Ashtead Share Discussion Threads

[bracke] 06/12/2022 16:06

fenners

"Those that have held for many years know that would be stupid."
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No I didn't miss it.

I wasn't suggesting that investors should become traders, far from it. What I was suggesting is that investors should develop skills that would help them to decide when it was a good time to sell.

Is holding a share to the high and continue to hold it to the low good investing? I think not. I am not saying that investors or traders will buy at the absolute bottom or sell at the absolute top but getting somewhere closeish is better than seeing all the gains disappear.

Viewing the chart below illustrates my point. Buying and continuing to hold whilst the share price rises and then falls a long way back down is not good investing.

EDIT. Apologies I forgot the chart.

[fenners66] 06/12/2022 14:32

good day bracke

But you missed the next bit

"Those that have held for many years know that would be stupid."

Sure some can make trading profitable - but what are the stats ?
90% lose money ?
However buy and hold a good company is the way.

Better would be buy and hold a good company that ignored the instis clamour for trading liquidity and buybacks and got on with building as profitable business as they can , and..... paying a reasonable % of earnings as a dividend.

[bracke] 06/12/2022 14:15

Good day fenners

"the only way to benefit at all is to sell the shares."
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Having followed this share over the years you are correct. It also applies to other companies. To do so means being an active investor but most do not want to be so. Most prefer to put their money into a company and take the dividend. If a company is paying a good rate of dividend I can understand the non active approach but if like AHT it isn't then non active is not a very profitable method.

[fenners66] 06/12/2022 10:37

Now share price is negative on the day

I think that illustrates the point above.

[fenners66] 06/12/2022 09:31

Looking at the share price moves this morning we see just how transitory they are.
+200 down to +60 the share price depends on supply and demand and how markets are performing.
You can make all the profit you like , if the rest of the market is going lower it will take you down with it.

Thus :-

"assuming a PE of 15x that’s 26.25p"

is meaningless as the market can (and will ) change that rating to 12x or 10x on a whim.

Real increased returns to shareholders in the form of dividends cannot be taken away by the market and provide funds for reinvestment - whether diversification or just picking up more as they are cheap....

[fenners66] 06/12/2022 09:13

And therefore the funds invested in bolt on acquisitions and renewed plant , generated 99% or so of the EPS

Not withstanding the buyback added to the debt pile and the increasing debt cost.

Buyback does not come with higher earnings - like bolt ons
it comes with greater financing cost and therefore lower earnings.

Also returns nothing to shareholders - the only way to benefit at all is to sell the shares.

Those that have held for many years know that would be stupid.

[disc0dave45] 06/12/2022 08:55

Looking at the amount of shares repurchased, the BB has generated circa 1.75p of their adjusted eps for the period, assuming a PE of 15x that's 26.25p (just for H1) potential additional return to shareholders, an additional 1%.

[disc0dave45] 06/12/2022 07:39

Excellent numbers.Adj eps 117.9c (2.5% up on what I expected)Particularly nice to read:"We now expect full year results ahead of our previous expectations".....plus ahead of their strategic plan.

[fenners66] 06/12/2022 07:17

To put that interim dividend in context

Last year 12.5c was 8.5 % of the earnings 147.5c
This year 15c is 7.4% of the earnings 202.4c

As said , buybacks do not lead to higher future dividends

[fenners66] 06/12/2022 07:15

On first glance very strong operating results and profit

But despite greater growth in profit and the share buybacks
dividends up by 20% (which sounds a large %) to only
15c a share, whilst earnings rose by 55c a share to 202.4c a share.

In other words despite the "Profit attributable to equity holders
of the Company" they are not actually going to get their hands on it...

Excluding the effect of IFRS 16, net debt at 31 October 2022 was $6,212m (2021: $4,677m),
So all that spending on buybacks adds to debt , instead of paying dividends to actual shareholders.

[perfido] 05/12/2022 18:35

Who is hope, and where did he spring from?

If we get the usual sell off after results, it will probably look like a buying opportunity imho 😊

[disc0dave45] 05/12/2022 17:35

"Hope springs eternal."It does

[bracke] 05/12/2022 15:40

"Supporting Mr Galbraith’s wise words….I’;ve pencilled in 115 cents for Q2 eps :)"
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Hope springs eternal.

[disc0dave45] 05/12/2022 13:27

Supporting Mr Galbraith's wise words....I've pencilled in 115 cents for Q2 eps :)

[disc0dave45] 05/12/2022 13:24

Good day Mr bNo problem with link, goes to show how bad forecasts can be despite their attempt to show mathematical credibility!.Prefer to ignore most macro forecasts.There are two kinds of forecasters: those who don't know, and those who don't know they don't know.– John Kenneth Galbraith

[fenners66] 05/12/2022 10:51

Just applied a little bit of guesswork to work out the potential interim dividend

I think about 17.6c or 14.4p

Still want more , but that's my guess.

[disc0dave45] 05/12/2022 09:52

Thanks perfido Q2 tomorrow so hopefully not it's usual fall on good numbers.

[perfido] 04/12/2022 23:17

Ashtead embodies sharing economy theme, says Liontrust

Liontrust manager Peter Michaelis has added Ashtead (AHT) to his Sustainable Future UK Growth fund this year, as it represents the ‘embodiment of the sharing economy’.

In a report looking at reasons to be optimistic in 2023, the Liontrust manager stated that the group’s business model is ‘the embodiment of the sharing economy’.

‘[It] rents out industrial, commercial, and general equipment across the US, UK, and Canada, thus maximising the utilisation of equipment that would otherwise sit idle for long periods, and offers assurance that equipment is serviced and maintained properly and is reliable,’ he said.

‘In doing so, it allows its customers to concentrate on their core business competencies and to reduce their inventories of capital equipment.’

Shares in Ashtead fell 0.3% to £49.75 on Wednesday, having rallied from a low of under £35 in June.

[perfido] 04/12/2022 11:39

Hi disc0,

Traditionally with these sorts of calculations, you decide on the answer you want first, and then work backwards 😁

[disc0dave45] 04/12/2022 11:11

The following gives detail on how the NFP forecast is determined (I think!).
All very complicated and beyond me, but love the mind blowing formulas, especially when compared to how they allow for forecasting business closures and new businesses (births and deaths), this formula is a lot simpler and has a plus error included!.
In short it’s a best guess estimate that clearly has greater variances (to reality) than those inferred in the methodology, a 31.5% variance suggests some major “tweaks” are required to their inclusion of a fudge factor (“error”).

[disc0dave45] 03/12/2022 13:18

Mr bI know, it was cheeky of me....but the hound told me to say it!.Anyway, after a few hours googling, how the chuff do they determine those NFP forecasts?, anybody?, do they also do lottery numbers I wonder!.Have a good day :)

[bracke] 02/12/2022 18:42

disc0

"“transitory” pmsl."
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That's a low blow. There really was no need for that........

The NFP was 31.5% above expected. As I type the S&P 500 is -0.58% below yesterdays close.

If the NFP had been 31.5% BELOW expected can you imagine what the S&P 500 increase would have been? Certainly some way above -0.58%!

I suspect it will take something very 'nasty' to bring the US Market down before the New Year.

[disc0dave45] 02/12/2022 15:23

Mr bIf it's a true representation of his / the FED's strategy then I suppose why not say it as it is......he's nothing to gain from completely discrediting himself - "transitory" pmsl.

[bracke] 02/12/2022 14:49

Something to consider:

Mr Powell's latest speech was only two days ago. Given that the FED has access to all the relevant data it would be surprising if he were not aware of todays data. Yet he still gave the market what they wanted to hear. Why?