Phoenix Share Discussion Threads

[eeza] 13/10/2016 11:08

QuePassa - you're trolling, on multiple threads in a vendetta.



Disgusting & childish behavior.

[quepassa] 13/10/2016 10:47

Time to sel lPhoenix ,and put proceeds into ASHM,better dividend also at over 6%.If GARYCOOKis ramping Phoenix,then definetly time to sell.

[garycook] 13/10/2016 01:55

If you can afford it,take up your rights in full.Then if you are overweight sell what you do not require.New price will be at lowest 7.16 plus and you have a share owing you 5.08.If you do not have the required cash,buy what you can afford and sell the rest of your rights.

[pete_sts] 12/10/2016 21:14

Thanks for pointing that out sogoesit, you're absolutely right. Cayman Islands company hence no stamp duty.

@jonwig on the subject of market risk it seems to me that the approach I described works quite well. If we define market risk as 'uncertainty about the price per share that you will have ended up paying once the rights issue has finally completed' then we can rank the various strategies like this:

1. Sell everything now and buy back in once the rights issue is completed: maximum risk -- the price may move a long way and you could end up with a much higher (or indeed lower) price per share.

2. Hang on to all your shares, wait to get your nil-paid rights and sell some of these to fund the purchase of the rest of the rights at 508p: fairly low risk -- depending on sentiment the price of the nil-paid rights will vary, so the ratio between the number of rights you need to sell and the number you need to buy is not fixed, leading to a small uncertainty in the price per share. Most of your holding just stays in the market, significantly reducing the market risk compared to option (1), but there is still some uncertainty.

3. Sell exactly the number of shares that you need in order to fund the purchase of the rights-issue shares that will be awarded based on the shares you retain (which in this case happens to be about 25% of your initial holding): lowest risk -- because the price of the shares in the rights issue is fixed, you know that for every 16 shares you had before the rights issue you will have 19 shares after the rights issue, so there is in fact no uncertainty in the price per share.

4. Hang on to your existing shares and put in the extra cash necessary to buy all the shares: lowest risk. Again you know exactly how much extra cash you will need to inject, so there is no uncertainty in the price per share.

Does this sound right or have I made a mistake somewhere?

Of course, for a lot of us, (4) is a problem because PHNX has done pretty well over the last four years and pumping more cash in would distort our portfolios, so I am thinking I will go for (3).

[sogoesit] 12/10/2016 17:49

Good idea pete_sts.
I was doing the calculations this am and certainly I needed to raise a significant amount of cash which the sale of nil paid rights alone would not deliver sufficient to meaningfully take-up other new shares. Remember there can also be (more) volatility in trading nil paid rights too as I recently learned with MRO.
I have started to sell down today at 880p (also having at the back of my mind, as jonwig says, raising of cash at recent market highs).
Thanks for all comment.
PS PHNX is a Cayman Islands company & is SD free in any case. (Not sure if that's the reason but on none of my purchases has SD been levied)

[jonwig] 12/10/2016 14:37

pete - there are lots of strategies, and selling part of current holding takes us back to post #1886, where you're exposing yourself to market risk. If that's your stance, it really depends on you taking a view and acting on it.

FWIW, I've sold quite a lot of our portfolio recently as a de-risking exercise, and am inclined to sell my nil-paid in the market.

[Yes, rights and new shares arising are stamp duty free.]

[pete_sts] 12/10/2016 13:37

jonwig -- you rightly say that you can sell some of the nil-paid to raise cash to take up the rest.

Seems to me that another approach would be to sell about 25% of the holding now and use this cash to take up all the remaining rights.

The discounted shares are pitched at roughly 4/7 of the current price. So for every 16 shares, you can sell 4, raising 4P cash (where P is the current price). This leaves you with 12 of the original 16 shares, and the necessary cash to take up your rights is then 12 x 7/12 x 4/7 x P, which equals 4P, which is the cash you raised in the previous sale.

Anything wrong with doing this way? I'm guessing rights issues are still free of stamp duty, so no tax implication? Any other reason why it might be a better idea to wait for the rights and then trade off some of the nil paid?

[sogoesit] 12/10/2016 09:04

Indeed, jonwig, thanks.
As you say, there is a half-way house solution too.

[rcturner2] 12/10/2016 07:18

I have sold the other half of my holding. Good luck to all who remain. I'll be back in the future if the share price drops.

[jonwig] 12/10/2016 06:25

Sogoesit - there's market risk as you'll be out of the stock for a while. That could work for or against you, but it adds to uncertainty.

Another possibility, already mentioned earlier, is to sell some of your nil-paid to raise enough cash to take up some rights.

stevenrevell - what you do is a personal affair. For some, a day is 'long-term'!

[sogoesit] 11/10/2016 21:35

My thoughts on this, which, if I take up my rights, is going to cost a lot of cash.

The current trailing yield at 890p/share is 6%.
If the forecast dividend post-rights is 50.1p then, at a theoretical ex-rights price of 749p, that will equate to a yield of 6.7%.

To my mind, the forecast yield is high for the history of this stock so the price may continue to rise pre-the ex-rights day.
So, the dilemma is do I take-up the rights to gain an additional 0.7% yield, or less, at the cost of 296p/new share or sell-out (all my holdings are profitable) and re-invest post-rights? In the time frame for this to consummate I am not losing any dividends (?) as far as I can see.

I am inclined therefore to sell out pre-ex-rights in a few days. It is likely I am still going to get my threshold yield of 6.0% and I can keep my overall exposure at a manageable 5% of my portfolio by re-investing post-rights without it costing me an extra 296p in cash.

[stevenrevell] 11/10/2016 12:44

Is it worth holding on or take profits any advice

[stun12] 10/10/2016 17:06

LOL, point (and advice) accepted.

[jonwig] 10/10/2016 16:14

stun12 - yes, I'm here and post often, if you look back.

I don't really want to clutter the header so that you have to scroll right down to reach stuff. (Though I agree it's out of date and needs some attention.)

As for relevant dates, I have a wall calendar (cheaper than an e-device) which is quite effective.

[rcturner2] 10/10/2016 15:49

He posted on the site yesterday, send him a private message.

[stun12] 10/10/2016 15:19

Is the original person who set up the thread still about please? It would be nice for the rights timetable to be posted in the heading. I'll put the link to it here for info too:

[garycook] 07/10/2016 01:25

Steve,Only meaning that the PHNX,SP could be higher or lower from 832.50.Atm higher which is good.

[novision] 06/10/2016 22:48

Trump might be president !!

[stevenrevell] 06/10/2016 15:42

What can change gary

[garycook] 06/10/2016 07:45

So that confirm,s 50.15p.PHNX.are also giving an adjusted price of 716 on the 28th of September price of 8.3250.So at yesterday,s closing price of 875 and adjusted,it would be around 770 that gives around a 6.6% Yield,But things could change between now,and the completion of the rights.

[jonwig] 06/10/2016 07:37

There's a lot of waffle in the prospectus about percentage increases in the dividend and 'adjustments'. Only on p56 do they reiterate that the total dividend paid in 2017 will be £197m.

On p49 they confirm that the total number of shares following the issue will be 392,821,632.

[jonwig] 05/10/2016 08:44

Prospectus download from here:

[jonwig] 05/10/2016 07:59

That's the intention, yes, though a lot could happen in the coming three weeks!

[garycook] 05/10/2016 07:47

jonwig,Are you taking up your rights in full ?

[jonwig] 05/10/2016 07:44

We've some dates:

20/10 ... record date for rights entitlement.
25/10 ... shares marked xr.
08/11 ... payment required (brokers will have their own, earlier deadline.
09/11 ... dealings in new shares.

Circular and prospectus should be on website soon.