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RPC Group Share Discussion Threads
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|And, as we know, the TERP may have been deflated as some thought it was already ex-rights before Friday.|
|The TERP is what i gauge the current price to.Hence my comment the other day that i was tempted under 930p
Anyway the current price won't really matter when Kraft or Amcor bid 15 quid a share.|
|You are right Typo; my comment was addressed to ali47fish, but I may also have misunderstood his comment.
In any case, price targets are about 1100p+ and currently, if you are not a nil-paid rights holder able to sell, the cost of acquisition is around 900p... well it was a few hours ago....as apparently some folks have noticed the value ;-)|
|Sogoesit, I may be wrong but I took it to mean that ali47fish was saying 900p is not as good as someone taking up their rights at 665p. I was pointing out that the cost of taking up the rights is not just 665p, it's also the value you lose in the price you could have got selling your RPCN rights.|
|ali47fish, the "rights issue" per se is past (you cannot buy pre-rights shares).
The alternative is now to buy the shares ex-rights or buy the Nil Paid and be obligated to pay £6.65 in a few days time. If the market is efficient, which it appears to be, there is no arbitrage. But there will be transaction costs.
My suggestion was that value becomes clear to buy the ex-rights shares below 900p.
|They're given the 'Rights' in the first place which are worth something.
Yes, they're given the rights, but they pay for those rights in the fall in value in their RPC shares when they go ex-rights. The theroretical ex-rights price (TERP) is the price at which the loss in value of the RPC shares equals the value of the rights they were given. In this case, the TERP last Friday (10th Feb) was about 931p, so the loss in value since close on 9th Feb now exceeds any value gained by being given the rights.
Perhaps the concept is easier to grasp if you think of buying a stock ahead of an ex-dividend. If when they go ex-div the price falls by more than the value of the dividend, you'd have been better off buying ex-div.|
|Well, yes they are. They're given the 'Rights' in the first place which are worth something. It's then up to them whether to pocket the value of the Rights in the form of cash or complete the purchase at the discounted price and lock in that value (at no dealing cost) for continuing growth thereafter.|
|"yes but not as good price as the rights issue surely sogoesit?"
They're alrerady as good as the rights issue price, because anyone taking up the rights issue is losing the value they could have obtained for their nil paid shares (RPCN). That's why I think rights issues are a bit of a con to existing holders - they don't get any special 'loyalty deal' over anyone else buying new.|
|yes but not as good price as the rights issue surely sogoesit?|
|Looks like these are getting interesting enough to buy ex-rights amongst the "turmoil" this appears to be creating.
Below 900 definitely a buy imv.|
|RPC's record for rights issues has been excellent, in my view, and I have no hesitation in taking up the full rights in my three portfolios. Looking forward to a boost on the 23rd.|
|Subscribed for full Rights today. This bby has been a good investment for me and i dont really see it slowing that much.
My only concern, apart from global recession, is debt so am happy with Rights issue.|
|Just had a rather odd dream where RPC put out another rights offering - claiming that the first one had not been enough - and a trading update stating business was slowing down. The net result was... price shooting up to 1100p instantly on massive volume!
Can only hope this is my subconscious preparing for the results coming out on the 23rd lol! :)|
|I'm all in, new money. Some time ago, I re-evaluated my approach and recognised that I had a psychological aversion to buying more of shares which had done me well on the grounds that they seemed 'expensive' by comparison. I looked at my 'winners', decided which were still reasonable value on fundamentals, and decided to focus on those, RPC being one. I have taken up all the RI's of the past few years and they have done me proud. I expect this one to be the same.|
|Yes, the last Berenberg prior today was a Buy with TP 1200 on 09 February. So pre-rights.
Today's "adjustment" came up on my TDW broker update email. Haven't seen it repeated elsewhere.
I've gone 50/50 new money & raising finance from nil paid.|
|"Berenberg cuts TP from 1200p to 1120p today."
Was the 1200 pre-rights? If so, surely the adjustment simply accounts for the rights and they've just been tardy with the announcement.
RPC is presently my biggest holding and has done very well. Nevertheless I do worry about them getting indigestion from too many takeovers, leaving me cautious. I'm minded to sell enough nil-paid to take up the rest, but not to put up new money.|
|Berenberg cuts TP from 1200p to 1120p today.
Other recent TPs are:
13 Feb Peel Hunt 1135p Buy
10 Feb JP Morgan 1250p Overweight|
|Yes looking at the acquisitions they are earnings enhancing and it means they have greater purchasing power. They are ahead of market expectations and these aquisitions will only increase profits.|
We should have bought on Thursday?|
|Barclays have not yet credited the nil paid rights to my account at close. Is this a record for incompetence or are there others?|
|Nil Paids a good buy this morning|
|Could agree more ed. Typo you knowledge and reasoning has been very beneficial to those following this thread. Congratulations and keep up the great contributions|
|Yes, well said, Typo56. I posted because I didn't like someone trolling you.
Don't let this episode put you off. You have been very helpful and deserve better.