Venture Life Share Discussion Threads

[apad] 31/1/2017 15:05

These are my strategies, and if you don't like them I have others.

No sales of AMS, red. Don't forget that I buy out of income and am pathologically allergic to cash.

apad

[felix99] 31/1/2017 15:04

AMS - don't you find current forecast P/e of 27 (7.4p EPS ) falling to 25 next (EPS 8p ) year a bit steep valuation wise ? Not huge growth in EPS for that rating ?

[redartbmud] 31/1/2017 14:36

Very small nitial position in AMS at £2.0035. Kiss of death for APAD. Watch it tank!

red.

[redartbmud] 31/1/2017 14:28

dacian

I have 2 strategies:

1.Sipp in drawdown - aimed at earning at least as much income/capital gains mix as I draw down each year. I have suspended drawdown for the present as I have become a temporary recipient as the funds pass to HMRC in short order.
2.Isa, Sipp (not in d'dn), and Investment Account. Steady capital appreciation with a balanced income, although I hold non-dividend yielding investments in the Sipp.
I did counteract the lower interest rates on cash by buying Prefs and loan stock at par or below. It is a matter of time before I let some of it go at prices greater than par.
As I will be punitively punished by late Chancellor 'gorgeous' George's loony tune dividend policy, going forward, I am prepared to up my interest and weighting in low paying quality growth stocks. I also feel that being selective will limit the additional risk.

red

[redartbmud] 31/1/2017 12:57

APAD

14 times is compulsive excessive.
Any sales in that period?

red

[hottingup] 31/1/2017 12:51

AudioBoom - BOOM

Key Performance Indicators

1) Unique File Requests: 2015 = 174m, 2016 = 430m

2) Unique Users: 2015 = 29.1m, 2016 = 58.58m

3) Available Advertising Impressions: 2015 = 44m, 2016 = 242m

4) Content Channels: 2015 = 6862, 2016 = 9527

5) Revenues:
2014 = £0.051m, 2015 = £0.192m, 2016 = £1.3m+, 2017 Estimate = £5.3m+

[apad] 31/1/2017 12:44

FreeCashFlow Yield and ROCE are excellent, red.

Never seems to set the world alight. Germany is important.

Good technology.

Bought 14 times since 2011.

1250% growth in ten years. Classic, buy the dip stock.

Yield is poor - they need to do something with that cash, but I prefer caution on the whole.

apad

[redartbmud] 31/1/2017 12:32

APAD

I have started looking at AMS. So far, what is not to like, especially the cash in bank?
Further investigation is warranted.

red

[pj 1] 31/1/2017 12:06

I had 13 years in clothing manufacturing culminating with Coats Viyella. It was a real joy being in womens underwear.

I was made redundant in 1999. At that time piecerate was still the main motivational tool. i.e. you got paid for what you produced, if work was available or not. i.e. soe people came to work for next to nothing until stock deliveries arrived

The programme last night failed to mention just how far the industry has come in 15 years in treating its employees better and arguably much fairer.

Just an observation.

[apad] 31/1/2017 11:33

Alphaville on IG (I still reckon it's the 70k share sale by the non-exec.


IG Group Holdings PLC (IGG:LSE): Last: 525.50, down 21.5 (-3.93%), High: 544.00, Low: 522.00, Volume: 1.30m
11:27 am
PM

What's he saying?
11:27 am
BE

Partly a "tough trading" argument .... Plus a bit of regulatory change stuff that's interesting.
11:27 am
BE

... in the sense that the argument is "we don't bloody know and neither do you: optimism isn't an investment strategy"
11:28 am
BE

(That's me paraphrasing.)
11:28 am
BE

Here's the gist of it.
11:28 am
BE

While our FY17E forecasts are broadly unchanged, we reduce our FY18E/19E EPS forecasts by 20%/12% mainly because we bring revenue/client down again, particularly in the UK (we still, however, forecast client growth, even in the UK). Thus, this remains a risk: should IG experience a contraction in the number of clients, the risk for our forecasts remains to the downside. It is our opinion that IG will be able to offset some of the anticipated revenue decline with cost reductions, and after growing underlying operating expenses by £32MM, or 13%, in FY17, we forecast underlying operating expenses to decrease by 5% in FY18, and then fall another 5% in FY19.

11:28 am
BE

We do not believe that further analysing the pending regulatory change will provide any additional clarity. Unfortunately, this overhang will likely persist as (1) the final regulations are announced (spring 2017), (2) the regulations become effective (likely summer 2017), (3) IG reworks its product offering, and revenue and profits decline (H1/FY18), (4) financial performance stabilisation occurs (H2/FY18 at the earliest), (5) a financial recovery occurs (FY19 at the earliest). In addition, it is likely in our opinion that further adverse regulatory measures will be implemented in some of IG’s other operating geographies.

11:29 am
BE

Price target increased 2% to 510p on higher valuation multiple. We still believe that a discount to IG’s historical forward trading multiple is warranted to reflect impaired earnings visibility and the potential for further adverse regulatory change. However, it is now our opinion that our FY18 forecasts are in the right ballpark (we still have low conviction in our FY19 forecasts), and thus we increase IG’s valuation multiple to 12x from 10x. We believe that a multiple between our previous valuation multiple (10x) and IG’s longer-term forward P/E multiple (15x) is now appropriate. We continue to incorporate surplus capital in our valuation.

11:29 am
BE

The key reason we downgrade IG to Underperform is because our 510p price target is below the current share price, despite assigning IG a valuation multiple 20% higher than our previous multiple. We believe that the current share price has yet to fully reflect the numerous challenges the business will encounter. Our Underperform rating is based upon (i) regulation contagion to other geographies is likely, (ii) client contraction is possible, yet we do not forecast it, (iii) the dividend policy could be maintained, which would result in a dividend cut, and (iv) financial performance stabilisation and recovery could take longer than we envision.

11:29 am
BE

....... all of which looks fair enough.
11:29 am
BE

And needs to be seen, perhaps, in the perspective of IG being one of the better operators in the sector.
11:30 am
PM

Indeed -- still preferable to any of the others
11:31 am
BE

Though I don't know how much of that quality perception's already baked into the price.
11:31 am
PM

To which all these arguments and regulatory contagion apply
11:31 am
BE

.... RBC's valuation works like this.
11:31 am
BE

We utilise a 12x multiple to value IG, to reflect sector derating (which we believe is warranted) following the FCA announcement. In addition, we incorporate IG’s surplus capital in our valuation, utilising our end of FY17 surplus capital estimate of 22p per share. The multiple that we use to value IG is a two-turn valuation premium to the multiple we apply to IG's closest peer (CMC Markets).

11:32 am
BE

(I don't know what a two-turn valuation premium is. Perhaps you can help, ROTR.)
11:32 am
BE

Anyway. Target 510p.

[apad] 31/1/2017 11:16

Controlled, yes, but patient, No, L.
Born of a deep distrust for that treacherous fiat currency, the £.

BVXP spread will never reduce.
I am caught on big spreads with FARN and PTSG (both of which I might like to increase, PTSG certainly), but they are not conviction buys, like BVXP was.
We'll see if Siemens delivers, in due course. I'm presuming that time between tests will be the crucial issue and that sheep antibodies won't deliver positive and negative results, but I am out of my technical comfort zone.

apad

[lauders] 31/1/2017 10:56

I have you all wrong APAD. There was me thinking you were one of the most controlled and patient investors out there! Hmm....

I fail miserably at being patient and on the rare occasion I have been it hasn't worked out to well.

BVXP seems to be gaining some traction. Wonder if there will be further gains post today's presentation mentioned on the dedicated company board? I took too long to top-up there and it is going higher now. Will the spread ever reduce?

[petersinthemarket] 31/1/2017 10:41

Interesting report on Watkin Jones WJG in todays Telegraph. Find it pasted into the WJG thread. A bullish IC report too if you page back a few days. Reliable solid company. Net cash. Long time family run. Increasing divis. HiYield. [Mrs P holds] Current share price 130p is under valued imo. Worth a look. pete

[apad] 31/1/2017 10:26

Increased DOTD. Interim mid Feb.
Should've been more patient, but it isn't in my nature.
apad

[apad] 31/1/2017 09:58

ps
AMS FY in mid March, so unlikely to be any action 'till then.

[apad] 31/1/2017 09:56

What rating do you use, Felix?

Big companies have ever been dangerous, red.
Terry Smith's Accounting for Growth reminds us of the 1980s debacles.

apad

[felix99] 31/1/2017 09:46

AMS I stopped myself out - given its rating it could suffer badly on any nasties which share price is suggesting of late?

[apad] 31/1/2017 09:42

Increased out-of-favour AMS.

Could be worth a look, red.

apad

[redartbmud] 31/1/2017 09:06

APAD

It is quite interesting that your investing philosophy is very much a mirror image of mine, except that I tend to be slower in building up large holdings in conviction buys.
Small caps have tended to play only a minor role in my investment strategy and as such, I have tended to put little effort into research in that area. With the new technology platforms that are now available to us, thee is far more data and research that is available read. It was normal to get a single sheet summary from the broker that was regularly several months out of date.
Even so, the amount and quality of data can be limited and nly a few brokers cover each share.
Whilst the current situation in the world economy persists, I struggle to see strong year on year growth in the majors. On that basis, small caps becomes a more attractive proposition. Their year on year growth can be very strong, when starting from a low base. As a general rule, dividend yield can me a token, so the share price is the outlet for the improvement in performance.
I believe that the chances provided by good quality companies in this sector can offer higher rewards than their larger peers. Indeed, is the quality of management always that much better in the mega caps? - Bp, Bt, Tesco are just three that have demonstrated appallingly bad internal controls and management, on top of the debacle of the major banks. Bby in construction also springs to mind.
From what I have seen, so far, Vanl, as an example, looks like a quality operation that I failed to take heed of and buy on my gut feel, before I had carried out due diligence. It is on my watch list for an appropriate entry point.

Thanks for your comments. Together with those offered by dacian have helped to clarify my thinking for the near term.

red

[apad] 31/1/2017 09:00

We took it in turns to clock-in for each other in the car industry, m.

I remember clocking in for five people on a routine basis.

Other side of the coin.

Dispatches not important, or that interesting.

apad

[madmix] 31/1/2017 08:52

APAD,

I was just about to mention IGG! Down 4%, but we're only back to the level we've been at for the past couple of weeks.

BOO a non-event so far. Looks like a large buyer happy to absorb any PI sells. I don't think Dispatches was a big revelation, most warehouses operate in a similar manner and as usual it's the temporary contract workers who suffer most.

[apad] 31/1/2017 08:51

Increased IGG a little. £5.27.
Non-exec sold shares yesterday. Price marked down today.
Buy the dip.
apad

[apad] 31/1/2017 08:41

PTSG
87p for 1000
no firm quote for 5000.
The joys of illiquid shares!
apad