Anexo Share Discussion Threads

[carcosa] 07/4/2022 12:57

Ahhh, got it. Thanks.

[rivaldo] 07/4/2022 12:15

Arden reiterate today their Buy and 280p target price.

[rivaldo] 07/4/2022 10:34

Carcosa, the number of vehicles on hire at the end of 2020 was 1,613, so the total now of 1,955 is indeed a significant increase year on year.

The same number was 2,023 at 7th September 2021, so evidently the more targeted approach vis-a-vis vehicle funding since then is what they're referring to in terms of the relatively small reduction from September.

[carcosa] 07/4/2022 10:24

Arden (Anexo's paid broker -
hxxps://research.arden-partners.com/portal/portal.html#/home ) has 16.8p for ye 31 Dec 2021 as does Progressive. Cheap on those metrics but when debt adjusted P/E is around 13 or so.


Fleet size; I was a bit perturbed when I read fleet size is reduced. However whilst that is true for YoY there was in actual fact growth of 12% since H1. I hope that will be clarified at a later date i.e. vehicle numbers are now increasing over the medium term.

FY 2021 = 1955
H1 2021 = 1740
FY 2020 = 2097

RNS dated 25 Nov 2021: "Anexo expects the agreement (the MCE Contract) to lead to a significant increase in both the number of vehicles on the road and the number of cases being handled by Bond Turner. The agreement, which is for an initial three-year period, is expected to have a materially positive impact on revenues and to enhance earnings from FY 2022."

So something needs a bit of clarification regarding vehicle numbers


TU RNS dated 7 April 2022 said "...has led to a reduction in the number of vehicles on the road within the Group's credit hire division, EDGE, and the current total stands at 1,955. This represents a significant increase on the same period last year..." TBH I did not understand what the phrase "a significant increase" was related to.

Overall I remain positive.

[rivaldo] 07/4/2022 08:20

Progressive Equity Research have issued an update note this morning.

They forecast 19.2p EPS this year, so almost exactly the same as Finncap, for a P/E of only 7.1.

In summary:

"Confident trading update and increased debt facilities

Following a strong January trading update and forecast upgrades, Anexo has
issued a confident trading statement ahead of its 2021 full-year results
announcement on 11 May."

[rivaldo] 07/4/2022 07:22

Very happy with today's year end trading statement, with trading nicely in line with previously upgraded expectations.

Which means historic 16.8p EPS (up from 11.4p EPS in 2020).

For the current year, Arden forecast 19.3p EPS, so ANX are now on a P/E of just 7.1.

Importantly, cash collections and settlements have improved - and new increased loan facilities and litigation funding has been obtained, showing management's ambition and the confidence of the banks in ANX.

All divisions are trading well and have good growth potential, as outlined above.

Plus there's the kicker of the large VW case settlement receipt coming into view hopefully this year.

All looking good imho:

[rivaldo] 06/4/2022 13:45

Cheers carcosa. This isn't my usual sector for investment, so all info is appreciated. ANX simply looks to be on a very, very cheap valuation.

[carcosa] 06/4/2022 11:04

Other potential positives (?)

Increased used car prices = claim values increase

Disrepair business expanding ahead of expectations.

Better than expected NAV as a result of lower depreciation(?)

+ Dieselgate settlement on the horizon & DBAY takeover attempt again in 2022/3 ?

The only concern from my perspective is the increasing levels of debt; If there are other concerns (regulatory?) then I am unaware of them.

[rivaldo] 06/4/2022 10:46

I've been a bit behind the curve here, and only just had the realisation that ANX's McAms subsidiary covers not just motorcycles for leisure, couriers etc, but also food delivery bikes (Yamaha 125s for example) and scooters.

No wonder this division has been growing so fast given the rise of Deliveroo, Uber Eats, Just Eat etc. Particularly as most of these drivers are such a menace zipping in and out and between cars and must have loads of accidents.

I may have to rethink my price targets upwards :o))

[rivaldo] 30/3/2022 14:24

Cheers carcosa, a good watch. Fingers crossed for a VW settlement this summer which would bring in a very material sum indeed.

On top of which ANX could go after all the other motor manufacturers named in the video.

Meanwhile there should be a run-up in the share price prior to the results on 11th May given the "significantly ahead" update on 18th January.

[carcosa] 30/3/2022 10:06

I do not think this video has been posted here before. It's from Shares Magazine event in February 2022.

hxxps://youtu.be/cd3jr8NhvhE

Anexo Group (ANX) - Nick Dashwood Brown, Head of Investor Relations

Interesting comments re "Dieselgate"

Whilst I am here... I understand that in the UK, car (and motorbikes?) depreciation rates have reduced significantly. Does anyone know if that would result in a significant improvement in NAV? Presumably not, as there would be a depreciation policy in effect.

[rivaldo] 15/3/2022 12:12

With 19.9p EPS forecast for this year, at 130p ANX are now on a current year P/E of just 6.5. Bonkers.

The chart certainly looks set for a bounce from these levels judging by the usual price action.

[rivaldo] 03/3/2022 15:40

ANX were recently tipped in the IC as follows FYI:

"Anexo (ANX)

Aim: Share price: 149p

Market value: £174mn

Website: www.anexo-group.com

Liverpool-based Anexo (ANX) is a provider of a complete litigation claims process focused on the recovery of credit hire and repair costs for the impecunious non-fault motorist involved in a road traffic accident. By offering both credit hire and legal services, Anexo has a competitive advantage over pure credit hire companies (who lack the in-house capacity to litigate a customer’s claim), and solicitors (who lack a vehicle fleet to offer to motorists).

The business has recovered strongly after taking a hit in 2020 when normal working practices for lawyers and law courts were impacted by the Covid-19 pandemic, and the spike in home working subdued road usage. Inevitably, this had effect on the ability of Anexo’s staff to agree settlements with counterparties which subdued cash collection rates.

However, the company is now motoring. A pre-close trading update revealed that both divisions are trading well ahead of previous expectations, buoyed by a sustained recovery in Anexo’s core credit hire division (driven by growth in motorcycle courier market and the withdrawal of rivals from the market), and the reopening of courts, which has enabled faster settlement of claims. In fact, analysts at Panmure Gordon pushed through low double-digit EPS upgrades of 16.7p, 19.9p and 20.6p for the 2021 to 2023 financial years.

Furthermore, those earnings upgrades exclude any contribution from Anexo’s investment in a claim on behalf of 15,000 claimants against German carmaker Volkswagen (VW) in relation to the emissions scandal. It could generate £16mn of operating profit for Anexo, and perhaps sooner than many realise. That's because The High Court in London ruled that VW's attempt to strike out the deceit element of the claims against it to be without merit. VW has already agreed a settlement with those affected by its actions in many other jurisdictions. It’s worth pointing out that Anexo is “investigating the pursuit of similar claims against other manufacturers which have potential to be of significant value to claimants and to the company".

Admittedly, Anexo’s share price has only made modest progress since I highlighted the investment potential despite the hefty earnings upgrades. However, on a 2022 forward PE ratio of 7.4 and underpinned by a near 2 per cent dividend yield, the earnings upgrade cycle is being woefully underrated. Buy."

[rivaldo] 25/2/2022 08:14

Ken Wotton of Gresham House is very keen on ANX per this interview (50.55 minutes in).

Great to hear his view that the VW case could be settled as soon as early this summer - this would be highly material for ANX:

[rivaldo] 08/2/2022 13:52

ANX are presenting on Thursday for free via Shares Mag/AJ Bell:

[rivaldo] 26/1/2022 09:40

Cheers Tole, appreciated. Good to see buying coming in now at the full 150p offer.

[tole] 26/1/2022 07:19

Questor: this stock should prosper from reopening but hold up against any new variantQuestor share tip: Anexo helps drivers involved in accidents so more traffic boosts business, but a low valuation also offers protectionByRuss Mould25 January 2022 • 5:00amAre you bull bullish or bear bearish?Play Fantasy Fund Manager. Win £1,000 every week.Start free trialThis column continues to cast around for companies that could benefit from an end to lockdowns and restrictions and what just might be a return to a degree of normality – all while seeking some protection from falls should a new variant emerge to confound everyone's best-laid plans. Legal services and credit hire for motorists might not seem like an obvious choice but that is one reason why Anexo has the potential to deliver some positive surprises, while its undemanding valuation offers some protection.First researched some 16 months ago, Anexo helps drivers who are involved in car accidents that were not their fault by handling legal claims and replacement vehicles, which are charged to the at-fault drivers' insurers.Business levels dipped in 2020 as lockdowns meant there were fewer drivers on the road, fewer accidents and thus less need for the company's assistance. But a trading update last week said revenues were better than expected and profits would come in "materially higher" than analysts' forecasts for 2021.Moreover, the three positive trends that are driving that improvement should continue in 2022. The number of cars back on the road should continue to recover this year and that is likely to mean more claims from fault-free drivers. Meanwhile a surge in second-hand car prices means claim values are rising and a gradual reopening of the courts is allowing more cases to be heard and settled. Improved case resolution should in turn help cash flow, which has been crimped by higher trade receivables (hence the weak cash conversion).December's announcement of a new service for people who live in substandard housing adds another string to Anexo's bow, while the firm continues to represent some 15,000 claims from Volkswagen drivers in a class action suit over the "dieselgate" emissions scandal. A verdict in favour of the claimants would further boost Anexo's earnings, although analysts are sensibly not including this in their forecasts.Anexo key factsMarket value: £166mTurnover (Dec 2021 estimate): £102mPre-tax profits (Dec 2021 est): £21.9m lossYield (Dec 2021 est): 1pcMost recent year's dividend: 1.5pNet debt (June 2021): £44.4mReturn on capital (Dec 2020): 16.3pcCash conversion ratio (Dec 2020): 9pcp/e ratio (Dec 2021 est): 9.6Even without any success in the VW case, Anexo's shares hardly look expensive on less than 10 times earnings for 2021, a multiple that consensus profit forecasts of a one-fifth increase in earnings per share suggest could fall to barely eight in 2022. Such a tempting price tag may explain why asset manager DBay Advisors, a shareholder with a 29pc stake, tried to buy the whole firm at 150p a share last summer, albeit without success.DBay's holding, coupled with the 38pc stake held by three senior executives, may make the shares less liquid than some and the spread between brokers' buying and selling prices (2pc at the time of writing) could be wider than investors are used to, especially for larger stocks.However, we already have a double-digit percentage paper gain on Anexo and there could be more to come. Hold.Questor says: holdTicker: ANXShare price at close: 143.5p

[hsduk101] 25/1/2022 15:08

With all these target prices. I've never worked out what rough time frame they think that will be hit by.

Personally i've always assumed 6 to 9 months

[gusrezo] 25/1/2022 14:29

you just missed the final sentence:
"I continue to see upside to my 200p fair value target, having included the shares, at 136.9p, in my market beating 2021 Bargain Shares Portfolio."

[rivaldo] 25/1/2022 13:31

:o)) Cheers rimau1, appreciated.

[rivaldo] 25/1/2022 12:04

ANX have also been tipped overnight by Simon Thompson in the IC - though it's another article I can't read!

Here's the opening bit which is free to read:



"Our small-cap stockpicking expert highlights four investment opportunities including two bid targets
January 24, 2022
By Simon Thompson

One of the strongest drivers of share prices is positive earnings momentum.

Liverpool-based Anexo (ANX:146p), a provider of a litigation claims processing focused on the recovery of credit hire and repair costs for impecunious non-fault motorists involved in road traffic accidents, fits the bill. Analysts not only upgraded full-year earnings estimates ahead of the half-year results last September, but a bullish pre-close update has prompted low double-digit earnings per share (EPS) upgrades to 16.7p, 19.9p and 20.6p for the 2021 to 2023 financial years, too.

A sustained recovery in Anexo’s core credit hire division (driven by strong growth in motorcycle courier market and withdrawal of rivals due to Covid), and the reopening of courts (which has enabled faster settlement of claims) means both units are trading well ahead of previous runs rates. The group is also actively engaged with 15,000 claimants who are pursuing claims against German carmaker VW in relation to the emissions scandal. Panmure Gordon estimate these claims could generate £16m of operating profit for Anexo, a sum that’s not embedded in forecasts for the £172m market capitalisation company.

etc"

[rivaldo] 25/1/2022 09:11

Looks like a positive review for ANX in today's Questor column in the Telegraph - subscriber-only though so I can't access:



"The Telegraph

Questor: this stock should prosper from reopening...

Questor share tips: Anexo helps drivers involved in accidents so more traffic boosts business, but a low valuation also offers prote....."

[rivaldo] 21/1/2022 09:37

Here's where you can register for ANX's presentation on 10th February:

[timmythedog] 20/1/2022 16:24

I was sufficiently bothered by that suggestion that I emailed Shares Magazine about it. I got a reply just now which said:
"The editorial decisions on who we write about in the magazine are never influenced by any commercial agreements we have with companies for investor events."
I must say that accepting payment for recommending shares seems to me a very quick way to lose your journalistic integrity - but what do I know?
Shame I can't go to the Shares thing but it's in Edinburgh which is a bit of an ask. If anyone can report back it would be appreciated.

[gusrezo] 20/1/2022 14:23

Anexo was recommended by Shares Magazine sometime ago. Then suddenly they said without any fundamental reason, that it was no longer recommended because the price was sidelines!!. At that time, Anexo was a participant in the webinars from Shares/AJ Bell and "incidentally" Anexo switched to other company for these promotionals events by the time Shares dropped it from its darling list. Now there's again a webinar on 10-feb with Anexo as a participant, and again Shares is bullish about the company... So it's clear that Anexo Group has signed some kind of contract with AJ Bell. That's business, notwithstanding the good fundamentals of the company.