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Real-Time news about Biogen Inc (London Stock Exchange): 0 recent articles
|liarspoker: INRE - nice one mrionion. :O)
Morson is one I held and got taken over recently ( MBO ) albeit at a large discount to intrinsic value. I wonder if they doscontinued the divi on purpose to cause a large fall in share price in order to buy the company back on the cheap.|
|davydoo: Im currently reading Buffetts annual letter to Berkshire shareholders.
Interesting piece in there about share buy backs and share price performance.
Should give some comfort to anyone holding ARGO.
Conversely, scares the bejeesus out of me when i look at buybacks at RMV|
|liarspoker: Initially the spread was a little over 10% in the portfolio. The remaining 9% or so comes down to share price performance. Therefore the stocks are cheaper now, as a group, then when I made up the portfolio.
Most of these companies are nothing like the net nets that Graham and Buffett used to invest in so caveat emptor !|
|hugepants: Thanks adam.
So the full effect of the lost client won't show till next years results. At current share price of 14.75p then forecast earnings of 1.3p for next year gives PE ratio of 11.5 which isn't that great. However forecast yield is 10% and the balance sheet contains 8.8p per share in cash and 11.8p per share of net working capital.|
|adam: I bought back in recently a titular holding as a marker. I have, essentially, no position at present, though I do think it is good value.
Market Cap £30m
Investment summary: Record not broken
The loss of an important client has been a knock to Record, due to high operational leverage (revenue losses cannot easily be offset with cost cuts). That knock should be separated from the decline in earnings and the share price since flotation in 2007; the company was then very dependent on the management of high-margin absolute return funds, invested in a strategy that stopped working with the financial crisis. To do otherwise is to overlook what appears very much to be the right strategy of a broadening product range, increasing marketing reach, and deepening customer penetration. Success would see operational gearing working in the company's favour. Balance sheet strength gives Record the time to build track records for new product launches and benefit from its distribution investment.
In line with recent guidance
PBT of £3.7m and an interim dividend of 0.75p are in line with guidance given the loss of its second-largest dynamic hedging client, the source of some £2.6m in annual revenue, which cannot be matched by cost reduction. Near term the shares and consensus earnings are adjusting to this (we expect consensus for this year to settle closer to £6.0m PBT). Longer term, the success of strategic moves is key.
Record is well advanced on its strategy of product broadening, supported by an infrastructure that aims to sell more product and more products per customer. Building a track record for the expanded suite of absolute return products, giving "multi-strategy" capability, will take time; meanwhile, management remains confident of winning new hedging mandates.
Valuation: Don't throw the baby out with the bathwater
The trend in earnings and dividends reflects the shift in the group's position since flotation. Given the strategic investment in the business, the near-term outlook could quickly change. The forecast pay-out ratio is high on consensus earnings, but earnings, while still at risk from customer concentration, are much less exposed to the trend shifts of recent years and factor in no optimism for strategic success.
Year End Revenue (£m) PBT (£m) EPS (p) DPS (p) P/E (x) Yield (%)
03/10 33.4 16.6 5.38 6.16 2.6 44.8
03/11 28.2 12.5 4.03 2.59 3.4 18.8
03/12e 20.3 6.8 2.05 1.50 6.7 10.9
03/13e 18.1 3.9 1.30 1.50 10.6 10.9
Sector Financial services
Shares in issue 221m
Record is a specialist currency manager, providing both absolute return and currency hedging mandates to institutional clients. Services include currency alpha strategies via either currency funds or segregated accounts, active and passive hedging.
Extended product range yet to impact.
Increased focus on distribution.
High yield/strong balance sheet.
Customer concentration risk.
Limited cost flexibility.
Lack of clear trend in asset returns.
Martyn King +44 (0)20 3077 5745
|hugepants: Been buying some TRE. Valued below cash and are liquidating by the sounds of it. Price is 35p and last reported NAV was about 95p. Seems to be getting hit by carbon price collapse but it has a private equity portfolio as well as the cash and carbon stuff.
Also check out REC. I think it was adam that mentioned this one a while back when it was 25p. Its now 15p. Paying a 0.75p dividend shortly and expect to pay another 0.75p dividend at year end. H1 earnings were 1.26p and about 60% of market cap covered by net cash. They recently lost a major client which seems to have hit the share price a tad. Cant find any broker forecasts for this one.|
look at PMHL, currently trading at 90p:
From the header:
NAV = £3.14 per share (Updated 13.9.11) (£1 = Yn10.1)
NAV calculated from last Annual Results and latest market price for the ACC stake. All new investments in the current financial year are valued conservatively at cost. Recent comments from the company suggest the property developments are progressing well and profits from these developments should add substantially to the NAV.
The company's current undervaluation was highlighted by the chairman on the 13th January 2011 when the majority holder PIHL entered into a share exchange agreement with certain PMHL shareholders. The price paid was equivalent to HK$22.2 per share (178p).
Mr. Wong Ben Koon, Chairman of Prosperity International said, "The acquisition of PMHL shares is overwhelmingly supported by institutional and fund investors which show their confidence in the Group's outlook. Given that the PMHL Shares are currently trading significantly below their net asset values, we believe that acquiring further PMHL Shares will enhance the companys book value."
Furthermore the company has recently stated that it is committed to closing the gap between its share price and the NAV and will continue to seek ways to narrow this, including continuing the share buy-back programme. Although the company's efforts to date have not been sufficient to reduce the discount to NAV.|
|hugepants: Ive not looked closely at the proposed acquisition adam. I assume PCTN see some benefit in the merger but looking at the PCTN share price it doesn't look like its gone down too well with PCTN shareholders.|
|hugepants: I picked up a few more NSN at mid-price earlier.
They are returning approx 21p shortly
Current share price is 63.5p. Market cap = £18.5M
Net cash + "financial assets" is approx 105p per share.
On top of this also hold 80% of UEP which is worth approx another 15p per share at the current UEP share price. Note the UEP stake is consolidated in the NSN accounts so you dont see it valued in the net asset value since the UEP NAV is only around £0.9M
The proposed 21p cash return should have rerated the share price somewhat in my opinion. Maybe once the cash is returned there will be some value outed with a disproportionate share price change.
EDIT: My mistake. The UEP stake is currently worth about 30p per NSN share. Probably take with a pinch of salt given NSN hold 80% and its highly illiquid but UEP do have options on oil licences in Papua New Guinea.|
|moathunter: davydoo - 25 May'11 - 12:11 - 338 of 340
I would be interested to hear opinions of other value investors in relation to share prices on the day they go ex dividend.
Theoretically, there should be *no change in the wealth of the investor* before ex-div and after ex-div with a small share price fall. This is best shown by an example.
Imagine a simple company is worth £100m to equityholders (has a market cap of £100m), has no debt and £100m in assets and it made £7m profit last year. It made a 7% return on invested assets (£7m/ £100m). Imagine £4m of that £7m profit must be reinvested back into the company to maintain its sales volume and competitive position (hence profit margins) to generate profit in future years. Call that reinvestment "maintenance capital expenditure/ Capex".
That leaves £3m of profit remaining that might be paid as dividend.
Assume all the shareholders of the company could earn 7% p.a. return if they invested in other companies on the stock market. And the company earned 7% last year as mentioned above. The company should rationally only reinvest the remaining £3m as growth Capex to grow the company IF it can earn 7% or more on that £3m over future years.
If the company fears they'd earn less than 7% on that £3m excess money ('excess' beyond maintaining the company's competitive position), they should return it to the investor as a dividend to earn 7% elsewhere.
Equally, if a company gives nil dividend and instead earns 7% p.a. on all the £7m profit retained, the investor will earn the same 7% on that excess £3m as if it was given to him as a dividend and he earns 7% elsewhere. Hence no change to the wealth of the investor.
Said differently, assume the share price is £100 before dividend. The company distributes the £3m excess profit as a £3 dividend per share. Ex div the share price is £97 and the dividend £3 = £100 so no wealth change to the investor, but the company has fallen in value to £97 per share because that £3 dividend is a coupon paid now that the company could have retained in order to pay out more coupons in the future that, discounted back to the present, would total £100 in value.
The investor could either reinvest that dividend back into the company or invest in other companies to earn 7% (or plain spend it).
Reinvesting that dividend into the same company is the same as earning 7% elsewhere, because the company has already said "we cannot earn 7% or more with this excess £3m, so you have it". Through buying more shares, you're buying a slightly larger % of a company that earns 7%.
If the investor experiences no change in wealth, why does the share price usually fall a little ex div? "A bird in the hand is worth two in the bush"- people like the certainty of the dividend in the hand against the uncertainty of whether any more will come from the 'bush'/ company. And the new investors value the company at £97 per share due to missing out on a dividend.|
Biogen Inc share price data is direct from the London Stock Exchange