Aa Share Discussion Threads

[nigelpm] 22/2/2018 15:49

Thanks for posting Jonwig. There is an error in the article though as there are ~610 million shares in issue in total and Mr Woodford does not own all of them (yet)

Depends how you read it.

You could make the assumption that the 610m refers to "the group" - which is clearly what they mean.

Slightly sloppy reporting though for sure.

[vanadiumx] 22/2/2018 15:46

Thanks for posting Jonwig. There is an error in the article though as there are ~610 million shares in issue in total and Mr Woodford does not own all of them (yet)

[jonwig] 22/2/2018 15:17

A bull signal? Or ...?

Neil Woodford has bought more shares in the AA, the day after the breakdown cover group saw its stock price slide 30 per cent following a cut to the dividend and a profit downgrade to fund more technology investment.

Mr Woodford, the company’s largest shareholder, increased his holding in the group from 14.21 per cent to 15.03 per cent, with a total of 610,807,568 shares, according to a filing from the AA on Thursday.

The business floated in 2014 at a share price of 250p, but the stock has since lost two-thirds of its value, partly due to the sudden departure of its former executive chairman following an altercation, but also because of concerns over its business model.

On Wednesday the company slashed the dividend from 9p to 2p and said profits would fall 13 per cent this year as it invests in telematics technology and growing its insurance business.

Shares fell 30 per cent to 82p, though on Thursday had regained 6 per cent to 88.6p.

Mr Woodford declined to comment when contacted by the FT before the share-buying announcement.

(about 2:45 today.)

[spob] 22/2/2018 14:57

I wouldn't be surprised if the battery just needed a proper recharge

the output of a battery reduces significantly in very cold weather

especially if doing lots of short journeys with the headlights, wipers and the radio all going at the same time

[nigelpm] 22/2/2018 14:39

I was always told providing you can handle the
debt repayments, debt is good if there is inflation,
we have inflation, that is why the banks are raising rates,
dyor.

Debt can be helpful in reducing the tax burden - but that's where it ends for me.

[srpactive] 22/2/2018 14:35

I was always told providing you can handle the
debt repayments, debt is good if there is inflation,
we have inflation, that is why the banks are raising rates,
dyor.

[nigelpm] 22/2/2018 14:29

He certainly has. I was one of his major admirers. However, of late he seems to have got stuck in a bit of a rut - one major lesson is you ignore debt at your cost.

He seems IMHO to have forgotten that and it has bitten him badly.

[srpactive] 22/2/2018 14:03

N

You obviously have your view, but Mr. Woodford has achieved
an awful lot in this industry in his career. Not many can
say they have done better than him, maybe you have.
I was told when very young only critise someone if you can
do better.

I was buying a few early yesterday as I did not expect it
to fall so decided to accumulate, dyor.

By the way I do not have any money in any fund.

[nigelpm] 22/2/2018 12:51

Woodford buying - one of the better sell signs of late.

What on earth would possess you to buy based on the RNS yesterday?

[tsmith2] 22/2/2018 12:48

II picking up...cheap for back to private

[badger60] 22/2/2018 09:44

I dunno. If the dividend is going to be pegged at 2p pa, what yield, given the risk profile here, would you consider is fair value?

[cryptotrade] 22/2/2018 09:37

58p seems too low

[minerve] 22/2/2018 09:28

I think Car Genie is interesting and could lead to new business avenues but at the moment we don't know for sure and therefore should be already discounted. AA have acknowledged this and not accounted for any upside, only costs, from this development.

What is important is whether the business can grow insurance and whether it can interest the younger drivers who may have little affinity with the AA.

If it can acheive the above and get back to delivering healthy FCFE then you have a company with a good/stable dividend implenting a debt for equity swap that steadily will grow your valuation over time.

This is a utility with little political interference. I think it is worth considering even though debt is high.

By-the-way, PIMCO, the largest bond trader in the world, have stated that US treasury yields may have already peaked for the forseeable future. I agree, I think inflation story is by no means certain to happen and with globalisation and commodity oversupply I think the inflation story is actually getting ahead of itself. Of course, here in the UK, we have the pound and Brexit to watch but I think AAs debt will be attractive to many when it comes up for renewal and AA will be able to afford the new replacement debt.

[tsmith2] 22/2/2018 09:24

Intra day movement suggests big move up today

[badger60] 22/2/2018 08:32

A nice little pump and dump.....and it wouldn't surprise me if the share price is below 80p at close of play.

[srpactive] 22/2/2018 08:09

I think the share price will have to retest the low 81pish
of yesterday before moving on, I would have thought, dyor.

[kamitora] 22/2/2018 07:29

AA Plc : Jefferies cuts target price to 58.00p from 125.00p; underperform

Re the comment about cars becoming more complex leading to more breakdowns. (1) fewer parts in electric cars means increased reliability (2) autonomous cars fundamentally change the market - why buy an expensive asset that is not utilised for 90% of its time (there are some stats on this I don't have to hand) - likely society will largely move to a model where you call a car when you need it because its individually cheaper and macroeconomically more efficient therefore likely incentivised at the macro level over time (less road building, lower pollution etc. unless you see the car economy as a Keynesian stimulus mechanism)



Also - general investing/trading point - beware value traps. High (not properly covered) yields, low P/Es - attractive headline profits - can serve to deceive, always look for the liabilities - the debt, the pension deficit, etc. Even further hidden - do yourself a favour by running your own PESTLE analysis (or similar) on your investment/trade - looking for macroeconomic factors etc. and operational risks - single suppliers, etc.

No position here.

[spob] 22/2/2018 07:28

" On top of the £2.7bn debt there is a sizable black hole pension defecit. "

yes, which is why I take little notice of the term "Net Debt" which does not show the full picture for any company

better to look at Current assets minus Total Liabilities


for this company that is Minus 3.34 BILLION POUNDS


you can try to help people but some always know better

[badger60] 22/2/2018 02:51

In amongst all the sound bite and rhetoric in the update, I can't see how this forward breakdown prediction service is going to work, or be of any use......or indeed be cash generative. If the AA can predict when you vehicle is going to break down, (or even maybe when you are going to have an accident?), they must be more informed than the vehicle manufacturers..........which is, of course, complete bo##ocks........

[badger60] 22/2/2018 02:13

www.employeebenefits.co.uk/issues/june-online-2017/aa-move-db-pension-scheme-members-final-salary-care-arrangement

On top of the £2.7bn debt there is a sizable black hole pension defecit. At best, imo, this company can only limp along for the next 20+ years as the stated intended remedial changes will take time and may not be effective.

[rethemagic] 22/2/2018 01:07

Snape,in answer to your question the debts of Saga were loaded onto
the AA so they could get the float on Saga away.