Abacus Share Discussion Threads

[dumbarton2] 20/3/2008 11:33

Im here guys ...lol

Down again you spoke too soon.

[mesquida] 19/3/2008 16:45

Perhaps he is busy looking at PREMIER FARNELL´s statement!

[philjeans] 19/3/2008 09:43

Bottomed I suspect; interest rate cuts in US will now be mirrored around the globe - more particularly in EU and UK.

This will avoid recession and stocks like ABU will rocket as market begins to realise this silly price.

[dumbarton2] 18/3/2008 11:16

Down yet again.

[dumbarton2] 17/3/2008 16:01

Another new low and co that has high debt will get hammered.

[philjeans] 14/3/2008 16:20

Offering fantastic recovery potential here and an unbelievable yield. All going well with this superb business. Being sold down by nervous nellies.

[dumbarton2] 14/3/2008 14:53

Any company with high debt is being battered. Avoid.

[mt67] 11/3/2008 18:44

Those earnings forecasts will be having a haircut shortly, a very very short one, perhaps a number one. Current holders now all having number twos but not the haircut variety!

[mt67] 11/3/2008 18:30

Trading update e/o March due, trading softening i expect or at least the market is anticipating/guessing this. ABU is highly operationally geared, any drop off in sales falls to the bottom line so if a recession hits UK/European markets profits will be savaged, divvy slashed. With all that debt there is more than likely bank cov's stipulating certain level of profitability/interest cover required. Wouldn't like to hazard a guess what these cov's might be but if profits fell, funds may be required to shore up the balance sheet ie rights issue/d4e which would be highly dilutive.

Maybe just scaremongering but if Europe sinks into recession ABU may go the same way as Eurodis Electron!

If however you believe all is rosy in the garden and that subprime is all a figment of the markets imagination which will not cause a recession in Europe you might aswell bury your head in the sand.

I expect 25-35p in the not to distant future!

SELL SELL SELL

[bletherer] 11/3/2008 16:53

To state the obvious, the yield is not safe, as ABU's indebtedness means it does not have any padding if recession wipes out their profits. That said my impression is that management is keen to maintain the dividend if it possibly can, so we'll have to see how it goes in the next few quarters. My wild guess is there's something like a 40% chance that ABU retains the dividend as is or close to it, a 50% chance that the dividend is abandoned or significantly cut in the short term but that long-term the company survives and returns to profitability and dividend payments in the next cyclical upturn, and a 10% chance she goes belly-up.

[barn owl] 11/3/2008 16:22

Last AGM statement came over has being positive, but that 16.5% yield is scary!
Good luck all.

[jhan66] 11/3/2008 16:17

16.5% yield ! something's got to give

[barn owl] 11/3/2008 16:14

Blimey, the market says going bust or end of the world! Watching from the side lines only for now. Falling knives apart, might be worth a long-term high risk punt at some point in time.
Good luck brave punters!

[bletherer] 11/3/2008 15:45

An additional problem is that technically, once it broke below the previous all-time-low at around 80p, this share simply has no natural floor. It will take a run of good news and/or a general improvement of sentiment in the sector/broader market before this bounces, and in the meantime it could more or less go anywhere. A dividend yield in excess of 15% might generally be expected to attract some buyers, but there's just too much fear out there about where the economy's headed to make people jump in on cyclical stocks.

[bletherer] 11/3/2008 15:38

The last set of results and the AGM statement don't really justify this sort of price action, but the market just doesn't want to know about companies with significant debt with tight credit markets and worries about recession. I'm holding on to what I've got but not wanting to add to my exposure as I've lost enough already on this one and I think there is a risk that they could run into serious trouble in the next 12 months, depending on how bad the economic situation gets in Europe. If they're still up and running a year from now though I think the share price will be up way above current levels. It's what I would call a high-risk, high-reward play at present.

[philjeans] 22/2/2008 13:35

Throwing off cash like confetti - easily enough to cover three times this debt( which is going down fast and regularly) AND pay an increasingly higher dividend!

Some of my best clients have been overtrading and been overborrowed for thirty years - it's the way they have expanded and made millions.

[dumbarton2] 22/2/2008 10:15

PFL and ecm are in the same boat avoid.

[erwinus01] 22/2/2008 09:11

Debt is really to high, typical result of old fashioned dividend policy in the UK. We have seen some examples here. Really depending now on marketgrowth which is very unpreditable, and high debt is not the thing you want these days.
As the UK their main marktet is still an Island in terms of higher pricing for components than the rest of europe they will be struggling to protect their good margins the coming years.

[rabbrooks] 21/2/2008 15:41

Apart from one director the shareholdings of the rest are nominal. There does not seem to be a commitment of capital by them. The share options are of more interest to them than dividends from their holdings unfortunately.

[philjeans] 21/2/2008 11:48

Interest costs well covered and falling.

Bargain!

[dumbarton2] 20/2/2008 15:26

Debt too high.

[philjeans] 19/2/2008 12:14

Really very good value down here at less than one seventh of their value a few years back!

High yielding; ISA ble; debt being paid down and a good solid business having gone through the merger pains last year.

Big buyers still accumulating, as am I.