Alpha Share Discussion Threads

[ihatemms] 17/4/2024 15:34

Main market timetable now provided - 2 May 2024.

[mrscruff] 15/4/2024 15:12

Exponential increases often lead to selling and the formation of a share price peak. However, despite this, no one seems tempted to sell. My intention is to selectively choose the best UK companies to buy and hold, alongside JPMorgan’s US Smaller Company Trust (JUSC). With interest rates pushed out due to the absence of a recession, even the first rate cut appears to be more of a political move. We are likely to remain at higher levels for an extended period, potentially benefiting from strong economies. While there is a longer-term risk of recession, I believe the ‘new normal’ involves sustained higher levels due to inflation. The investment case remains very strong and I hope to buy on substantial pull backs.

[ihatemms] 09/4/2024 12:53

Even though the spread is 19.60-20.00 the quotes are 19.99 to buy and 20.00 to sell ! Talk about institutional desperation to get hold of your shares pre Main market listing. I just keep topping up because we’re still in the foothills of what this is worth especially compared to Wise group (valued at 10 billion )which continues to rise. This still hasn’t reached its ATH yet of £23.
News flow should be continuous from the company now with the Agm and Main market listing timetable to come and then all the new broker notes to follow (not to mention regular sharebacks to make and trackers to buy).
It’s also the last chance to buy the shares (whilst still on AIM) without having to pay the dreaded stamp duty when they’re fully listed.

[wjccghcc] 08/4/2024 11:08

Well they should go into the FTSE 250 so I guess trackers need to buy.

[maddox] 08/4/2024 10:01

At the very least ALPH's move to the Main Market will provide us with a learning opportunity - it doesn't appear to be a frequent event. I can see the logic, and why it should increase demand for the stock - the question is will it move the share price and if so by how much?

Thoughts and experiences - that anyone wishes to share?

[maddox] 03/4/2024 12:45

Confirmation RNS this morning of the intention to move from AIM to the Main Market in early May.

[ali47fish] 31/3/2024 12:32

your last sentence here is the conc- for me the how and why doesnt matter- you sound better than me at analysing- i am equally positive about it and wish to add before they move to the primary index

[mrscruff] 31/3/2024 10:38

AllyFish no need to be sorry as this view is backed up by years of theory by John Bogle and the rise of passive investing and EMH. To outperform an index is rare and we have to look deeper from the bottom up and top down yet take on risk. There are more knowledgeable posters than me here on the bottom up analysis, I am more experienced and have data on top down macro and also behavioural science. I also look out for what fund managers have been selling and does it tally with the data as that data can and has changed since the selling stopped. I think ALPH was sold down to front run more aggressive rate cuts that are now expected to result in a new normal rate of interest. ALPH is uniquely positioned to benefit from this new narrative alongside the main market one.

[ali47fish] 30/3/2024 17:21

that then begs the question of the worth of what you are stating sorry?

[mrscruff] 30/3/2024 16:22

Alifish, If we all knew what to look for then investing would be a zero sums game.

[ali47fish] 30/3/2024 12:13

philly and mr s this is too complex to understand -can't you give a briefer gist of what we investors nee to pay attention to

[mrscruff] 30/3/2024 10:11

The share scheme seemed over generous and the conditions fairly challenging for regular PI's to understand and buy into. It certainly put me off and I note others in other forums I read but not participate in. Perhaps we should not be invested if we don't fully understand everything but what we do understand is compelling and I happy with the gains made.

On another point I have been buying when JPMorgan trusts had been selling as I understood why they had been selling ahead of falling rates. So I simply bought thinking ahead of them. They stopped selling and buybacks started so I don't believe the buybacks had much to do with the gains.

[philly cheesesteak] 29/3/2024 13:27

How have the buybacks been a headwind? They announced them when shares were trading at £14.80!

Also, just to note that the 2 most recent share scheme from 2022 have the below conditions;

"The gain that an F shareholder could receive is capped through placing a ceiling on the maximum market capitalisation of Alpha of £1,867m. The result of doing so is that the F Shares will be entitled to a pro rata share of the gain in market capitalisation of Alpha between £740m and the market capitalisation ceiling of £1,867m."

"The rate of conversion that the G and H Shares will be regarded as worth, is a pro rata share of the market capitalisation gain of Alpha above a hurdle price of £740m. The gain that a shareholder could receive is capped through placing a ceiling on the maximum market capitalisation of Alpha of £1,867m. The result of doing so is that the G and H Shares will be entitled to a pro rata share of the gain in market capitalisation of Alpha between £740m and the market capitalisation ceiling of £1,867m."

So they don't benefit at all unless the share price is above around £17.20, capped at £43.40. So they is a clear desire to get the share price significantly above current levels

[mrscruff] 29/3/2024 10:34

The results state "Working towards a listing on the Premium Segment of the Main Market in May 2024". This implies May and exact date could be a strong RNS for us. All seems rather soon and without fanfare as this is a stock that has zero investor engagement for now :-)

Hopefully they have collected enough stock for employees before then as the buybacks are not benefiting existing share holders and has been an headwind allowing us to participate in buying cheap stocks this year.

[ihatemms] 27/3/2024 12:25

With the AGM on the 1st May and the full FTSE listing planned for May surely we must be close to getting a timetable for the transfer from AIM to full market listing ? Then with a lot more brokers poring all over the figures that’s when more international interest should perk up (as well as the trackers)

[maddox] 25/3/2024 09:36

Thanks Mr scruff. Whilst it's highly commendable that ALPH Mgt wish to be measured by underlying performance - this presentation of the figures significantly distorts reality. At period end 23% of the Mkt Cap was accounted for by cash, and on a cash basis ALPH are on a p/e of 9.

ALPH basic eps 206.2p was x3 the Brokers consensus forecast for FY23 (68p)!

So looking to the Brokers consensus eps forecast FY24 of 78p and FY25 90p suggesting that we're currently trading on a forward p/e of 23 for FY24 whereas, my estimates put ALPH on a forward p/e of 8.5.

There is thus huge value hidden in ALPH - the figures are there do the math!

Regards Maddox

[mrscruff] 23/3/2024 14:22

Excellent summery Maddox. I don't think they are allowed to speculate over the future neutral rate of interest but we we can all speculate towards the market who are hinting that this will be around 3.2% since the end of last year and a pick up in business at the same time will be a new way to frame this investment.

[maddox] 22/3/2024 00:12

It's like ALPH are embarrassed by the interest they are earning, the Profit before tax at £115.9m is greater than their reported revenue £110.4m?!?

So you could present these results....

ALPH's business model provides a natural hedge such that when the economic environment dampens fee income, higher interest rates drive interest income; boosting profits and cash generation.

Group total income rose 73% with FX Risk Management revenue up 10% to £76.3m, Alternative Banking up 18% to £33.9m but primarily driven by Interest Income up 685% to £73m. Accordingly, reported Profit before tax increased 148% to £115.9m and Basic EPS was up 124% to 206.2p. Net cash increased by £64m up 56% to £178.8m (2022: £114.4m).

Whilst this windfall will clearly reduce with the interest rate cycle it will have generated significant cash to enhance the business. Also, it is unlikely that we'll see a return to super-low interest rates and with cash balances growing along with client numbers - it'll continue to be a significant part of the income mix going forward.

So, IMHO having a highly resilient business model that can see you comfortably through a down-turn is a very attractive characteristic.

[sailorsam1] 20/3/2024 20:35

Adj cash figure is the key here

[kalai1] 20/3/2024 16:22

Alpha Group International plc posted FY 23 results this morning. Group revenue increased 12% to £110.4m with FX Risk Management revenue up 10% to £76.3m while Alternative Banking revenue was up 18% to £33.9m. Interest on client balances grew to over £73m from £9.3m due to the higher interest rate environment. Underlying profit before tax grew 11% to £43.0m while reported Profit before tax increased 148% to £115.9m accordingly. Reported basic EPS was up 124% to 206.2p. A Final dividend of 12.3 pence per share was proposed making the total final dividend for FY23 16p. A SBB of up to £20m was also initiated in January. The balance sheet remains very strong, debt free with adjusted net cash increasing by £64m to £178.8m. Valuation remains unhelpful with forward PE at 23.6x and PS ratio at 6.55x bottom and 3rd quartile respectively. Share price also lacks positive momentum and is in its 3rd consecutive year of sideways range trading. That being said the share is low in range and moving up on today’s release, and it could generate some short-term upside even while remaining range bound. The share is also well worth knowing about for the longer run. BUY....

...from WealthOracle

[mrscruff] 20/3/2024 10:39

Nothing unexpected other than the announcement that they are targeting main listing for May and the new board appointment continues to add age and experience above Morgan Tillbrook age who is very young and may put of investors. Fully understand what Morgan has done but as the company grows a move away from key people is critical to growth.

I can see private equity buying out ALPH and automating everything. The staff will own shares and will be suitably compensated.

[mrscruff] 19/3/2024 12:45

Results tomorrow. We are already near 1-year lows and many here will need a a poor result to buy more cheaper given the long-term goldilox for Alpha Group of stronger economy and possibly a higher nominal rate than the past 20 years. I am 50% accumulated here buying on the dips.

[mrscruff] 15/3/2024 11:20

Yes advanced warning will be given. Don't forget results next week so full listing news could be bundled with that? I have bought in and hope it actually falls or ideally stays flat by the end of the year meaning that while my Alpha holdings will be down or showing little profit, my overall portfolio will rise as rates get cut. If Alpha smashes the lights out by the end of the year due to higher rates (not my base case) my overall portfolio is likely to be down but I then have something to sell for deferred recovery. So it's a bit of an leveraged hedge over a money market fund in the less ulikley event of higher rates. If anyone knows other ways then let us know but keeping away from recession risk.

[ali47fish] 15/3/2024 09:22

will a date be given in advance- i am seeking a lower entry