The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
As I said - something off, probably lack of shareholder returns, taking the debt down is one thing but a dividend is also with considering
Given there was a bid over 100p in last few years, there is a recent transaction on the Carlsberg JV that hints at valuation for the brewery and disposals have been at circa 40% above book value.. can't really understand what on earth is going on with the share price here. Vast majority of debt is securitized at moderate rates...just not sure what the market is expecting here that I can't see. Conservative value should be circa 60p imo
Wetherspoons further supporting that view today up 9%..this is due a re rate soon
Seems shocking sentiment at the moment, surely getting looked at for a takeover at this price?
Agreeing to a 16%+ payrise with no increase in prices was commercial suicide...the reason it's going down is margin pressure + huge debt, the dividend now looks premature..so I really think they might need to sell American buses
The other thing that I think is lost here is that when the ring fenced cash and deposits are converted to earnings, at year end, the cash is going to be up at about £70 or £80m imo, which gives the true enterprise value of about £90- 100m ex cash for EBITDA of circa £35m..it's too cheap
You can see what sales are going to be by how much cash they put onto deposit at interim, huge increase Vs last year..only unknown is the margin..they are staking a lot on going short merely on the hypothesis there is margin pressure...the front load of marketing was entirely logical and balance sheet is solid...in my view now demand seems to be affirmed across sector they will close within 2 months
WotldQuant heavily shorting at rock bottom SP into rising demand - very odd short that. Took some today but feel there is more to come from our shorter friends yet
Buys £86k, not a bad figure
My honest views this remains low due to the working capital and lack of profits..nothing coming through has changed this issue, hence remains low
It's good news to win more work but how are they going to fund all the working capital requirements?
I listened to the presentation webcast this evening, congratulatory back slaps all around which all seemed very cosy I must say. They clearly need to target and win a big contract to have any hope of turning this around properly but I don't see the vision there. The CEO failed to even answer a basic question if what the addressable market size was for GRS...should have known this instantly, unstead got a load of waffle.
The assets are worth way more than mcap in the right hands imo so as you say needs a buy out I think, which may well come given they have basically bought themselves 2 years more time in my view from what I calculate.
I think the main positive I saw was the fy24 currency contracts are in place so limited downside..it's finely balanced but a tempter
Surprisingly little 'pain' in the accounts...if so easy why the delay? Currency market improving but they halved FY 24 operating profit guidance from £40m to £20m.
Going Concern issues evaporated? Expect shares will have a massive relief rally but I literally don't trust these guys
Https://oilprice.com/Energy/Crude-Oil/Middle-East-Oil-Prices-Soar-Amid-Chinese-Trading-Frenzy.html
Sooner or later tightness of physical will take over from paper shorts and oil will go strongly through 90 IMO..who is switching the air con off this summer is Asias...no one..recession or not.
Jefff I think pemex is bankrupt, they don't have money to develop fields themselves..plus the UK is about to become a case study for how to crash oil revenue through over taxing
On the latest Talos investor presentation it says us peers trade off 4x EBITDA, and Talos is well below this. Harbour listing in US could double the value here IMO. Also want to know how much Viking CCS is actually worth, as Talos have 1.7b tonnes of capacity...interesting times.
Still below placing price and 6% down on the month, frankly this should now rip through towards about £6 now, even lower free float than before after frasers buys
2.2% of company changing hands in 2 trades with no price movement..interesting. Also wondering why Pictet are increasing short so much all of a sudden.. many things going on here
The supplier insurance story was scare mongering, as with a lot of recent press it's favoured the shorts, but fundementals here indicate they are wrong and about to be burnt