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Vertu Motors Share Discussion Threads
Showing 1226 to 1249 of 1250 messages
|Pole, if you are seriously asking the question rather than expressing
incredulity, the market is attempting to factor in a potentially tougher 17/18.
It looks a very aggressive sector de-rating to me, however it may be correct,
the outlook should be clearer within a few months.
Look and Inch are both on my watch list, no direct sector holdings atm.|
|Just the sector getting a pounding because Little ol' Britain voted to leave the dis-United States of Europe. Great buying opportunity imo.|
|Ok, what's going on! Good news is suppose to make the shares go up not down, can anyone put light on this? It all seems bonkers to me when the company looks great on paper.|
|66.4p hardly looks like much of a discounted share placing now!
And according to Edison they have £134m banking facilities in place with £40m dedicated to 'opportunities'.|
|The problem with VTU is the discounted share placings whenever they need cash to add to their dealer portfolio. Its proved an excellent method for shareholder value destruction.
What proof is there that they won't repeat this lunacy?
|That's a substantial trade, oiks!|
|Thanks for posting the Edison note. Particularly like this bit:
"The ratings of the main five quoted UK motor dealership groups cover a very narrow range and at a substantial discount to that of the FTSE All-Share General Retailers Index (CY16e: 6.9x vs 13.3x). We believe that this discount does not reflect the defensive characteristics of the sector. Vertu, with its latent profit potential emanating from recent investment, looks particularly attractive".|
|Edison have a new note out singing the virtues of Vertu but I think we know them. It's what isn't known that's doing the damage.
|I thought it was one a few points higher.
L/t surely anywhere around this level should be ok, but Robbie is a trader doesn't like seeing his money go backwards. Nor do I but timing isn't so easy or we'd all be doing it.|
|Looks like a Warren Buffet moment then.|
|Robbie Burns sold out of the motor sector last week saying looks cheap but sentiment is shot and no point fighting the market. He might have a point. Timing!
|The whole sector looks good value at the mo, imo. Sterling is weighing I guess. ...|
|Should be about 46p then based on 6 months 'Earnings per share of 3.87p (2015 H1 : 3.82p).|
|Lookers now selling under 7X forward earnings, so 6X may be around the
multiple the market is willing to pay atm.
INCH will usually sell on a higher rating as it's a multi continent distributor
|Not yet hopefully . Looking from the sidelines|
|I thought it was already there.|
|Heading towards bargain territory imo|
|On the new car front, I like this strategy of adding premium brands to the mix. It's rarely the wealthy who suffer during unstable financial times and we've seen in other sectors that premium products remain very much in demand.|
|Agreed - and not only the narrative - the figures backed up that assertion with the majority of the margin from these activities|
|I don't think the markets & financial institutions "get" the motor retail sector.
They look at the massive revenues & low % profits compared to other sectors, and see high risk and always seem to assume negative effect of macroeconomic issues.
I actually believe the levelling off, or slight fall, in the new car market will be better for the share price As that happens, turnover will stop rising and the heightened effect of the increasing income and profit from the Aftersales business will be more evident.
It was very noticeable that VTU prioritised focus on Aftersales in their narrative with the interims on Tuesday. Rightly so, with the massive vehicle parc created by years of increasing sales.|
|What is the opposite of defying gravity?
What more can they possibly do to convince a sceptical market?
|Thanks jambo, here's an unlocked version of the Zeus one, think they're all fairly positive:-
Vertu Motors PLC (LON:VTU) has reported another record performance for H1 2017 with adjusted EPS +4% ahead of our expectations. We are maintaining our FY forecasts despite softer new car sales, as we have confidence in its aftersales and used car business accounting for 72% of gross profit. The shares and indeed the sector look oversold to us, and while there could be modest earnings downside in 2017, we believe more significant EPS risk has been factored in.
H1 results: Vertu has again delivered record results for the 6 months ended 31 August, beating our expectations at the adjusted-EPS level by 4%. Revenues were 1% below our forecast albeit +18% YOY with acquisitions in the period accounting for £67.3m of the growth (5% of total). Adjusted EBIT was bang in line with our forecast and was +18% YOY with margins flat YOY at 1.4%. Interest costs were £0.5m lower than our forecast but £0.7m ahead YOY reflecting new vehicle stocking charges due to more premium sales outlets and higher new car stock levels during the period. Cash conversion (operating cash flow as a % of operating profit) was 133% vs. 222% last year. The dividend was in line and +11% YOY and is currently yielding 3% at current levels.
Key performance drivers: The performance in used cars was particularly pleasing, with aftersales also showing solid progress. Acquisitions made in 2017 made an early positive contribution, which is unusual given timing (lack of March trading) and reflects the quality of the premium businesses acquired. The acquisitions made in 2016 made a solid contribution, which again validates the success of the strategy in our view. New cars were modestly down YOY albeit this reflects a falling trend in private new car registrations since April 2016.
Forecasts: We are maintaining our headline forecasts on the back of these results and management’s near term guidance. The implied H2 PBT of £12.0m compares to £10.4m delivered last year, with a strong September performance already delivered. We are also encouraged by the ongoing strength of the servicing business, where we anticipate further progress during the coming months as the UK car parc continues to expand.
Investment view: Looking at various valuation techniques comprising measures through the cycle, we arrive at a value of 79p, which implies significant upside from current levels (71%). We assume a black cloud scenario of 6x 2017E EPS (37p per share), albeit this would be at a discount to the current freehold/long leasehold valuation of 43p per share (60p on a net assets basis). While conditions in the new car market may well get more difficult from here, we believe Vertu has put in solid foundations that will allow it to prosper through the cycle|
|Three broker updates this morning...
N+1 Singer: Https://www.research-tree.com/companies/uk/specialist-retail/vertu-motors-plc/research/n-1-singer-vertu-motors-positive-trading-in-h1-and-sept-and-outlook-for-a-s-and-used/CC07_5_1
And Liberum: Https://www.research-tree.com/companies/uk/specialist-retail/vertu-motors-plc|
|The entire market cap looks to be covered by net tangible assets!
Even with the uncertainty with sterling and continued new car sales weakness, this segment only contributes 21.7% of overall gross profit i.e. a big chunk of business would hold up well in any downturn.
With no huge interest rate spike expected, folk are going to continue to lap up attractive deals imo. Capex is expected to drop off substantially too generating much greater free cash flow.
Someone should come in and bid at this valuation. I'm sure there was a note out recently citing VTU as an acquistion target.
Mr Market is being incredibly pessimistic here imo - getting alot for your money!
I'm a buyer