Capita Share Discussion Threads

[frazboy] 19/4/2018 10:51

there will be a rights issue.

[abbotslynn] 17/4/2018 20:28

Gaining ground very slowly,slowly

[inthemix] 13/4/2018 15:47

Yep bad decision to short! It's closed now ":'^(

[dealy] 13/4/2018 13:56

No need for RI if it's gets acquired

[marles] 13/4/2018 12:37

Insiders getting a sneaky early peek at plan to be published on the 26th? Price of rights issue seen?

[dealy] 13/4/2018 09:35

No free ride to riches here by going short at this level. Many stones on the road to Armageddon such as funds seeing long term value, improvement in operating performance or reduced need for equity.Long from here.

[frazboy] 13/4/2018 08:56

i wonder if we'll get a bit of a run in the SP, prior to the rights issue? slightly off topic, but I've noticed a lot of short term strength recently in bombed out stocks, AA and Greencore to mention two.

[frazboy] 12/4/2018 18:15

£4.5bn? More like £1.7bn pre rights.

[inthemix] 12/4/2018 17:36

Out of interest have we got more short than long here? Seems not many have much hope with the 4.5billion pound debt. I went short yesterday and still holding my position.

[frazboy] 12/4/2018 15:29

Dear oh dear, Woodford has been averaging down. Again.

[kingston78] 12/4/2018 10:00

If the machine continues to chuck out money Capita would not have been in this situation with a huge debt mountain. The rate of return must have been declining. Just like a gambler who pursues a "double or quit" strategy, Capita continued to spend even more borrowed money to buy more businesses just because they were fixated with "growth" and "increase in earnings per share". This aggressive approach got the company into a downward spiral financially as well as operationally.

There used to be a company called Lonrho, which expanded into all sorts of businesses in Africa with a tangled web of thousands of wholly owned and partly owned subsidiaries and joint ventures that even the auditors (KPMG) could not keep track. No one really knew how the legal group structure worked. Rumours had it that there was so much litigation against the late chairman (founder) and the company itself that a full time partner at KPMG was dealing with this aspect of Lonrho, keeping tab of business coverage. Eventually Lonrho was broken up into a number of parts and one of which surfaced as Lonmin.

The above story is typical of how small companies grew into giants which became unmanageable, so they were broken up to become smaller entities again.

[dexdringle] 12/4/2018 09:07

........but has the machine stopped chucking out the money ?

[kingston78] 11/4/2018 23:04

Many businessmen and even some accountants use inappropriate financial measurement when considering whether to go ahead with an acquisition of a new business. Many of them use the EBITDA, which I personally dislike. EBITDA flatters the return. The real return to the buyer is earnings after tax. This will forecast how many years it will take for the new business to pay back the original investment. If at the end of say 10 years the original investment is paid back, any inherent value that still remains of that business is the Capital Gain.

I believe that a cautious businessman will adopt more conservative purchasing criteria whereas those with big ego will buy anything in sight for the sake of buying.

A cautious man will fund the acquisition with a large part of internally generated cash flow and the remainder with debt finance. Those who borrow to the hilt, with foolish and willing bankers to lend, will find to their cost when things go wrong a few years down the line. This is akin to getting into NEGATIVE EQUITY in a housing situation. Both the companies and banks will be in trouble. This is not a new phenomenon. History will repeat itself.

[inthemix] 11/4/2018 11:54

Yes I agree back down now.

[forwood] 11/4/2018 09:02

Looks like they're knocking them off the shy a bit now Eisler. Typical top out on the hourly chart at 145 resistance but am unsure it's finished with the move up. On balance I'd have to say back down.

[pal44] 10/4/2018 18:00

Debt mountain is still there... could be a bear trap. Imho

[eisler] 10/4/2018 16:11

Give that man a coconut - in fact, give him 2

[tim 3] 10/4/2018 16:04

"Capita shares jump as Volkswagen extends customer services contract"

(Sorry link not working)

[dealy] 10/4/2018 15:35

The UK is a corporate graveyard right now with existing companies in many sectors going bust and no new ones being created. Meanwhile work still needs to be done. In light of this I would say capita shares are very cheap right now. No free ride for shorters

[oscar000] 10/4/2018 12:59

Eisler you need to say outloud give that man a coconut

[inthemix] 10/4/2018 11:54

Seems to be holding well at 140

[bookbroker] 10/4/2018 10:58

RI. needs to be generous!