Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
The biggest investors are Dbay at 30% and HL at 9%. Both sitting on a nice cash pile at the moment if a dividend was to be paid
A lot More buys than sells so far, yet price dropping and it’s been hard trying to selling any. Wonder if there is a TR1 incoming sometime soon. If not I don’t quite understand the drop especially given the level of buys so far.
So what does this mean for LDG and our investment? Am I right in that once disposal completed LDG will have no investments but £127 million in cash? So in theory that would be the value of LDG?
It’s effectively the half year close today and the group seem to like fair value as the method for measuring profit, on that basis a low SP will help if they want to declare slow progress and not risk any conversation around dividends.
Clearly the group LDG are invested in is doing well, but it just feels like the actual listed shares are an inconvenience that Dbay will use at some point to get a bigger stake on the cheap.
Biggest short term issues for the sector will be labour supply. IR35 is causing massive issues since it came in, effecting all companies in this area, unprecedented issues. Logically companies who can retain drivers/warehouse operatives will do best and suspect there will be some consolidation as some companies fall by the way side.
Other big issue will be customers wanting to cut costs, I.e Tesco recent results will force them to cut their cloth so this already squeezed sector will be squeezed more.
Interesting times ahead, I think LDG owning Logistics People (basically having its own agency) may help them in the short term.
Been here since 19p and holding long. This is my number 1 prospect in my portfolio as everything I have seen so far from this company is spot on and the potential is massive.
The last share I felt this way about was Ocado when I saw the tech play and got in at around 200p it’s now 2000p and still has potential that hasn’t been tapped.
This will go up and down as it’s on AIM and green energy goes in and out of favour but I’m looking at this as a minimum 5 year hold.
DYOR and look in to the sector as a whole, it’s def an area with potential massive growth in the next 5 to 10 years
Mazzno I don’t think you are far off in your valuation, I’m in the same place.
As said below I think something or someone is manipulating this stock.
What it has done is got PI’s running scared, I have 5 friends who have all sold today on the basis that they got in at 7/8p and took the profit “while they could” because they didn’t want to loose profit while it was dropping.
Nails, some very good insight and detail.
Personally I think something is afoot with this share, either some short positions being played or the main investors driving the SP down to buy more on the cheap.
Even with the pessimistic views of some on here the 49% share is valued at more than the c£70m current market cap. Think Truth who is fairly knowledgeable valued it at around £100m+ even after some back tracking, so this is very much on the low side for the SP if you are thinking of taking a long position on this.
Comparisons are hard due to the structure, but if you look at a company like DX they have a market cap of £175m on a fraction of the revenues and profit of GWSA/Marcelos who LDG have 49% interest in.
On the face of it this should be a Buy as SP seems under valued at the close SP, but you have to wonder why it’s dropped so much. With current structure and the main investors reputation it just feels as if something is being managed in the background to someone’s advantage but not that of the average PI.
Personally I’m holding as thing the good results of GWSA will filter out (they seem to have been muted so far) to a wider audience and it will drive some interest and price will get back to somewhere more logical.
This is a crazy stock though and I can understand why some investors have took there profit and moved on. It’s like a warm pint of beer, you want to finish it but not sure if you can.
Truth. I wonder if the GWSA accounts will be published which would probably hold the answer. Based on revenue if you brought the payment cycle from customers forward by 30days you could reduce debt by £65m just by being paid earlier
Interesting how on the 24th November the SP rocketed only to get ESL to issue RNS, which helped bring it back down to a low position which helped them justify selling themselves and friends shares on the cheap and also helped keep the SP low to deliver a loss in today’s accounts. This has then helped the SP drop so they can pick up more shares on the cheap.
Bet tomorrow or next week the turnaround will be all over the press and the SP will go up with Dbay being the biggest winners, again!!
All IMO but seems like they know how to manipulate things to their advantage
GWSA profit of £145m not a bad turnaround.
Truth, your maths is correct, but you’ve made some very high level assumptions and managed to neglect some fundamentals.
We don’t know that debt will be £200m, we also don’t know what the debt is made up of. If it is current debt then you wouldn’t deduct it in this way, at least not without consideration of assets the company has, which you excluded altogether from your calculation. You also need to consider how the debt is structured, is it secured or unsecured.
You’ve also completely missed the main intangible asset which is the Eddie Stobart brand and the reason some people are invested.
Ultimately it’s a tricky business to value due to its strange structure, past history, unknown outlook and lack of recent financial information.
I think £150m market cap is more reasonable as I’m assuming brand is worth something, debt will have reduced and the company has some form of assets.
So 21p a share is my fair valuation, but the markets will go above that IMO based on sentiment
I heard it was 2, and why would the SP get slaughtered, surely there is context around it, and have they won things that replace and improve upon what has been lost? Logistics is very cyclical, contracts regularly change between the providers, having worked in the industry in the past sometimes a loss is a good thing as what was on the table isn’t worth doing.
Hopefully the next RNS will provide update on trading outlook.
Results I think will be good, but will they meet expectations? For me how much they have reduced debt by is key and what is the outlook, have they renewed contracts or won any contracts etc. But yes I think it will rise.
I’ve heard on the logistics grapevine that they are exiting part of Tesco, no idea what scale, so an update on that would be helpful.
What’s behind the SP drop this afternoon, anyone know? See point below ref DHL, what’s the relevance of that comment?
They already run the Tesco site in Doncaster so won’t be Tesco. ASDA have a big site in Doncaster so maybe that’s it. Hopefully all will be revealed in next RNS
Yes, really good update, surprised this hasn’t gone up more, but some times the slow upwards burn before final results is better than a sharp increase and then a drop
This share still feels undervalued, good update, better results, investment, good brand and £8.7m in the bank, but still only has a M Cap of £15m.
This is a tough market with low margins and more challenges to come with the fall out of COVID and brexit.
Personally the asset is the brand and the cash, at this price it’s ripe for a takeover, which may not be the worst thing for us investors.
Feels like the markets are finding other shares more interesting at the moment and this is sitting in the background, bit of momentum upwards would be nice though!!
If trading update RNS is out by end of month I would expect something about the below in the update and also any other contract wins/losses. LDG seem to keep their updates to a minimum.
What are peoples views on how good the results will be? And based on the RNS pre Christmas outlining expectations for full year results how much is already reflected in current SP?
Personally I think the debt element will be key to SP rising significantly, if good results are posted and debt comes down I think that will pull new investors in.