Babcock Share Discussion Threads

[farrugia] 18/1/2021 15:19

I think market cap is 1.05 billion? I think Serco or some other predator could make another bid for it at these levels.

[netcurtains] 18/1/2021 15:08

So what we need to know are what are their "BIG" obvious assets? What do they own that generates income?
They clearly own a lot as they make a lot of money (in normal years).
So one wonders what it is?

Market Cap is now about £900m so this is actually getting silly....

[minerve 2] 18/1/2021 15:04

I don't try to crystal ball the future but I don't see why a capital raise is required here.

[sooty snipes] 18/1/2021 15:03

So has this company already had a rights issue or are you just supposing it has one? I'm thinking of dipping my toe in but this company reminds me of Centrica.

[netcurtains] 18/1/2021 14:15

pepe: I understand your dilution worry - but in fact you're swapping shares for cash so in fact, in a sense the equation is balanced out. The company is worth more after the issue as its current assets increase.
So , "if" things work out well, a rights issue often is to the benefit of the shareholder. It depends.

However BABs share price not falling due to debts its falling because the value of "assets" is unknown at present.
Thus one assumes this is a buying opportunity.
But I am open to other views.

[ekinvestor] 18/1/2021 14:15

"In other wirds, things can surely only get better from here."

We can certainly hope..

[archy147] 18/1/2021 14:12

Well I obviously made a mistake buying in here when i thought it was undervalued at c£3. BAB is now comfortably the biggest loser in my portfolio :(

However, whatever troubles they face, the share price is now at its lowest level for....wait for it....15 years.

Ie its lower now than during the worst of the covid crunch AND worse than at the nadir of the financial crises in 2008.

In other wirds, things can surely only get better from here.

[pepepepe73] 18/1/2021 14:04

Yeah but the lower the stock price the bigger the massive dilution to pile cash.

What’s clear is this uncertainty is gonna hurt the stock price for several months from now and on

[netcurtains] 18/1/2021 13:30

pepe: I'm the reverse: I think a share issue (like Rolls Royce) would be a nice bonus. Shareholders would get extra cheap shares and BABs balance sheet would improve with a pile of extra cash.
Its WIN WIN.

[pepepepe73] 18/1/2021 13:27

Thanks @net.

I find BAB very cheap but the threat of a massive share issue is a very black cloud that makes me be very cautious right now. Otherwise I would be buying as crazy.

What's your standpoint about the capital needs that new management could be outlining?

[netcurtains] 18/1/2021 13:12

Looks like a 120k buy just gone through.

pepe: Wall Street Journal gives good balance sheets:

[minerve 2] 18/1/2021 10:45

Anyway, those following Minerve will remember he posted saying he would sit on the sidelines for a while - and provided the rationale - many months back.

[maverick081267] 18/1/2021 10:38

How many you get in here net did you have a small nibble?

[netcurtains] 18/1/2021 09:37

LOL - this share is going all over the place.
Its like rock and roll.
Gawd knows where it will finish up!

[netcurtains] 18/1/2021 09:02

!FOLLOWFEED

[netcurtains] 17/1/2021 20:16

1spotter: That bit of the jigsaw added to the independent review implies BABs might be putting itself up for sale as a whole or for key parts. There are lots of angles here. Its going to be interesting to see how this all pans out.

[essentialinvestor] 17/1/2021 19:34

The key comment..."We have recently started a detailed review of our balance sheet and contract profitability. Early indications suggest that there may be negative impacts on the balance sheet and/or income statement for current and/or future years...".

A well trodden road for this sector, a sector that has been an absolute
mine field for PI's.

[netcurtains] 17/1/2021 19:06

Thanks ptonks, always nice to have the reverse view. There would be no market if everyone agreed.

[poikka] 17/1/2021 17:16

Who's recommending looking for a short-term gain, Minnie?