Best Of The Best Share Discussion Threads

[serratia] 27/6/2020 16:02

Jackson 83,

I like this share as it is possible to track the operating profit fairly accurately.
If your comment relates to the last set of results it is overvalued. I have everything set up on a spread sheet and back tested it over 3 or 4 years. The last results gave me a target price of £11 and the previous results gave £5.35. In each case the figures predicted were pretty accurate and I can see the figures ahead of the results.
If you know where to look you can see where it is today looking forward to the H1 results. This changes with time but as of today it's signalling an under price.

Are you willing to explain why you think otherwise ?

[peart] 27/6/2020 15:59

jackson83, your post has me curious. Please elaborate on why you think the stock will drop like a stone at some point. Different views are what makes a market, but with the recent earnings that were tremendous, management upgrade to internal forecasts already in the current year and an FSP on the table when the stock was at £12.50, I suspect, unless I'm missing something, that the current risks are to the upside not the downside. My suggestion, in light of your views, would be for you to short the stock and if you are proved right you will make a great return. I would not, for what my view is worth, be currently recommending that though.....

[jackson83] 27/6/2020 14:45

with only 9m shares and 75% of that is not in public hands this will drop like a stone at some point ... you were warned ....STRONG SELL ... WAY OVERVALUED NOW.

[peart] 27/6/2020 08:20

I'm with you Investographer, with such growth 30 times fwd earnings is a reasonable price - hence a current price of £21. If it doesn't sell and the earnings become more of a reality with perhaps upgrades to earnings expectations as the months pass, then £21 should be reached later this year regardless, maybe higher if future growth starts to look realistic beyond this current year. I also, whilst we don't know, agree with your sentiments on the way the FSP came to light. I think it's as they said in their announcements and as such only a knock out offer would make them accept. I don't think Wiggy Kit is a huge concern financially, its small, appears to be doing pretty well and if it needed funds, for its apparent size I can't see it affecting the BOTB pot very much at all. Maybe using a bit of the dividend they will receive on 10.7.20, or using it's current accounts and borrowing from a bank. I'd let Wiggy Kit stand on its own two feet which it appears to be doing so at present.

[investographer] 26/6/2020 21:41

The Hindmarchs are a serious family of entrepreneurs. Williams wife Wiggy runs her own fashion line WiggyKit.Williams sister is the famous designer Anya Hindmarch.Would he want to Invest some of his near GBP 100 million helping out his wife.Has to be careful not to blow it like David Beckham did with his wifes fashion label.

[investographer] 26/6/2020 21:30

Great posts folks. I believe this is worth GBP 21 currently with future growth of a year priced in.The Hindmarch family have put in 20 years of graft & have been rewarded very well recently with dividends, this year getting over GBP 1 million.I believe they were approached informally & have now made it official.I do not think they had any plans to sell, so if they had to, it would be for top dollar. The onus is on the potential buyer to offer something astounding. I do no think they will accept anything under GBP 25

[3ootuk] 26/6/2020 21:15

Retention rates and conversions should improve in the near future as the mobile apps become available, and the new hire optimises spend per customer.
As a business they seem to be doing things right.

Both main directors are in their mid 40s, so no rush to sell out.

Their other business "Wiggy Kit Ltd" seems to be doing alright too.

Maybe they might sell out given they've taken the company so far, and possibly are serial entrepreneurs. That sort of money gives you a lot of options in a world where "spot the ball" might be replaced by something else which people rave about.

[peart] 26/6/2020 20:34

Also Ryanc106, we don't know if it's purely a business decision to sell. Whilst we assume it is and it appears so from what we've been told, the controlling director might want to get out for other reasons. I suspect not, but we don't know. People can express an interest after they have been approached. I hope it is as clear as they say it is - that way we should get a good price for our shares. It's all interesting stuff.

[ryanc106] 26/6/2020 20:25

Absolutely agree Peart.
It’s all speculation of course but a bit of basic maths suggests no reason why £25-30 wouldn’t be attainable using a multiple of 30 and new eps guidance (which is probably low as you say)
30 as a multiplyer is pretty conservative too considering the current and future growth prospects BOTB has.
Anything is possible £21 bare minimum - £40 top end maybe!
Interesting times

[peart] 26/6/2020 20:03

Yes, Ryanc106, I agree £21 would be a bit derisory assuming the forecast of £0.7/share is met for the current year. If that figure was the forecast at the year end then since then, at the results announcement, the directors stated that they were trading above the company's own forecasts. That would suggest that £0.7/share for this year (2020) is a bit light - I've seen suggestions on this board that £1 might be reached. Recently they have regularly upped their forecasts. Also, if a company grows by 86% plus in this current year I doubt they will drop to no growth in the 2021 year - probably 50% plus is a reasonable and conservative guess. So we might be realistically looking at a 2021 forecast of £1.05 - £1.5/share. I know these figures are just my speculation, but perhaps they could be deemed reasonable speculation based on what we know. With such growth P/E's are normally pretty high, say 30 times min... That's early £30's to £45 per share. I know these figures are based upon next years possible earnings and not the current one. But this outfit is an internet based company that has a very high return on capital employed with a very small staff that creates those earnings. They seem to have hit a sweet spot and it's up, up, and away! Ultimately it'll be what a buyer or better still buyers (as that will force the price up) are prepared to pay and what the controlling directors are prepared to accept. Whilst £45 might be pushing it, £30 doesn't feel to pricey for a buyer to me. Fun and games....

[ryanc106] 26/6/2020 19:43

Yeh I’d say that range would be there or there abouts Peart! Probably in the latter half of that range possibly!
I’d be astonished if they let it go for anything less than £21.

[peart] 26/6/2020 19:34

Any views, just for a bit of speculation as to what an offer price per share might be, assuming it is a cash offer? For what it's worth, my view is between £21 and £30 per share....

[peart] 26/6/2020 19:29

Do Market-makers get to know something so they can prepare?? I doubt it as they could then talk, but perhaps they are brought into the fold for legitimate reasons. I have no idea on this front....

[mammyoko] 26/6/2020 17:41

Market-makers know something?

[ryanc106] 26/6/2020 17:26

What you thinking Mammyoko?!

[mammyoko] 26/6/2020 17:11

Bid firming, spread closing.

[ryanc106] 26/6/2020 13:21

Likewise! Something is going on.

[investographer] 26/6/2020 10:46

Interesting to see that for the first time, my broker is willing to take 5000 of my shares off me.Only able to buy 1000.There must be demand somewhere....

[ryanc106] 24/6/2020 11:49

Agreed... Pretty sure they'd rather keep the £1.8m in the bank than not.

[peart] 24/6/2020 09:36

Whilst 4.30pm today is a deadline (ex div 25.6.20) the directors could withhold the dividend up until payment day 10.7.20. It's not a deal breaker in any event, but is an issue all the same.

[ryanc106] 24/6/2020 08:27

Still no announcement!? I’m expecting a blockbuster in the coming days.
Would of thought the buyer would of wanted to take the ex divi off the table

[mammyoko] 23/6/2020 21:05

8.2 DISCLOSURE BY THE OFFEREE COMPANY
(a) An offeree company must make a public Opening Position
Disclosure:
(i) after the commencement of the offer period; and
(ii) if later, after the announcement that first identifies any
securities exchange offeror.
(b) An offeree company must also make a public Dealing Disclosure
if it deals in any relevant securities of the offeree company or any
securities exchange offeror during an offer period for its own account
or for the account of discretionary investment clients.

[peart] 23/6/2020 19:28

I've done a bit of research on these Form 8 (OPD)'s and it appears to me that companies in takeover discussions all make these Form 8 (OPD) announcements and an offer does not automatically follow. So who knows, it might just be red tape that BOTB has to do in this situation....

[peart] 23/6/2020 18:13

I reckon there will be an offer tomorrow as the stock goes ex dividend on 25.6.20, which would add a complication to events, whereas matters will be cleaner for the company and a buyer if the accepted offer was made before this occurs. The company could cancel the dividend with the takeover announcement - the directors have an incentive to do that as they will pay less (%)tax on a stock sale to the (%) tax on the dividend element. I reckon the form just posted (Form 8 (OPD)), increases that likelihood!