Share Name Share Symbol Market Type Share ISIN Share Description
Fairpoint Group LSE:FRP London Ordinary Share GB0032360280 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -4.00p -4.44% 86.00p 85.00p 87.00p 90.00p 86.00p 90.00p 89,817 15:22:09
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
General Financial 54.1 -5.7 -14.3 - 36.48

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Date Time Title Posts
20/9/201613:42A new lease of life? - that's a fairpoint ! !514
22/8/201317:05*** Fairpoint ***5
25/6/201209:38Fairpoint - Pointing in the right direction4
28/9/201110:50Fairpoint - Fair point, well made-
13/9/201114:31Fairpoint Group - Fighting the Head Winds-

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Fairpoint Group Daily Update: Fairpoint Group is listed in the General Financial sector of the London Stock Exchange with ticker FRP. The last closing price for Fairpoint Group was 90p.
Fairpoint Group has a 4 week average price of 100.97p and a 12 week average price of 105.99p.
The 1 year high share price is 193.50p while the 1 year low share price is currently 86p.
There are currently 42,415,179 shares in issue and the average daily traded volume is 118,508 shares. The market capitalisation of Fairpoint Group is £36,477,053.94.
adamb1978: Given how the share price has tanked, a flat H1 year on year isnt a bad result. The company is now trading on such a low multiple that its implicitly factoring in a sharp falls in profits. The c6% yield is covered 2x - 3x so is rock solid. This isnt an exciting hod, but I'm struggling to see much downside from here
rndm355: Hi folks, I have provided some analysis of FRP at ShareProphets:
rivaldo: Yep, good post GHF. Must admit to reassessing and coming to the same conclusion, so I sold my small initial stake on Friday. Nowt particularly wrong, but as GHF says perhaps not too much upside, especially given the lack of EPS progress over the next couple of years. Cue a large earnings-enhancing acquisition and large share price rise :o))
glasshalfull: Courtesy to say that I've sold out this morning...sorry it dented the share price. Hopefully short lived for holders. I'm not a day-trader and at 2- days, this has proven to be one of my shortest lived holdings for a while. I cut my position on the back of listening to yesterday's webinar and also reviewing forecasts. Both Shore Capital & Panmure have shaved profit forecasts for the current year marginally, by 3% & 2% respectively. Equity Development have also done likewise with a 2% reduction in their case. All fairly small beer but essentially it washes out that expectations for the Debt solutions business are reducing further than the upgrades coming through for the Legal side. This leaves forecasts for the year ranging between EPS 19.3p & 19.6p. Therefore negligible growth in overall earnings this year, notwithstanding any contribution from acquisitions which I'm certain will materialise. Lower margins are also forecast this year at 18% (vs 21% in 2015) due to margins falling back slightly in the debt & claims side. Debt is however higher than I'm comfortable with, especially with management reiterating the acquisition strategy that is summarised in rivaldo's post above (post 445) & confirmed via yesterday's webinar. Net debt was £13.6m at yr end & is only forecast to fall to £10.9m by end of 2016 given the contingent consideration due following the Legal business acquisitions. While I recognise they have a £25m facility to support acquisitions, should they deliver on the two types of acquisitions proposed, then naturally debt will climb further & may require some form of fundraise down the line. See there's already been debate on the thread today centring on dilution. Factoring in current debt also highlights that the shares aren't quite as cheap as the headline PER of 8 suggests. Market Cap of £71.7m & therefore an EV of £85m, which I now believe fair value given my concerns over debt & commentary highlighting lower forecasts for the Debt solutions side; muted concerns over the small claims limits/ whiplash claims & fairly static earnings progression forecast for the next 2-years due to the potential contingent consideration requirements. These earnings forecasts of course discount any earnings enhancing acquisitions. Essentially once I considered all factors the risk/reward wasn't as appealing. Best wishes to holders. Kind regards, GHF
nehpets81: Good question, there is a maximum amount payable if the acquisitions hit their targets and a fair value scenario. The fair value situation as I understand it is a contingent consideration of £4.5M for the Colemans acquisition and a further £2.3M relating to the Simpson Millar acquisition so if we halve these we get £2.25M and £1.15M respectively. The issue share price for the Colemans consideration is 132p and Simpson Millar 141p. So, the total number of shares likely to be issued for these is about 2.5M. For the maximum possible it is 3.7M shares. Given the total number of shares in issue is currently about 46.8M, this represents a maximum dilution of nearly 8% with a fair value dilution of nearer 5%. This is not ideal, but the debt levels are at the upper limit of what I would be comfortable with and given the decline in all of FRP's other markets, this dilution is necessary in my view. The above is all fairly quickly worked out so may contain errors!
adamb1978: A1PAPPADINGDONG The way to think about it is that the company has an equity value for 100% of the company (which is equal to the enterprise value minus net debt). And that equity value then translates into a value per share by being divided by total number of more shares should mean a lower share price (again, in theory, for options there is an option value which an optionholder has to pay to exercise the option, which therefore would reduce the net debt and hence an offsetting effect). In theory, the market knows about these potential shares being issued so should already discount them being issued by looking at the fully diluted number of shares. Whether or not that in fact is the case is debatable and probably varies from company to company but I wouldn't be expecting the share price to fall when they are issued (partly also because them being issued will be accompanied by an announcement that the acquisition has performed well). adam
a1pappadingdong: Hi Shauney Thanks for your reply. I thought that any amount of shares being issued would dilute the share price, regardless of whether or not they are sold? Anyway, I dont see any reason to sell at all, especially if they keep growing and making acquisitions such as this. The information about the share options being directly related to the share price being above 200p is also very useful. Thanks again
shauney2: No short term because "The vendors will be restricted from dealing in the 1,061,647 Earn-out Shares issued until after 30 June 2016" and long term if Simpson keep out performing as you say the bottom line will grow. Its also worth reading this RNS from last year re the Fairpoint Group PLC New option schemes "The exercise price was set based on the closing mid-market price of the Ordinary Shares as derived from AIM for Friday, 12 December 2014. The options vest subject to performance conditions and continued employment within the Group. The performance conditions applicable to the options require that the Fairpoint share price must equal or exceed 200p for a continuous period of 30 calendar days at any time during the period to 15 December 2017" Thats always been my target but you never know.Aim and illiquid so buyer beware.
a1pappadingdong: Hi AllI to am very encouraged by the performance, but I don't fully understand the implications of these "earn-out-shares" coming onto the market.Will this mean a short term fall in the share price when the new shares are issued?Obviously the revenue and profits from Simpson Millar will add to the bottom line over the longer term.However I hold this share in long term and short term accounts. Long term I'm happy to hold, but I'm wondering if short term it's better to take profits before the 30thThanks in advance.
paulypilot: Hi, I agree with the above. To my mind a PER of say 10 times is justified, so for 20p EPS (next year) that arrives at a share price of 200p, which is my personal target price for this share. Am not saying I would sell at 200p, just that in my opinion it's a realistic target. Personally I bought in at an average price of 122p, and locked in a near-6% divi yield, so it's an attractive share to keep for the divis. Good growth from acquisitions, and net debt is still fairly modest, even after the latest acquisition. I particularly like the way the deal was structured, with self-funding earn outs. Good, because it de-risks things for us. Regards, Paul.
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