Member Info for Velo

Typo!

So since then - the market has gone for the full month in discounting the news.

The full MONTY.
- Not "the full month"!

That Q2 RNS came out near the end of July. The SP dropped noticeably on the day (after first intradaying all the way up to 1600) .

So since then - the market has gone for the full month in discounting the news as if it was a profit warning. Would be perverse if the market punished the SP further - it would appear to be fully discounted into the current price and then some.

If history repeats itself then I don't think 1300 will be seen. Prefer just a little below 1350-ish with 1300 as absolute worse case scenario. If lower than 1300, I won't just be shocked in mouth agape fashion, but something else beyond our ken would be going on.

There have been 2 major drops of this magnitude since the last big market crash era of 2007-2009. The floors of both those swung wildly up and down, but the SP kept temporarily revisiting their lows for 3 to 4 months in each case.

I'm guesstimating that floor is just a little below 1350-ish at most, but if history repeats itself then it won't be until early new year, January, before the long term uptrend reasserts its authority IMO. In the meantime I won't be surprised should the SP veer wildly from down here-ish, up to maybe circa 1450's and too and frowing all the way to January next year.

I have my own strategy for rebuying so will try and demonstrate some self discipline, but know fine well I will be sorely tempted should the SP sink to 1350 or just below.

Long term SP expectations? Circa £20 by this time next year. But violent swings all the way non-stop.

Have sold my entire holdings this morning after yesterday's reversal to the short term trend.

I am utterly convinced of the long term uptrend, but foolishly took positions before this short term downtrend had expired. After 2 buys in the 1370's it brought my 1430's initial buy down dramatically and I was all set for further buys - to the upside.

However aware, I had broken my own entry guidelines, yesterday's reversal convinced me to restart all over, as with industry grade shorters on the books I don't fancy gambling on where the floor is (which as said previously; I foolishly did so; old habits die hard:)

It could be this high 1300's/low1400's turns out to be the floor - whatever, I much prefer to invest when the trends are short term bullish to match the long term trend too, as can't truly be sure where the ultimate floor is, just yet.

I will return (even if at a higher entry point) but far more relaxed now, than I was.

PS. Was thinking about exiting when in small profit yesterday. But after the reversal to a small loss I'm finally out 100% this morning for near £60 loss. I'm happy it's only that small. Rules are not rules if one breaks them. Just had a £60 lesson in that; pleased I can take only a v small loss rather than let things potentially get out of hand as they have done in the past.

I'm NOT bearish on GSK, on the contrary.
Just no clear signal coming through of the resumption of that uptrend yet; it'll come - and I will re-enter then.

Was using H/L platform on my phone.

The white ask/bid box should close when you click accept, but nothing happened. Assumed it was the phone not actioning my pressing the screen so tapped it again, with the same pressure as the first time, and it did what it is supposed to this time and showed the completed buy.

It was only a day or two later I noticed 2 buys had gone through within 5 seconds of each other.

Should be impossible from the one window as usually it actions in a micro second. The platform might be susceptible to mixed signals from the phone. Wasn't using HL's app as I prefer the desktop version on my phone.

" With investment in FTTP and 5G, wouldn't Net profit be down anyway"

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Yes, it will be, yet even the analysts show a massive jump in full year net profit in year 2 from this year's (year 1) projected lowly £1.4b net profit, up to £1.6bn in year 2, and increasing further in year 3.

It appears from reports in the media, that Jansen has some additional plans and ideas to keep the revenue and profit cooking nicely whilst this is all going on, but is being thwarted by the entire board led by the chairman Du Plessy. Has it coloured the analysts view with their forecasts for this year suggesting the worst results on record? (But net profit dramatically improving in years 2 and 3 - apart from revenue which they keep reducing indefinitely).

I have a hard copy of the report on the boardroom backstabbing against Jansen if you haven't seen it.

Only just noticed a silly typo. Was trying to delete a comma and replace with a decimal point but accidentally deleted a "1".

So the sentence that states:
"H1 Revenue analysts expected @ £10.642bn - down from £1,413bn last year's H1"

Should read £11bn for last year's H1 revenue as follows:

H1 Revenue analysts expected @ £10.642bn - down from £11.413bn last year's H1

" Thanks velo
So are you expecting good results
All considered "

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I'm mixed. I suspect their revenue forecast will be pretty close to accurate. But I totally reject their Q2 net profit forecast. I think a worse case scenario is net profit starting with a 3, whereas the analysts have the net profit commencing with a 2!!!

Not expecting a net profit commencing with a 4 like the old days, but it could be possible, as it was in Q1!
Should the Net Profit of Q2 start with a 4 as it did in Q1 - I would expect investors to overwhelm the analysts sentiment and drive the SP dramatically north.

But with a danger of only £200m+ odd, I'd happily settle for a net profit in the 300's.

So mixed. Revenue pretty much down as the as the analysts state, but that net profit forecast is too downbeat IMO.

Half and half - mixed. IMO.

However, I can see the logic behind the analysts forecast of only £290m net profit for Q2 when last year's Q2 actually achieved over half a billion at £563m!

And it comes from the shocking full year results produced by BT after Jansen said after poor Q3 results that everything would come good by Q4.

It didn't.

I've never posted this before as it was obvious in the year end results, but the shocking year end drop in net profit down to £1.7bn where it was £2.1bn the year prior meant that Q4 Net Profit was only £208m.

That's right, the nation's first lockdown, and Jansen being off in self isolation meant he defaulted on his promise of all coming good in Q4 (pfftt!) and instead of the expected circa half a billion+ net profit in the last q4 of the year, BT came in with just £209m in the final quarter. Shocking.

I think BT has been better prepared this Q2, but the analysts are obviously taking their cue from that £208m of the final quarter of last year's results.

They're the analysts forecast figures ie., the market's expectations.

Although I think they'll be close to the mark with revenue decline, but they've gone absolutely zombie bonkers, kill, kill, kill, with the net profit - IMO.

If BT produce the net profit as low as the analysts forecast (which I doubt) it will be a day of deep and soulful weeping.

Ought to also post some H1 Pre-tax profit figures as that's all the media are interested in, pre-tax profits.

The final analysts consensus is out this evening, the last before the H1 actuals are released the Thursday after next.

https://www.bt.com/bt-plc/assets/documents/investors/financial-reporting-and-news/latest-consensus/btgroup-consensus-16-oct-2020.pdf

And not a single penny difference in this update either - in fact never have I seen so many updates that are carbon copy print off's, of the previous forecasts - they always tinker here and there - not this year. So no detection in the movement of sentiment - it's as dire as, as per usual. Also, the (net profit) figures they forecast are so low I think they could be in for a good hiding in a fortnight.

Yes, this actual full year is on track for the worst year ever, but thereafter, the following 2 years show increase after increase in net profit at least (but the final year is still as a total, less than that achieved last year).

So you go into the H1 reveal with not a hint of upside surprise to come. But the analysts forecast is so low, I can't yet come to accept it. They only forecast quarters, yet from H1 on the morning, it's the full 6 months that will be bandied about - so to give a head start I've added the latest and final analysts forecasts of Q2 to the actual of Q1 achieved by BT to produce "expected" H1 figures by the analysts. Will repost these on the day before or the morning so you can instantly judge upon reading that day's actuals reveal.

H1 Revenue analysts expected @ £10.642bn - down from £1,413bn last year's H1

H1 Net Profit expected @ a shockingly low £738m down from H1 achieved last year of £1.068bn

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It's net profit where I think the analysts will come spectacularly undone! They have forecast £1.414bn Net profit for the full year so at least that means they're looking to increase Q3 and Q4 forecasts just to come in with that abysmally low forecast.

Q2 Net Profit last year achieved by BT was £563m,
- Q2 forecast by the analysts is (I can hardly type it) for a desultory £290m !

Unbelievable! £290m!!!
(Being brought up on expecting circa half a billion EACH quarter, it's hard to stomach that worst ever forecast of £290m for Q2).

If you recall, BT produced £448m Net Profit for Q1 - yet the analysts were forecasting in the $300m's!!!
Not a dicky bird was said in the media that BT smashed the market's expectations - all they focussed on was the 11% drop against last year's £505m Q1 Net Profit.

Up until BT, I always held the view that the name of the game was, that if you surprise the market's forecasts to the upside - you get rewarded, but not at Q1 earlier this year.

Q2 of £290m net profit is what they're forecasting on the 29th this month. Unbelievable! I think BT will smash it, and thus come in higher than that paltry H1 £738m Net Profit, just as they did in Q1.

But I suppose it can still be argued that even so, if it's less than last year (£1bm+) then it'll be boo to you BT, in the media.

Was bemused after an initial buy on Wednesday at 1431 and a 2nd buy yesterday at 1378.5 to see my holding close tonight in blue. Turns out the little window functioned twice, duplicating the order, with a third buy at .05 higher at 1378.55
- unbeknownst to me!

So that's why my average SP is less than I was expecting.

I swear blind it was no fat finger syndrome on my part.
Especially, as on my first attempt it attempted to buy me £300,000 worth of stock!

DogsInBrazil @ " You need a time capsule to buy at that price "

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Hee. LOL! A review from the wonderful comfort of hindsight? Who me? NOoooooo, not at all :) :)

- I do hope that's just a jibe meant in jest, and not a defeatist demonstration of it all being too difficult to make a decent profit from GSK's shares?

It bears repeating, just in case it is the latter:

" The point of this post is - that since 2003, there have been at least 10, yes 10 major peaks, and 10 major troughs. The last major peak was right at the start of 2020 and what is being experienced right now are the dog-days of the latest major trough. "

- So far, far, from 2003 being the one and only best starting point of making a decent profit in this stock, I maintain there have been 10 great opportunities to get in relatively cheaply, as on each and every occasion, the SP has gone on to reward, and when at that next inevitable peak (which should have been a signal to part-sell and lock in profits) and use that resultant cash to buy back in at the very next trough and thus exponentially grow profits at a phenomenal rate.

So no time capsule needed. Trend following is your substitute time capsule :)

- And the best news of all? The 10th trough is right now, so who needs to lament the lack of a time capsule?
It's a matter of conjecture when it finally floors though, and/or how high the next peak eventually gets too, after the floor is in; that's the question.

Whatever - opportunity beckons!

Someone posted below of this stock being:
" . . . Still this is a low grade board with so many saying they are happy with this DIRE sp performance, which is all that matters.right?. ."

- Well ignoring the taunts towards "so many" the sentiment is both wrong and correct at the same time, and reminds me of why I quit investing in GSK back in the day.
The answer is the same for me, and as held by that short term view expressed in that copy'n'paste post above.

Back in the day, I would have been of the same opinion. AND all because I omitted to look at the entire SP history of GSK over a 20+ years time span.

Because, if I had paid better attention back then, it would be seen that for those decades GSK has been on a long term upbeat bullish uptrend!
There were and still are, regular and notable retraces/pullbacks that trap the short term investor.

Had you'd bought 17 years ago, a year or two just after the dot com crash, and just sat tight, today you'd be sitting on circa 4 times your original investment if valued at the all time high back in the early part of this year (4.30p-ish SP in 2003 - almost £18 back in early January).

Had you bought after the 2007/2009 crash era then again you'd be sitting on a gain of over 3 & half times your initial investment.

Nearer to home and had you bought in 2015 (as I did) then today you'd be sitting on a near 80% gain! (I didn't because I fell for that copy paste type of thinking above and looked only at the most recent performance, and sold for a modest profit only).

The point of this post is - that since 2003, there have been at least 10, yes 10 major peaks, and 10 major troughs. The last major peak was right at the start of 2020 and what is being experienced right now are the dog-days of the latest major trough. Just about the worst possible time to sell!

I'm expecting a floor circa 1350/1360's but wouldn't be surprised if the SP overshot to £13 or v low 13's.

What I am not expecting is as posted by another poster of £10-£12. If it did, then this very post is a major miscalculation and my strategy is in tatters, as my initial buy was a too early 1431p. So today's top-up was the last of my "excitable buys" and I firmly expect to make further buys at much higher SP's than my two buys.

In other words, I will continue buying only when I receive clear and present evidence the trend has turned to the upside.
Be warned though, these peaks and troughs have in the past ran over 2 or 3 years time span to complete - hence I empathise with those posting of "This dire performance". It's a view that signifies one is looking at the short term picture only.

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V impressed with GSK's ROE (return on Equity) one of the finest set of metrics over half a dozen years I've seen recently (superior to AZN's for a very specific reason :!)
- so will try fitting in a post on it.

- I'm interested in the spectacular ROE for GSK for reasons you can't yet guess at, hence my delig

Knowing I was being impulsive, I've only bought in part-tranches (2 so far) so a couple more tranches to go before I reach my preferred holding level. So no real worry. Can sit and watch the SP retrace further quite comfortably. Don't regard it as a falling knife otherwise wouldn't have bought. A fair idea/opinion of the potential topside, once the floor is hit.

Noticed some negative talk about Emma. There'l! be no potty-mouthed barbs from me. No sir!

Instead I'd rather move the talk of Emma to a more refined and altogether more tasteful plane, and that is: What is this board's opinion of Emma?

- Is she hot or not ? (Cue Sid James type chuckle)

I think she is, other times I see other photos and tell myself the opposite with a:

'Oh cool your jets dude'!

So, is she hot or not?

At the same time I'm cursing myself for breaking a cardinal rule - only ever buy in the direction of the trend.
Bought yesterday too at 1431.

Need to tighten my self discipline but I've been in (and eventually out) GSK years ago.

THe ultimate long term predominant trend of 20 and 30 years are magnificent so maybe a lifeline to ameliorate my impulsiveness just now.

Got it! 1378.50!

Expecting it to floor around 1350/60's but couldn't resist as nothing is certain. 1300 wouldn't surprise me.
High 1200's would have me concerned as all long term meaningful supports have all been breached. Ultimate floor can't be far away now..... Can it!? :) :)

And just look at that margin spread up above (although when it was showing 62p to buy earlier) I did a dummy buy and was offered 60.odd to buy).

Tried a little later whilst the same buy-and-ask was showing but was actually offerred marginally higher prices.

I've been 100% lucky to date as have always been offered a decent price compared to what's shown publicly up above.

However the point of this post is that since I looked a bit deeper into MM's margin spread, it's not all about 'greedy' MM's manipulating the offers to line their pockets during times of volatility as some educational sites stated, but since then the tracking algo's have been sending me links to further info on MM's margin mark-up's and I now hold a differing view on margin spreads.

It would appear that when the margins increase dramatically (4%++ the other week) the MM's are often having a hard time of coping during times of price volatility and increase the margin to save themselves from being out of pocket due to lack of liquidity, rather than is perceived by PI's of, out and out profiteering.

Often when the day quietens down the margins can drop right back down to 1% and under, whilst the mid-price is pretty much what one was expecting all along during the high margin offers.

So, when I see high margins like that (currently 3.2%) showing up above, I no longer tsk, tsk, but muse to myself that uh-oh the MM's are struggling to cope.

Always a sign of price volatility in play, when the MM's raise their margins dramatically to help maintain liquidity.

Have a limit-buy order in place for 57 - for no other reason than that was my original average buying price early this year (before further top-up's reduced it to 49p). I have zero belief it will show up - it's there because that oddball 52 was there out of the blue, on results day, even though there was no chance of buying around it, on that day.

Slight possibility the SP could show 59 as a mid price - (but as an ask???)
Whatever, won't be surprised if 59 turns up tomorrow (temporarily) and neither will I be surprised if it doesn't.

But should it retrace in the coming days to the high 50's, rather than just idly watch it, I have a cunning plan for the SP, as Baldrick might not say.

And if October doesn't throw up a cheap buying opportunity there's always the 29th onwards in XD period, as the runner's-up prize.

Whatever, I intend being loaded-up by Dec 31st, come hell or high water. And if that cunning plan fails too, I'm happy enough with my current holding, as is.

Am I the only one planning on topping-up during this autumn into early winter?

If Baldrick's plan comes off, then I have further SP gymnastics planned for the Jan/Feb period.