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Intimate - The site in Florida was bought way back in June 2013 so in no way related to the recent acquisition of Peacock Foods. Must be a different chunk of frozen business that is going away (This site is nothing to do with the meat company you mentioned). Shorters will have made a killing from this slide, shocking thing is how did they know to bet against a company that on face of things was going from strength to strength ... someone must have had a tip off in order to drive FTSE250 share price backwards without any negative news in the public domain ??
Seems the market wants everyone (Not just UK & Irish employees) to be able to grab a few of these on the cheap this year !!?? Assuming a PER of just x20 today's closing price represents equivalent of a meager 10p EPS (We can't be tracking that badly - No way) .. so begs the question: Has market overdone this retrace or is there really something to be concerned about in the background ? Sooner or later the reasons will become public and the recovery can begin.
I have given my opinion regarding where I believe SP should be, however this retrace has been quite deliberate and prolonged which as much as I don't want to admit would suggest that market is aware of something that is causing discomfort. Broker targets all edged back during the slide which again may be a nod toward trouble that the private investor will always be last to know ?? I hope for the sake of my investment here that my calculations are right and my gut feeling is wrong .. time will tell ! Keep the faith - Wooly
SP seems to be in reverse gear for about a month now - not sure what is going on but if it keeps this up there is a good chance that 198p will be available sooner than expected !! Retrace is a total mystery to me, I remain convinced that this is now hugely undervalued especially when looking to forward PER considering the addition of revenues & profits from the recent US acquisition ! As I have said before this is worth 400p (Scratches head in bewilderment) !!
On 6th April last year GNC share price closed at 390.50p ... during the days trading it spiked closer to 400p. This price was achieved long before the Peacock acquisition and on the basis of profits generated within the previous UK & US business. I am confident that the new enlarged Group will deliver enhanced EPS compared to previous years (I have read analyst & blogger estimate 20p) which if true should see the SP move comfortably beyond 400p and on toward 500p ... again I will stress that if the company issues significant volume of new shares to fund further growth... all bets are off as far as SP forecast is concerned. Share price got battered down on run in to Brexit vote and has failed to recover (Currently sitting at just above the average weighted price at time of Rights Issue) .. to me that feels plain wrong given that H1 results seemed to clearly suggest a real step change in US business performance. In my opinion with EPS of just 16p we could/should see SP at or close to 400p this would require PER of x25 (with a sector average closer to x30) perhaps it's just me but this feels very achievable .. happy to hear others thoughts & opinions ?
OK, bear with me as not great at explaining things ... The company has stated that 1st June will be used as the ex-dividend date, this simply means that on this date they will assess how many shares are owned and registered to each shareholder (individuals and institutions alike). Based on this assessment they will then pay each of these shareholders a modest sum of money (2.1p per share owned) a bit like a basic loyalty bonus or thank you to anyone who has supported the company in the form of buying and holding their stock. Payment will be made on 3rd October at which time you should receive one of the following... 1) Cheque in the mail 2) Credit direct to your trading account 3) Additional shares to value of your dividend total (only happens if you specifically requested this option) Example : You own 10,000 shares Dividend per share is 2.1p Total dividend value would be 10,000 x 0.021 = 210 pounds You payment will have deductions for tax and fees but hopefully you catch my drift ? NOTE - Company typically pays dividends twice per year, the interim payment (just announced) being less than full year end amount .. by adding the two together and dividing by your average price paid for the stock you hold it is possible to calculate your own personal dividend yield % and compare that to what % you might "enjoy" if you had placed your money in a savings account at your bank. In my experience company dividends outperform bank interest rates in most cases, but remember the underlying value of the stock you hold can go down as well as up over time plus there is no guarantee that company's will pay dividends forevever .. had to say that as I am also not an expert or qualified advisor so please don't use my posts as a reason to invest in any company. Anyhoo - Hope this helps ?
Blackrock reducing their holding means still plenty of time for top-ups ! Until there is a new institutional buyer or existing holders decide to add heavily this is going to trade sideways for a while (notwithstanding the odd mini peak / trough here and there on macroeconomic sentiment). One thing is for sure ... strong support in mid-low 2.20's and phenomenal upside potential assuming they don't dilute further !? My 12-18mth SP target = 4.00 .. I believe this should be easily achievable !
Chopster - I will try to keep it simple as possible (I am no expert in such matters, but have been here previously a number of years ago). In order to raise cash to fund the acquisition existing shareholders will be entitled to buy 9 new shares (153p each) for every 13 shares that they own prior to the qualifying deadline ... this maybe what they refer to as qualified shareholders. You are right to assume that if a shareholder is unable or unwilling to take up their allotment of new shares then their existing holding will be diluted as many more shares will be in issue after this corporate action is executed. Unfortunately I don't have sufficient cash to fully exercise my rights, but I do intend to try and pick up a few of the new shares in order to increase my overall long term holding. Expect two things to happen now that markets dust is settling after the news was announced on Monday... 1. Many shareholders will take short positions in anticipation of SP reducing on lead into the rights issue being made (Profit to be made in both directions) 2. SP will fall below 300p IMO but I doubt will drop as far as calculated average, although kind of a coincidence to see what price it fell to on Brexit morning ... ironic really eh ?! Good news is that brokers are still very bullish about the company and the recent news, average 12mth target price is 405p ... so feels like still money to be made even if not able to participate in the rights issue. My strategy is long positions only, top up when price is right (next 6wks will be good buying window) and reinvest the dividends although I wish they would improve their yield a little but better than a bank account so mustn't grumble) !! PS - I don't support the notion that market reacting negatively due to CFO leaving ... price is in reverse due to specter of many more shares soon to be in circulation at greatly discounted price ... nothing more than that.
What is your target price for this share ..? I have been in and out of this many times over the years, when I look back at some of my cheapest entry points it makes my eyes water to think what might have been if I had held long term !! Hope to see it consistently trading over GBP4.00 by end of November assuming all goes according to plan this year. Hopefully will get some clues as to how things shaping up in this weeks statement. Fingers crossed.
I have not posted here for quite some time (after many years of regular posting)... anyway, I have to say that I too am underwhelmed with the 36p valuation and even more so with the BoD's recommendation to accept. I truly believed that ALK was good for at least 50-55p if an offer materialized, however the market is very lean right now and even despite the alleged pending energy crunch there seems not to much appetite for small cap utitilies M&A ... I am astonished that we haven't seen or heard of any counter interest from any of the larger listed companies in this sector. I always thought Balfoue Beaty were a construction company (used to see their vans all over the North & east Midlands) ?! Anyway, my love affair with this share looks to be coming to a close at what I can only describe as a disappointing price, I have held and only ever added these shares nearly 10 years, I never traded them (More fool me) and I had a dummy sell on my screen at 50.5p not so long back and I didn't press the button ... that's how close I was with my beloved ALK !! Still live in hope of a last minute counter offer at a more sensible level, however with every day that passes my hopes fade and my mid turns to where my money should be placed next ... I hold VOG (Yes I am one of those long term suckers in that one) and GNC which is a very interesting defensive play listed FTSE250. I used to be a massive fan of the big insurers (CGL & AML) but that boat has sailed ... maybe just a wee top-up in GNC and keep some powder dry for VOG once Mr Market decides which way to take them (Has to be up IMHO but who knows) ?? Anyway, just popped in to say Hi and also to wish all ALKies the very best of luck no matter what unfolds. GLA - Wooly ;o)
FOLLOW THE MONEY !!!! HG were sellers prior to placing (fortunate coincidence) ... Now SP has been walked backward and ... Oh my goodness... guess who is adding ?!? Massive holder adding ... Follow the money !!! These guys know way more than your average Joe !!! YE results will be known already by privileged few ... ? Hmmmm ... Directors selling a few freebies (probably to pay tax bills), and largest institution mopping up as flighty holders exit while sp in reverse gear ... Mr Money feasts on fear. HOLD TIGHT and he will be forced to pay a fair price.... Just sayin'
Don't panic ... it looks to me like someone is reducing their holding but as for why I simply have NO idea ... the future looks very bright for ALK so I for one will be adding more during this period of unusually suppressed SP. Regarding sp predictions, well that's always something that everyone gets wrong ... so much can happen in the company and the markets, however as I have always maintained on the BB (Since 2007) - ALK will generally be valued at approx. x11.75 Earnings. (We have been as high as x18 but that was when Frenchy was splashing his cash around the industry about a year ago. Key here is patience (Bet you have heard that a million times on BBs) but it is true ... I bought my first lot of ALK when SP was 15p ... my only regret is that I didn't have the bottle to trade a few along the way instead I opted to grow my holding by just buying a few more on each dip. Whatever you decide to do, I truly believe that ALK are a little gem of a company and that sooner or later Mr Money will wake up and actually value the stock sensibly rather than at this ridiculous discount to market that seems to be order of the day ... we are very PROFITABLE and how many shares on AIM can say that (Especially those involved in the energy sector) ??? ... Not many !!! Good Luck and HAPPY NEW YEAR to all ALKies !! Cheers Wooly ;o)
I am not aware that ALK are buying oil, in fact I would say with some confidence that purchased fuel comes in the form of natural gas which itself has been a victim of recent market deflation. Your logic is sound, in that ALK are indeed selling electricity at pre-deflationary fuel rates, however we have never been advised by the company exactly how the procure their gas requirements ? It is equally possible that they may have taken out contracts on their inputs as well as their outputs, they have been very vocal in the past about how they like to know where they stand and have always tended to seeking ways to mitigate peaks and troughs in revenues, so my guess would be they adopt a similar risk averse approach to expenditure via their purchasing strategies ! It would be great if they were buying gas on a spot market basis .. that would (as you rightly point out) significantly improve margins. The SP has reacted sharply to the oil & gas market carnage, although I can't help thinking that the situation has been exploited/exaggerated by Mr Money ... only they will know for sure I guess, but 28p tree shake yesterday was a tad ridiculous IMHO. My dilemma now is how to time my next top-up ... I would rather it beat the start of the next recovery rather than near the end of the current retrace ... psychologically it makes me feel better, but in the long term its probably irrelevant. I am maintaining my BUY opinion (as I intend adding to my holding in the coming days/weeks) and my SP target remains unchanged at 46-49p. Anyway, enough of my RAMblings ... GLA & Happy Holidays !
Liberum ups target to 60p which is not dissimilar to VSA Capital target of 56p !! WB target remains slightly more conservative at 46-49p until I see something material that will persuade me different ... ? Recent market turmoil appears once again to have snagged poor old ALK like when you catch your coat on a door handle - admit it you have all done it !! LOL Keep smiling people, current PER does not reflect performance, past or potential future.
Totally agree ... The key thing about ALK is that the BOD are inherently risk averse, they like to know where they stand hence the forward selling of energy each year ... It's a great strategy as it enables them to plan properly and allocate cash to projects in a very structured manner (Rather than just splashing it about willy and indeed nilly) like many AIM stocks seem to do !! They basically hedge against the potentially volatile energy makers by selling forward the base load and then run a more speculative model with their STOR capacity .. Hopefully this will be the cherry on the cake as the UK wrestles with an aging and unreliable generating fleet and ever growing demand !! Huge coincidence that SP on the way back now that a certain someone has moved on ... Mates Rates ??? I topped up with the institutional crowd so was unable to take advantage of the recent trough ... Well done all who grabbed a few at 32p (Great investment, great price, great company) - All IMO naturally !! Over and out, Wooly