It's a V shaped bowl Zho! |
Not the best place to be short these last few days. |
Well spotted. Up from 0.51% to 0.69% on Thursday. |
I see GLG increased their short. One reason for the weakness |
Share price 592p this morning +10%.
Well done to anyone who bought sub 550p the last few days. |
Well that's the 550p level I noted last week - time to buy a few. Quite a drop - down almost 40% since end of July, although to be fair it was overvalued then. Looks decent value now. |
Could be close now... |
Well just made
My first buy, hoping bottom is in. In retrospect it obviously wasn’t. |
has some of the selling been in response to fears of CGT increasing in those who have a decent profit? |
Yes, agree your (good) summary of the state of affairs.
Cheers. |
I didn't catch the whole presentation but listened to the start of the Q&A when they broad brushed a lot of retail questions.
I think I heard the CFO say that they didn't buy ACE for it's gross margin, but rather for the TAM increase, and that if they wanted to focus on gross margins then they would have stayed as a pure play rental business.
The market certainly didn't react like that was the case when the deal was announced & was described as 'materially earnings enhancing in FY24 and beyond'. Usually when a business moves away from a pure play then it derates as the additional complexity makes it less attractive.
Certainly if you dilute your margins, increase you CAPEX & take on a significant amount of debt then re-rating from the 480p level pre acquisition to 890p post doesn't make a great deal of sense.
So far shares have de-rated back to 590p, however I'm not convinced they are finished yet. |
I think part of the problem here is they don't provide any broker notes to private investors (eg on Research Tree) and that in turn leads to all this misunderstanding over expectations. Most small caps now have some research so they really need to address this. |
Pre-submitted questions not answered so took CFO up on her two comments:
She said ACE "came with lower margins" .... "we make no excuses".
She answered: "ACE is a service business, not rental and comes with lower margins".
She followed-up by saying ACE "has made a profit" and "... delivered on our expectations".
CEO later said "we guided that margins would be lower". And further that maybe this was not properly communicated or the market misunderstood this communication.
OK, I didn't see that...guidance... did anyone see that?
[Note: no clarity in the CFO's comments on what the "delivered expectations" were!].
Personally, as a business strategic issue, I would have thought than a business with Service Differentiation would attract a higher margin than straight rental. Sure there are added costs for service provision but this should be more than compensated for by the differentiation.
I'm confused. |
Few questions submitted for 10:30:
i) about whether ACE, as a unit, contributed a profit or a loss to the group in H1;
ii) whether or not it was a profit or loss, when do they see it improving or becoming as profitable as the other segemnts; and
iii) will they report segmental analysis by business unit in future instead of just regional data given ACE is a substantial revenue contributor now. |
Yes it came back on to my radar after recent fall - was a bit too richly priced for my liking but getting closer to fair value now in my view. |
Keeping an eye on this now - would be looking to buy some if it drops to 550p - this would put it on a PE of around 15. Not quite in bargain territory yet. |
September effect everything sinks in September |
I'm guessing that the continued weakness is due to earnings estimates having been trimmed for this year and next, a little surprising given that the Company said that their expectations remain unchanged. |
I see what you did there! |
This is sinking |
Since January '24, after the December ACE Winches' price break-out the Volatility on this share has been 40% in magnitude over 4 legs of 2 cycles.
The AIM market has been really "risky" for drawdowns this year. A gift for traders and that's maybe what the market is.
Nevertheless, that is very poor guesswork for a market estimating value of a business. |
Ashtead Technology deserves rerating
Ashtead Technology is in ‘great shape’ and the shares deserve to re-rate, says Peel Hunt.
Analyst Andrew Nussey retained his ‘buy’ recommendation and target price of 825p on the subsea equipment rental group . a strong first-half performance, with pre-tax profit rising 39% to £19.6m and organic revenue growth of 16%.
Nussey said the group delivered a ‘confident outlook with growth in capex, high tendering, buoyant customer backlogs, and strong operating metrics’.
However, the group failed to make any changes to its estimates, which Nussey said were ‘well underpinned’.
‘Ashtead Technology appears in great shape as management continues to execute strongly across the structurally attractive global market,’ said Nussey.
‘The shares have eased off recent highs, but reassurance on progress [in the half year report] justifies rerating.’ |
Big vol again today! |
Deutsche Bank raises Ashtead Technology to 'buy' (hold) - price target 860 (835) pence (Morning Star) |
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