International Distributi... Share Discussion Threads

[cockneyrebel] 16/10/2010 10:24

Ta Connor - 240p still seems a bargain for any buyer imo and I'm holding for at least that. The recent action in the share price looks interesting too.

Simon Thompson is basing his target on the coming years forecasts but I think the company are likely to be trading well ahead of forecasts and likely to see upgrades imo.

The next trading statement is due early January and I think there's likely to be news before then.

CR

[connor23] 15/10/2010 22:51

View from Simon Thompson at IC

Shares in Ideal Shopping Direct have more than doubled since I recommended buying at 91p last autumn (Investing in an Ideal World, 12 October 2009), having reiterated the advice at 140p in January and 150p in March. At 198p, they now trade on 13 times 2011 earnings estimates, assuming EPS rise from brokers' estimates of 12.3p for 2010 to 15.5p next year, and have hit my fair value estimate of 200p. However, there could be more upside to come as the company is undergoing a strategic review which could lead to the sale of the business.

Given Ideal Shopping has a market value of £68m, and has net funds of £13.7m, then the business is currently being valued at 5.4 times next year's cash profits. The company also owns freehold property worth £6.7m and retains unutilised tax losses to offset corporation tax on its profits. In my opinion, a bid of 240p a share would be a sensible take-out price as this would incorporate a bid premium of 40p a share - funded using the cash on the balance sheet – and equates to a reasonable exit price of 7 times 2011 cash profits. So if you followed my advice I would run your profits, targeting a further 20 per cent upside in the event of a bid materialising.

[dnfa1975] 14/10/2010 11:29

chart awesum

[nurdin] 14/10/2010 08:00

..and marked up a tad this morning.Have a feeling we are going in for a good day...:o)

[cockneyrebel] 13/10/2010 22:06

re-testing the highs :-)

CR

[choppa] 11/10/2010 20:22

Good day here then :-)

[tsigoloroh] 11/10/2010 09:44

imagine what might happen if they said they were in offer talks

[bigbigdave] 11/10/2010 09:42

Indeedy 8-)

[nurdin] 11/10/2010 09:33

Blimey ! Bet you are smiling BBD..:o)

[bigbigdave] 10/10/2010 12:58

Careful boys - you'll be persuading me to buy even more!
Largest holding by a long way.

[nurdin] 10/10/2010 11:14

Yes I like that bit too:o)

With the businesss also starting to throw up lot of cash now (added £5m to the kitty last year),id be very surprised if IDS go for less than 12x forward earnings of 22p excluding 40p worth of cash..that suggests a minimum exit price of 300p including cash..Even that looks cheap but lets not get too greedy...:o)

Edited...was getting a bit carried away there..;o)

[cockneyrebel] 10/10/2010 10:21

liked this bit:

"adjusting for the £13.7m cash, the PE is less than 6x. Little wonder then that management continues to evaluate a sale of the business to unlock value".

CR

[bigbigdave] 09/10/2010 10:33

Phew, at this rate the chart is going to resemble a smallcap miner 8-)

[nurdin] 09/10/2010 10:19

yup..tips flowing now.Midas tomorrow? :o)

[cockneyrebel] 09/10/2010 10:15

given a buy again in SCSW - says PE 6.5 when you strip out the cash.

Quote:

"Little wonder that the management continues to evaluate the sale of the business to unlock value - Buy for that"

CR

[choppa] 09/10/2010 10:07

A good week for the good ship patience and all who sail in her ;-)

[cockneyrebel] 08/10/2010 19:24

Ta Simon :-)

CR

[simon gordon] 08/10/2010 19:17

IC - 8/10/10:

How to Make Money from Mergers

Given these strong results, we reckon that a 200p price tag is fair value for Ideal Shopping – even without a bid premium. Firstly, 200p values the equity value at £67.3m, but the group has strong cash conversion and has a net cash pile of £13.7m. So, taking this cash away, the equity value is £53.6m. Singer Capital Markets forecasts pre-tax profits for the full year of £10m for 2011, with cash profits slightly higher. So a price of 200p would value the company at just over five times forward cash profits, which looks very cheap.

Combine this with the fact that the group could benefit from unutilised tax losses, and has strong asset backing with freehold property on its balance sheet worth £6.7m, a deal price for the business nearer 250p looks reasonable. This would imply an exit multiple of 7 times cash profits using Singer's forecast – that's hardly demanding.

So the upside looks good, anywhere between 23 per cent and 53 per cent. But is someone likely to snap up the business? We reckon management and shareholders will want to ensure it happens – chief executive Mike Hancox bought £400,000-worth of shares in September 2009. Meanwhile, having acquired horticultural retailer Lead The Good Life late last year for cash and shares, these shareholders will want to push for the highest sale price possible.

[nurdin] 08/10/2010 16:07

Perhaps a major tip in SCSW tomorrow? Have noticed that shares that move for no apparent reason are often tipped in the magazine the following weekend.

[bigbigdave] 08/10/2010 14:48

Well worth the wait 8-)

[nurdin] 08/10/2010 14:47

Looks like some news has leaked out...:o)

[cockneyrebel] 08/10/2010 14:33

Whoosh !!!

Nice breakout.

Strategic review news coming?

CR

[cockneyrebel] 08/10/2010 10:46

Breaking out here today.

CR

[nurdin] 08/10/2010 10:42

Coiled up as they say :o)

[cockneyrebel] 08/10/2010 08:43

ticking up - any breakout here should be a biggie - high goes back to April.

CR