||EPS - Basic
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RPC Group Share Discussion Threads
Showing 1251 to 1274 of 1275 messages
|sorry Mornington should read EPS!|
|Mornington, when you say 2017 is the first year that the EPS will be down, are you referring to the dilution effect of 25% more shares in issues frim rights? Do you have any broker forecast figures for year end march 2017?|
|company seems to be doing well
and the latest acq also looks a good deal
but 2017 is the first year for a long time that the eps will be down
so I wont be surprised if share price settles for a while
that may take the whole of this year|
No harm in questioning, but RPCs record of success with previous acquisitions is, for me anyway, very reassuring. I don't see why the latest purchase should be any different.|
|Let's hope the end is not "in tears"!
I bought this on the basis of the fragmented market and the consolidation play.
I was surprised they "lurched" into the US which can be a graveyard for UK companies (mostly in the retail sector) but held on for the diversification of currency in a weak GBP world.
The upside looks like about £11 to me so, on the risk/reward basis, it still looks good.
I make chart support about 850'ish.|
|Well after the Enterprise Inns debacle, you'd have thought I would learn, wouldn't you?!
The issue with ETI and PUB was what happens when the merry-go-round stops (in those cases they hoovered up most of the market between them and simply ran out of things to buy!). The market RPC operate in is so fragmented we are nowhere near that point but one certainly needs to be looking at the question 'how will this all end?' (a question, incidentally, I posed in the header of my ETI thread but failed to answer!).|
|Ian, does it not remind you of the late 80's a little.
They reference once again further potential acquisitions.
Some in the market starting to question this perhaps?.|
|Well, over the years it has turned into my second largest equity investment and stands significantly 'overweight' in my portfolio, so I suppose I have a rose-tinted view. I haven't yet looked into the claims of 'aggressive accounting' but a quick skim of the article seems to come down to a perceived squeeze between a lack of 'pricing power' and rising costs. I don't know about the rest but one of the things I've always liked about RPC is the strength of its pricing power, so one of us is getting it wrong! Many of RPC's customers are tied to it by design and patent issues (e.g. the Tassimo coffee capsules developed for Kraft/Braun) and its contracts also provide for price adjustment (in both directions) to reflect changes in oil and polymer prices, so whatever else is wrong, I can't believe that "pricing power" is one of them.|
|Phil, many thanks for that post yesterday, off my list having read.|
|A bit of short- trading jiggery here perhaps? And where has Spoole5 come from.|
|Thing is all the top brokers are afraid to criticise the company because of the constant flow of deals they want to earn fees from. This could be a house of cards waiting to fall down.|
|search FT report , Northern Trust accusing co of aggressive accounting practices !?
Some damning statement really and clearly whats done the damage today for sure
i wonder what the company will have to say about that......cause i think they might have to address it|
|Yes, pre-close trading statement on 30th|
|Isn't the update due on the 30th?A bit too early for that stop chase isn't it?|
|Classic timing before trading update to get shares on the cheap. The story hasn't changed let's see what the trading update brings|
|"management sold a significant amount of stock"
2 directors sold post exercise but not all.Will be interesting how far this can be taken down.
Could be a good buying opportunity after the trading update next week.|
|This is how capita got so big, endless acquisitions, look what happened to them. Always wary of companies trying to buy growth.|
|Sell note out from Northern Trust this morning..
Blimey -- seen this Northern Trust going for RPC Group
Going at them hard
Paul Moran round there
RPC Group PLC (RPC:LSE): Last: 889.67, down 21.33 (-2.34%), High: 920.09, Low: 889.33, Volume: 685.08k
Let them do the talking on this one
Plastics and stuff, isn't it?
We believe RPC is a business that is stuck in a structurally weak position, caught between a weakening relative price position with customers and its labour cost inflation. These trends will worsen we think. It is our view that management is
using a dramatic step-up in acquisitions in the last 12 months (10 deals and a doubling of revenues) and some of the most aggressive accounting we have seen, to help mask these risks. Given a history of weak free cash flow generation (FCF)
and a levered balance sheet, RPC’s acquisitions require rights issues – and therefore, a compelling equity story. This is an equity story the sell-side has been very bullish on for many years, perhaps because of underwriting deal fees on offer.
Multi-year restructuring programmes and acquired synergies have delivered surprisingly little real gains in true net income or FCF in our view. Innovative management incentives and definitions of returns on capital or return on assets, are
encouraging value destructive deals we think. This can be clearly recognised in the erosion of returns on capital, which on our analysis, are now well below the cost of capital. After the FY16 accounts, where the raw material tailwind effect failed
to materialise, management sold a significant amount of stock. In H1, this tailwind effect was even weaker on our analysis. We think consensus assumes the drag from one-off costs disappears and ‘adjusted’ profit matches the true underlying profit figure.
We disagree and believe that a strategy to buy industry peers in other segments or geographies, with modest synergies, doesn’t alleviate structural threats of pricing power and cost inflation, it just reinforces them. We accept that a rights-issue funded, value destroying roll-up story can continue to report ‘adjusted’ EPS growth for as long as shareholders are willing to fund it. But should the hitherto supportive appetite for rights issues fade, we think shareholders will find a structurally challenged, low margin, highly levered, sub cost of capital business trading on c.23x Mar-18 P/E on our estimates, an undeserved 50% premium to the market. The unusually poor reaction from the market to a recent large acquisition suggests to us that cracks in the story are beginning to appear. We think it is best to get out now.
|The market feels like some of the rights issue share are still sloshing around. When they find longer term holders I think the share price can begin its move towards £10. (Just my view.)|
Yes definitely sooner that expected which is good news. Whats interesting is that they have stated that Letica's EBIDA has continued to increase. EBITDA for 12 months ended 31st dec 2016 has increased to $67 million from 12 months ended 30th June 2016 of $57 million. An increase of $10 million in past 6 months. Pretty good. Therefore as they correctly state the multiple paid has reduced from 8.5 to 7.3. However this multiple is expressed in dollars, not pounds, and therefore interesting to see what they actually paid in pounds for letica. My understanding is that around 70% of RPC'S profits are earned in other currencies therefore when converted into pounds, this would have a beneficial effect on profits (due to weak pound 1.22)|
|Good morning Spooner,
Completion announced this morning, 17 days ahead of your hoped for date. That's one of the things I like about this company: under promise and over deliver. They'll be knocking on the FTSE 100 door soon. If they're not in the FTSE 100 by 2020 I'll eat my proverbial.|
|Will be interesting to see if the announce acquisition of letica on 30th March. They previously stated they had agreed a purchase price of $490 million dollars or £391 million pounds. Since then the pound has weakened against the dollar so potentially making acquisition more expensive unless they have hedged|
|Nice start today (+20p), trading at 930p. Back up to Terp?
Underwriters' rump found longer term homes?
Sticking my neck out, 30th march pre-close statement could see a return to 1000p|
|Lol @ from8to800!
There's a strategy that says Buy above the 200 day ma and sell when below.
I hope to accumulate tomorrow.|