB of barcs and seek better returns to shareholders. Ultimately, he was defeated with Venkat maintaining Bramson was "so, so, wrong". Yet he wasn't wrong about Staley. And he wasn't wrong about the terrible sp. And he wasn't wrong about the poor returns to shareholders. And as for the IB? Well 15 years on from the acquisition of Lehman, the barcs SP has pretty much fallen through every trap door going. In a constant downward trajectory, it is currently hovering around the £1.50 mark. That is an incredible further drop of 31% since Bramson bought in - and he bought in because of the dreadful SP at that time! Venkat and the Barcs board are the classic ostriches with head in the sand. They have made their bed and will lie in it, regardless. The reality that is staring them in the face is that the bank is in no-man's land and withering on the vine. Hopefully, it will be picked off by a bigger US competitor, and that will surely happen if the bank does nothing, because in doing nothing, the inevitable conclusion will be that it falls further and further behind and the SP will keep dropping and dropping. Doing 'something' means moving one way or the other on its IB. Either sell it or make an audacious attempt to join the big boys by buying a bigger competitor (that didn't work out too well for 'Fred the Shred'). In the meantime, pack it in with the pointless buy-backs and as Bramson tried to do, give some proper cash returns to shareholders. I conclude that the barcs board are clueless. It is Venkat and his predecessors who are "so, so wrong" and that Bramson was dead right.
Berenberg bank analysts also cut price target amid pessimism for investment banking. Analysts shown up in their finest colours. A JPM broker report of a little over a week ago took the SP from £1.53 to £1.61 in a day. Berenberg's has taken it back down from £ 1.57 to £ 1.51 (so far) today.
@ jezmaster - I wonder if it is the transatlantic gold dust rubbing off. I think l JPM are due to report tomorrow and an article I read yesterday suggested expectations weren't too good.
Taking a caning this morning!
@Littledog - I'll take the bait Littledog. I am sure when the buybacks started a few years ago, Barcs said it was worth 15p a share to investors. Four rounds of buybacks later, based on that Barcs statement and my holding, I should have about £25k kicking around somewhere. Unfortunately, I haven't located a penny of it! I do know however that immediately before the buybacks started the SP was £1.80+ and it is now £1.50+. I have repeatedly posted on this board the question as to what other investors feel they have got out of the buybacks. Whilst it seems in general most investors are in favour of them, no-one seems to have been able to pinpoint any benefit they have actually received from them. If the objective is simply to reduce the number of shares in circulation then yes, it is working. Indeed it cannot fail! If the objective is to save the bank money in reduced dividend payout, that will also work. If the belief is that in taking shares out of circulation, it increases demand for the remainder and pushes up the SP, well so far, it has been an abject failure.
Yesterday afternoon showed just how impossible it is to predict the markets these days. A US jobs report that estimated 170k jobs had been added in August, showed it was actually 336k. The conclusion, the US economy is booming - so terrible news for the markets, because Powell wants to cool the economy, drive it into recession by raising interest rates, so as to cool inflation. The US and UK stock markets plummeted. The FTSE dropped 60 points in a little over half an hour. Then at 3.20pm GMT, the markets jack-knifed, just like that. It was decided this jobs report was actually good news and markets soared again. Impossible to make sense of! With the next US CPI data expected on Thursday, it seems the only certainty in the near future is volatility. I think it highly unlikely to do so, but if Barcs gets back into the 1.60's before then, I think I will be tempted to make a hedge and sell a tranche of my holding, because up or down (probably both!), I think there is likely to be significant market reaction to Thursday's US CPI print.
Hi Mr W. I don’t consider myself a trader at all. As I have commented before, I made a big mistake investing ‘big’ in Barcs many years ago at around £2.70. My fault. My mistake. My responsibility. Though I can assure you at the time of my investment, there were many TA’s and ‘experts’ indicating it was a good buy. Since then I have worked hard, but cautiously, bringing that average down to £2.20. Given that the SP has halved in the subsequent years, in a continued downward trajectory, that has taken some doing. However, a lot of the years were spent ‘forgetting’ about a bad investment and doing nothing. My strategy, if it can be called that, is simple and predicated entirely as to what is happening with Barcs, UK banks, FTSE, DOW and global economics at any given time. So, for example, as I publicised on this board at the time, there was what I believed to be a surprise move up to above £1.60 recently, immediately before the last UK inflation print / BOE minutes. It seemed a ‘gift’ to me. I sold 10% of my holding and when the SP fell back to £1.54, bought them back and banked the profit. My next strategy is/was to sell 15% of my holding if the SP ‘steepled’ to above £1.65. That nearly happened almost immediately when the SP (irrationally imo) rose 8p in a day based upon a JPM broker update (again I commented at the time, with some disdain at these experts). Hindsight shows I missed out on an opportunity there, but we all do and at least I didn’t follow the JPM crew and buy in at £1.61! In Feb / Mar the TA’s were out in force on this board. Those who had bought in ‘big’ in the £1.90’s, the ‘curtain twitchers’, those believing the 200-day MA wouldn’t be breached, all ‘inviting’ punters to top up in the £1.70’s and £1.60’s, but who then went very quiet when the SP fell into the £1.20’s. I ignored the chatter. I bought a tranche at £1.38 (not the bottom) and sold at £1.58 (not the top) and banked the profit. Right here, right now, it is difficult. I fear significant further fall, but don’t have the cash or inclination to buy if it does. Equally, in case I get it wrong, I don’t feel brave enough to sell at £1.52. So for now, I sit tight. What I know for certain, is that I will never follow the advice of a TA or an ‘expert’ again. I will follow my own judgement. It failed me, when I was a naive investor all those years ago. It has not failed me once since. Naturally as we have all experienced, hindsight will tell us when we have missed out, but I can live with that. Kind regards.
Sorry Mr W. no offence intended, but this has nothing to do with Barcs failing to eat into the £1.60's at an earlier time and I am not buying into any TA analysis. The DOW has lost 8% in 2 months, the FTSE nearly 4% since Friday. Inflation & rising interest rates (higher for longer fuelling bond yield markets) pretty much the sole reason for the draining in confidence in equities. To regain some confidence I believe it's going to take one of two things. We either get better news globally on inflation / interest rates or the US markets decide this 'correction' has gone far enough.
@LWHL - Hi LWHL. Just to clarify, I was referring to the FTSE over-reaction, but I think you understand. What I cannot understand about the US is that their inflation rate is only 3.6% - getting on for half the problem we have! Given the US economy is so strong, why are they hell bent on trying to wreck it, raising interest rates to 7% (which I don't think they will do)? Why not try and reduce interest rates as soon as possible whilst aiming for an interim 3% inflation rate, then take it from there. I wouldn't mind, but both Powell and Bailey took an absolute age to start addressing inflation, leaving interest rates around about zero for months , when inflation was taking off. Now its a 2% must achieve target 'at all costs'. I said it last week, but this bloodletting is gaining serious traction now and I fear carnage tomorrow.
I get the economics of it, but we are now getting hammered this afternoon because there are more job vacancies in the US than were expected. Ridiculous over-reaction!
Hope I am wrong, but there is a grim feel about global stocks at the minute. The DOW has pretty much fallen for 2 weeks solid and the FTSE is bloodletting today. Global inflation sticking, interest rates comparatively sky high and due to remain so, global economies already flatlining or in recession. It feels like what's going to break first to trigger the avalanche. Need some good news soon to stem the tide and further good news to build on.
17.5bn shares when buy-backs started. SP then £1.80+. Total of £4bn spent on buybacks. SP now £1.50+. If the £4bn were spent on cash dividends, that would be 22p per share. On my holding that would be £9k in my pocket. So no, I'm not seeing it as great news.
@ Dr Patience: In hindsight the comment you took issue with was perhaps a little unfair, though it does show how easy it would be to manipulate the market in this way. The real frustration for me however, is the fact the market 'is what it is'. At least for the last 7 years I have read hundreds of articles telling me Barcs is way too cheap and 'lift-off' is around the corner - the best one being McFarlane's 'double in 3 years the SP of £2.60'. Turns out, he meant halve it! I treat these articles and TA analysis with the utmost caution and base my judgements entirely on what is happening in the wider world. And at the moment, I don't see the storm clouds clearing. UK banks and the FTSE have been in the doldrums for years. I acknowledge a genuine bull run might come along and suddenly the FTSE, banks and Barcs might all take off. But it's going to take a lot more than a broker update from Morgan Stanley to convince me its happening now!
I believe it was this statement that sent the SP from £1.53 to £1.61 in a day. Which way is it heading now? This is simply market manipulation for personal gain. I pity those falling for it and buying in at £1.61.