Bloomsbury Publishing Share Discussion Threads

[rainmaker] 03/3/2012 15:11

Re ventilation specialist,Titon Holdings(TON) which closed at 41/44p yesterday-Just reading about activity in the UK housing market and note that average house prices and the level of mortgage lending both rose in January. Mortgage approvals reached a 25 month high and the price rise in February was the highest since April 2010. Clearly the housing market is recovering although unemployment is predicted to carry on rising due to cutback in local government.I believe it was Taylor Woodrow that recently announced a surprise dividend so they're clearly optimistic. In holding Titon I've just predicted that, sooner or later, the housing market will eventually return to more normal levels of business activity and I don't believe the current Titon Holding share price reflects that the recovery process has already started.


regards

[rainmaker] 03/3/2012 14:46

I've been checking back over Bloomsbury's earnings over the last 10 years or so and looking at the Company's value range. You calculate a "value range" by taking the the 12 month high share price and dividing it by the earnings for that particular year and likewise with the low share price. I find it's a really useful way of 1)gauging a Company's relative cheapness and 2)working out a share's potential gain.Obviously for some Companies a p/e of say 12 is expensive but for others it's cheap.

The last time I worked out a value range for Bloomsbury I got an average high p/e of 21 and an average low p/e of of 14.If I used other value metrics such as price/sales,price/book or price /dividend yield it gave me much higher value ranges. Applying that rating to the adjusted prospective earnings for Bloomsbury we get a value range of 148p to 222p. There was a post saying that this value range for previous years was misleading because of Bloomsbury's high levels of cash.ie if Bloomsbury didn't have net cash then they would have traded on a lower rating. I didn't agree and having checked the figures, I still don't-Bloomsbury have only really had substantial net cash in comparison to their market capitalisation, in recent years when their rating hasn't been that high.In the previous years they generally traded on a much higher rating but had less cash (as a proportion of the market cap). I'll post the figures latter and allow everyone to make up their own mind.

regards

[rainmaker] 03/3/2012 13:38

Just looking at the implications on future earnings for the sale of the German subsidiary-

Year Ending Profit (£m) EPS P/E PEG EPS Grth. Div Yield
29-Feb-12 6.34 8.58p 14.1 0.5 +29% 4.96p 4.1%
28-Feb-13 7.23 9.79p 12.4 0.9 +14% 5.30p 4.4%
28-Feb-14 7.90 10.70p 11.3 1.2 +9% 5.70p 4.7%

If we look at the previous trading update Bloomsbury stated that their trading for the then current year(ending 29 Feb 2012) and next, was in line with market expectations. If we add £600k annual losses of their German subsidiary to the forecast for years 2013 and 2014 we get the following-

2013 £7.83mln so adjusted eps is 7.83/7.23 x 9.79eps=10.60p

2014 £8.60mln so ajusted eps is 8.60/7.90 x 10.70eps=11.50p
So prospective earnings of 11.4 times for 2013, falling to 10.5 in 2014.

Since we are at the beginning of March (Co's year end is 28 Feb)we can say that the growth in earnings per share is 10.60/8.58 x 100=23.5% and the prospective p/e (current share price of 121 divided by 2013 adjusted earnings)of 10.60p is 11.40 times so a PEG of 0.48

To adjust the current share price of 121p to get a fairly rated share price(in terms of PEG)we have to multiple the current share price of 121 by 1/0.48= 252p, nearly twice the current share price.

IMHO short term,the share price is going substantially north of current levels

regards

[rainmaker] 02/3/2012 19:49

Here's a juicy RNS for Bloomsbury Publishing(closed today at 120/122p) released a couple of days ago.A decidedly muted response from the market but watch out for those broker upgrades.The deal's worth a tasty £4.4mln cash and rids Bloomsbury of £500k annual losses at it's troublesome German subsidiary.The deal re-affirms Bloomsbury's commitment to english language publishing.


Bloomsbury Publishing PLC
29 February 2012

Bloomsbury Publishing ("Bloomsbury")

Proposed sale of Bloomsbury Verlag GmbH and

Strategic publishing partnership in Germany with Piper Verlag



Bloomsbury Publishing today announces the sale of its German subsidiary Bloomsbury Verlag GmbH to a subsidiary of Bonnier AB and a strategic publishing partnership in Germany with Piper Verlag ("Piper"), a company in the Bonnier AB Group.

The consideration will be €2.6 million in cash for the entire share capital of the business. In addition the purchaser will pay Bloomsbury €800,000 for the German language rights in publications from the Bloomsbury trade divisions and a further €1 million for the use of the Bloomsbury Berlin and associated brands. Both of these contracts, payable upfront, are over a three year period and renewable at Bloomsbury's option.

The sale will complete in the next few weeks, subject to regulatory approval by the Federal Cartel Office in Germany. Bloomsbury intends to retain the proceeds for future investment in its business.

Following the transaction, Bloomsbury Berlin will continue to bring authors to the German market from Bloomsbury Publishing's international stable of authors which includes Khaled Hosseini, William Boyd and Ben Schott.

For the 14 months ended 28 February 2011, Bloomsbury Verlag reported revenue of £10.1 million and a loss before tax of £0.6 million, before highlighted costs of £1.7 million. As at 28 February 2011 Bloomsbury Verlag had gross assets of £8.1 million.

This move follows the creation of a new subsidiary in India, which is in line with the One Global Bloomsbury strategy of focusing on publishing books in the English language.

Nigel Newton, Chief Executive, commented:

"The future of Bloomsbury in Germany is now strengthened through this new strategic partnership with Piper, one of Germany's leading literary publishers. We look forward to our cooperation with them as we bring some of the most successful international authors commissioned by our editors in London, New York, and Delhi to the German market."



For further information, please contact:



Daniel de Belder/Rosanne Perry, Pelham Bell Pottinger
[phone]







Bloomsbury Publishing Plc- Bloomsbury Publishing is a leading independent publishing house with companies in London, New York and Sydney. Its founder and Chief Executive is Nigel Newton. Its four divisions are:

Bloomsbury Academic & Professional Publishing - Bloomsbury Academic & Professional specialises in the humanities, social sciences, law and tax. In 2011 and 2012, it will be publishing online the digitized edition of the Winston Churchill Archive, as well as new digital services in Irish Law and Tax, UK Tax and Drama Online (with Faber). The division includes Continuum, Berg Publishers, Methuen Drama, Arden Shakespeare, Bristol Classical Press and Bloomsbury Professional.

Bloomsbury Information- includes a number of information databases for electronic as well as print publications. Publications include The Encarta ,World English Dictionary, The English Language Teaching Database, The Macmillan English Dictionary, Business: The Ultimate Resource, and others. Bloomsbury also provides management services for Bloomsbury Qatar Foundation Publishing, a division of the Qatar Foundation.

Bloomsbury Adult Publishing- a substantial list of successful authors including Khaled Hosseini, William Boyd, Margaret Atwood, Donna Tartt, Elizabeth Gilbert, Richard Ford, David Guterson, John Irving, Jay McInerney, Ben Schott, Anthony Bourdain, William Dalrymple, Ben Macintyre, Dava Sobel, Mark Kurlansky, Chelsea Handler, Heston Blumenthal, Hugh Fearnley-Whittingstall and recent Man Booker Prize winner Howard Jacobson. The division also features significant reference projects including Wisden, Who's Who, Reed's Nautical and Whitaker's.

Bloomsbury Children's Publishing- a highly successful list including authors such as J.K.Rowling, Neil Gaiman, Debi Gliori, Alyxandra Harvey, Carrie Jones, Shannon Hale, Louis Sachar and Benjamin Zephaniah.

This information is provided by RNS

The company news service from the London Stock Exchange

END



regards

[bogotatrader] 14/2/2012 09:29

Rainmaker....good IC coverage and good rns re India today.....this stock will head for 200p ...short-term I have exited as I see better short tem relative performance in IFD which is a commercial property value play with a 10% yield.....

[rainmaker] 13/2/2012 22:19

CW, Bogota-I good write up for a Company in the Investors Chronicle isn't always a bad thing.Their annual bargain list of Value shares has a terrific long term record, beating the benchmark FTSE All Share index in eleven of the 13 years-

1999
IC Bargain portfolio
+59.0%
All Share Index
+17.3%

2000
IC Bargain portfolio
+28.1%
All Share Index
-4.5%

2001
IC Bargain portfolio
+2.5%
AllShare Index
-17.2%

2002
IC Bargain portfolio
-29.0%
All Share Index
-31.0%

2003
IC Bargain portfolio
+146.0%
All Share Index
+29.0%

2004
IC Bargain portfolio
+17.1%
AllShare Index
+11.0%

2005
IC Bargain portfolio
+50.0%
All Share Index
+16.1%

2006
IC Bargain portfolio
+16.9%
All Share Index
+11.3%

2007
IC Bargain portfolio
-0.9%
All Share Index
-6.0%

2008
IC Bargain portfolio
-60.1%
All Share Index
-30.9%

2009
IC Bargain portfolio
+53.4%
All Share Index
+25.6%

2010
IC Bargain portfolio
+46.1%
All Share Index
+18.6%

2011
IC Bargain portfolio
-19.5%
All Share Index
-0.27%

IC compound annual return +13.8%
FTSE All Share +0.7%


regards

[rainmaker] 10/2/2012 10:10

Thanks CW-sell now,no way!You want to give up your £1 coins for 50 pieces?!.I know the Investors Chronicle takes a lot of stick but the long term record of their annual "bargain" portfolio is excellent. From memory, they've only had one out of 15 years when they've failed to outperform the benchmark FTSE All share index-they've made speculative bio-tech start up picks that would have Ben Graham spinning in his grave, stretched his stock picking criteria way past breaking point but they still make money!

regards

[cwa1] 10/2/2012 09:20

Seems as if BMY has made it in to the IC Bargain shares list for 2012. Time to sell?? ;-)

Link to potfolio with, allegedly, haven't seen it myself, all the picks:-

[rainmaker] 01/2/2012 17:58

Yep Bogota.........onward and upward!

regards

[bogotatrader] 01/2/2012 16:53

Rainmaker.....through the 110p level and guess near term it is onwards towards 120p level in next leg up....

[rainmaker] 25/1/2012 23:53

Agreed all-I've been watching level 2 and there's very little stock around. I've got absolutely no interest in selling at anything like current levels.

regards

[bogotatrader] 25/1/2012 14:58

I think there are several institutional buyers in the background.......to fill there orders if no stock comes out at this level then the price may need to be marked up 10% before stock comes out....

[smicker] 25/1/2012 14:01

The volume is miniscule. It looks like there will have to be a more significant move before current holders are prepared to sell. Getting interesting

[rainmaker] 25/1/2012 13:46

Sorry, as per Wikipedia there are apparently 1.18bln Catholics worldwide. Absolutely no surprise to see the share price moving higher against the backdrop of a generally weak market.

regards

[rainmaker] 25/1/2012 11:23

Bogota-Re a large one day rise........quite possible as the "market" plays catch up.Potentially Bloomsbury could resell every hardbook ever sold in the new e-book format. Their acquisition of Continuum appeared a full price but it came with a back catalogue of 7000 titles.Aside from £2mln a year in synergy cost savings with this acquisition,there's a major Catholic religious Publisher with titles from the likes of ex Pope John Paul-I think globally there 900mln practising Catholics so there's a huge market for their pulications. IMHO there is no doubt that Bloomsbury's e-book sales will remain very strong for many years as readers buy their favourite books in a digital format.

regards

[rainmaker] 25/1/2012 10:24

Bogota....no problem. I could do another constant growth dividend discount model for Bloomsbury and get a much higher intrinsic value but it would just prove what we already know-that the current share price doesn't reflect any growth.....yet we know there is growth in Bloomsbury's earnings in abundance through acquisitions and the boom in e-book sales.

regards

[bogotatrader] 24/1/2012 16:55

Rainmaker....like you I take medium term view on this one...but also follow shorter term activity to get a better feel.....buy MM action I think there are big buyers in the background and one day we may get a 10% rise to get stock out to fill teir orders....

[bogotatrader] 24/1/2012 07:36

Rainmaker , thanks for your PEG calculation....

[rainmaker] 23/1/2012 23:39

Bogota-I'm just going to sit and waiting patiently for Bloomsbury's undervaluation to correct itself.I don't expect to have to wait much longer before the share price msakes substantial progress. I also noticed with interest, the two Institutions increasing their stakes.

I've calculated an updated PEG for Bloomsbury with an interesting conclusion, as follows-

Bloomsbury(BMY)-104p

Earnings per share

28/2/11 6.63p(hist)
29/2/12 8.90p(frd)
28/2/13 10.32p
28/2/14 10.90p

So assuming we are mid Jan, the historic "rolling eps" is as follows-

(1.5/12 x 6.63)+(10.5/12 x 8.90)=8.61

prospective "rolling eps" is as follows-

(1.5/8.9 x 8.90) + (10.5/12.0 x 10.32)=10.1425

so % increase is 10.1425/8.61 x 100= 17.79%

prospective p/e is 104/10.1425= 10.25

so Price Earnings growth rate or PEG is 10.25/17.79=0.5761

As a Company is reckoned to be fairly valued with a PEG of 1, we can calculate the share price at which Bloomsbury is fairly valued by

1.00/0.5761 x 104=180.52p which is slightly above Investec's target price of 173p.

regards

[bogotatrader] 23/1/2012 17:53

RNS...Schroder holding threshold crossed....

[bogotatrader] 23/1/2012 16:28

RNS....Blackrock have taken their stake over 12%.....

[bogotatrader] 20/1/2012 16:38

Rainmaker...a few good buy trades today and well bid.....re-rating continues.....let's hope this makes a run through 110p next week and on towards the 120p/130p area....

[shanklin] 20/1/2012 11:20

RM

Lots of BMY's business is very strong.

Personally, I think you have to assume that a significant proportion of its current profits from selling book downloads will disappear due to illegal downloads. But I don't know how much of BMY's profits this activity currently provides.

Cheers, Martin