Ashtead Share Discussion Threads

[bracke] 10/5/2021 16:55

Today's intraday high so far is 354.05.

Friday's close was 347.33.

[fenners66] 10/5/2021 16:06

That must be a new high for URI , $352 ?

[perfido] 10/5/2021 15:21

Good afternoon bracke,

Yes, completely agree :-)
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[bracke] 10/5/2021 10:57

Good day perfido

This is one of those rare occasions when we are in total agreement!!

The manager who 'nips problems in the bud' is deemed to have had an easy time, never
having to have had to 'sort out' a problem.

Being cynical, which I am not, just realistic. The manager who wants to impress will contrive to create a problem where none exists so that he can step in and solve it.

The manager who appears to do little but operates an efficient unit is the one to employ.

[perfido] 08/5/2021 17:41

Hi Riley,

I agree but in this case the moral of the story is that often a manager that allows a problem to develop but then wrestles it back from the brink of disaster is more widely acclaimed (wrongly) than another that does not let the problem arise i.e. a deliberate non-catastrophe....
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[riley109] 08/5/2021 09:37

In other word perfido prevention's better than cure.

[perfido] 07/5/2021 20:01

One final thought, something that I first encountered in the field of project management, which might equally apply to investment:

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The most elegant forms of managerial decisions involve problems that never have to be solved because they are prevented from occurring. Oddly there is greater appreciation for a manager who can step in and cope with a problem after it happens, than one who can make it not happen in the first place.

Coping is visible and dramatic. Prevention is thankless because the only testimony to its effectiveness is a non-event.

Even so, the deliberate non-catastrophe is one of the most impressive contributions a manager can make.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Thought provoking? It was for me!
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[bracke] 07/5/2021 18:25

Thank you for your response perfido.

As you post....each to his/her own.

[perfido] 07/5/2021 17:55

Good afternoon bracke,

Great minds think alike, but I believe Buffett beat you to it some years ago :-)

I think some posters may lose sight of the absolute value of their investment's performance, taking into account both the dividend, if any, and the share price appreciation which in AHTs case is phenomenal. In my view this makes the amount of dividend distributions a more minor consideration.

Regarding an investment as a virtual cash dispenser to make up shortfalls in personal income from increasing dividend payments doesn't resonate with me. The overall management of AHT over the period from 1997 when I first invested has been exemplary, and I have no complaints.

I also have a different view as to how to handle the natural life cycle of investments, differing from your suggestion of market timing. Terry Smith is worth reading on this.

My approach is to take profits regularly to manage risk, and recycle the proceeds into mutual funds, which diversifies the danger over multiple investments, offsetting risk at a possible opportunity cost but not as much as you might think.

As always to each his own, but I felt that your post deserved a response.

AHT closed +58, up 1.2% at 4810, another great performance, although volume looks to have tailed off ...

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[bracke] 07/5/2021 16:01

Good day perfido

"but hardly worth bothering with."
===================================

I'm sure you knew I was just 'messing'.

I am in good company. Some weeks ago I posted exactly what Mr Buffett has suggested.
There are some companies that do not pay a dividend but expect investors to sell shares to obtain an income.

There are few shares, if any, that continue to rise forever. Sooner or later for any number of reasons the top will be reached and the decline starts. Knowing when to sell is the difficult part. Hopefully the fall will be a 'waterfall' enabling the holder to exit on the first leg back up. Even if it's thought that the share price will recover better to sell and buyback later.

[perfido] 07/5/2021 15:49

Bracke I beg to differ, but in your case perhaps so.

Have you read Buffett's views on companies which choose to pay a lower sustainable dividend but have soaring stock prices?

Selling a few shares is his recommendation, if as an investor you are desperate for income. And, CGT free if held in an ISA.

Now there's an opinion I respect....

[bracke] 07/5/2021 14:59

"other opinions are available..."
===============================

But hardly worth bothering with.

[perfido] 06/5/2021 20:36

Hi fenners,

You should have seen the first draft, three paragraphs long!

lol!

[perfido] 06/5/2021 20:24

Good evening Riley109,

Thanks for posting your interesting comments earlier today, food for thought

I note that two other posters have responded, but, of course, other opinions are available...

Cheers,

:-)

[bracke] 06/5/2021 16:18

Not quite.

ATH - 341 on 6 April.

URI DAILY

[fenners66] 06/5/2021 16:02

URI up to $338 , new high?

[bracke] 06/5/2021 14:20

fenners

Never would I think that there was any naivety in your comments!

"Meanwhile despite the inequalities we can still negotiate a way through the shark pool to a profit."
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I would add 'hopefully' between still and negotiate. Not always easy and with some nigh on impossible.

[riley109] 06/5/2021 11:43

fenners 66,
No I havn't and yes it was.Pleased that your more than happy with the explanation then!

[fenners66] 06/5/2021 11:37

bracke - there is no naivety in my comments.
What companies should include in their reasons for being in business as opposed to what are included, we know are often 2 different things.

Meanwhile despite the inequalities we can still negotiate a way through the shark pool to a profit.

[bracke] 06/5/2021 11:21

Well said fenners.

But there is a tiny flaw in your argument. Your thinking is based on the premise that companies are run for the benefit of shareholders; they aren't.

Shareholders are required to provide funds for companies to start and operate a business, in return they (hopefully) receive a dividend and if the company is successful an increased share price.

Stock Exchanges are designed to take money from people not to give it to them.

My view may be considered cynical but if you give it some thought you may think there is something in what I say.

[fenners66] 06/5/2021 09:40

Thanks Riley
You have not quoted the source of the comments , but assuming these are from AHT....

So given number 4 comes before number 5 , we theoretically should be receiving an additional £1bn+ in planned dividends !

As for deleveraging leaving the company "at the mercy of financial buyers"

that is outrageous.

It is up to the shareholders to decide when and whom and for how much to sell their shares for.

Not for the company to deliberately add a poison pill of debt to discourage anyone from making a fantastic offer to buy the shares!

That speaks of self interest from the directors looking to preserve their positions rather than looking after shareholders.

Worse the justification that spending £1bn buying the shares will stop an offer materialising for the company... it removes £1bn of the cost of buying the company !

So it counters the inability to load up with more debt.

Essentially if they believe the company is undervalued vs. future potential should a bid every materialise that should be spelled out why , then.

Part of the defence should be , we are a well run company in a cyclical marketplace that have learned to never over-extend debt, we deliver increasing profits and efficiency and have a long record of delivering increasing shareholder dividends, never forgetting that our owners are stakeholders too and need a reward for ownership.

[riley109] 06/5/2021 09:26

This to whom it may concern,



The business naturally supports a certain level of debt because we have a liquid asset on the other side of the balance sheet that can easily be sold. If we delevered then we would be at the mercy of financial buyers (PE) who would look to take out the company and lever it back up again. We are therefore using share buy backs to maintain leverage above the bottom end of our 1.5 to 2.0x range. Our prioritisation in terms of capital allocation remains the same:

1. Same store capex

2. Greenfield openings

3. Bolt-on M&A

4. A progressive dividend rising in line with earnings

5. Share buy backs



So the amount of share buy backs we ultimately do will depend on how much capital we are deploying in the higher priority areas.

[bracke] 05/5/2021 18:18

Good day perfido

"best not to poke the bear, eh?"
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It's ok if he is securely behind bars but he's a wily individual given to picking locks.

"Just a thought, it seems that AHT often has a pattern of two downward falls followed by a reversal recently, interesting to ponder but I wouldn't gamble on it...."
==============================================================================

I have posted previously that the corrections as opposed to retraces are usually 150-250 points. The one from the high was 200. The initial fall to support at 4630 ,retrace up, back to support and todays rise.

My shorts were way to early. I still hold them and am hedging them with indices trades.

[perfido] 05/5/2021 17:01

Good afternoon bracke,

Just returned to find your chart and comments, very interesting thanks.

I note that AHT closed +118, up 2.5% at 4748, but I would be reluctant to give all the credit to the buyback, other posters will simply point out that further buybacks will be even more expensive - best not to poke the bear, eh?

Just a thought, it seems that AHT often has a pattern of two downward falls followed by a reversal recently, interesting to ponder but I wouldn't gamble on it....
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