Character Share Discussion Threads

[tkamp] 31/10/2018 09:05

@h1a3

The structure of the deal with the Danish company makes it very much like an option with a modest upfront premium. Down payment is very small and further payments will only be made if their performance accelerates. Can imagine there will be some cost synergies (mostly related to sourcing I imagine), maybe some revenue synergies too. All-in the current impact of the Danish deal remains to be seen as we have much too little information to really assess its attractiveness, but the downside seems limited, which means it's unlikely to be a (strong) negative.

All-in I'm feeling pretty good about CCT and have a sizeable position. The business has likely returned to growth again, valuation is low, balance sheet strong, operating leverage limited. While the upside on CCT is probably not, say, 100%+, I do think there is probably 30-50% upside with limited downside risk. With its decent dividend yield and current stock markets looking shaky I don't mind a whole lot having to wait for price to catch up to value.

[mcartdon] 31/10/2018 08:28

end november might increase the interest, but it would take a lot.

[h1a3] 30/10/2018 21:58

A very quiet board. Just curious if anyone has any recent views about CCT.
CCT have bought a holding in a Danish company to gain access to EU.
I had hoped that a USA toy company would be interested in taking them out.
Ah well, now back to playing the market.

[runthejoules] 01/10/2018 14:42

Ruffles seemingly keeping the price down at 500p but no less!

Could be due a pop when they've cleared, or stat range-bound till more results...

[richyst] 01/10/2018 13:00

Ah, very interesting. Thank you.

[tkamp] 01/10/2018 10:44

So if they expect to 'comfortably' meet expectations I imagine they'll get around 45p EPS for this year. The 50p forecast for next year reads a bit conservative to me since that would probably imply sales growth of less than 10% (some operating leverage). Also shares buying bought back will have raised that number by maybe 2-3%.

[orange1] 28/9/2018 21:13

Allenby Capital joint brokers to the company are forecasting EPS for 2018 of 43.6p. The figure for 2019 is 50.5p.

[richyst] 21/9/2018 17:15

What are the 'market expectations' and how does someone find this out?

[mcartdon] 19/9/2018 17:39

The spread is silly, and the market in the shares seems very slow, i guess they have a seller with a steady supply perhaps ruffer, at this level so an overhang the price is eventually going to take a step change perhaps after brexit ha ha.
only full news will get the share up for now.

[runthejoules] 19/9/2018 14:32

I see profit takers are out again, but with a biggish spread it's not worth it, continuin to hold as a low(er) risk investment

[mcartdon] 15/9/2018 18:43

The statement "comfortably meet expectations", from experience, indicates that the t/o will rise over 25% this half so from 115m to 140-150m+.
the costs of trading obviously dont increase as much as t/o as the same management and staff carry on and so profit margin may also rise.
the extra 30m will produce a higher profit than before in 2016.
so looking ahead to full year 2019 150m t/o up 25% from 2016
profit 14m 67 p a share
dividend 25p I think this should be higher as a return to all shareholders rather than funding staff share buybacks. but buybacks may continue
the shares should rise to 650 on basics but with strong growth prospects in 2020.
may add up to a pe of 13= £8.66

[campbed] 14/9/2018 10:45

Most small cap fund managers are pretty good and the ones at Ruffer are. But they can be obliged to adhere to the investment house rules. A good example is Versarien VRS where one 20%+ small cap institutional holder sold out at under 20p/share last autumn which were bought by retail investors who have raised the price to 175p currently.

Not saying CCT will go up 10 fold but it could reach 700p within 6 months imo.

[deanowls] 14/9/2018 10:30

Companies are reducing there exposure to high street and discretionary spending would be my take on it.

[h1a3] 14/9/2018 10:04

Great update however I am still curious why Ruffer reduced it's holding.

[18bt] 14/9/2018 08:27

Great update

[campbed] 14/9/2018 08:18

I hope it stays independent and produces annual growth of 20%/year.

[tkamp] 14/9/2018 08:18

This company is net cash, has high (incremental) ROICs, is very cash generative, and returning to growth. A £7 share price would still undervalue the company. If they can do ~60p EPS in 2018/2019 and you put that on 15x EPS + cash balance of ~£20mn you'd get to roughly £10 a share.

[runthejoules] 14/9/2018 08:08

Hope it gets taken out about £7, I need to pay for my loft conversion! Anyone still think Mattel might be interested?

[campbed] 14/9/2018 07:40

Very reassuring t/up I thought.

Had been fearing otherwise in view of recent share price weakness and talk of squeeze on UK consumers’ discretionary spending which would impact buying toys.

Runthejoules #13114:
I hold VRS as well. But today is CCT’s day.

[mcartdon] 14/9/2018 07:27

Well it owes 35% to stand still after 4 years can it do 150m and 67p next year.
probably 7£ target.

[runthejoules] 14/9/2018 07:17

Not so boring now 'comfortably reach market expectations'



Still wish I'd put it in £VRS though!

[mcartdon] 04/9/2018 11:48

bored probably like me

[h1a3] 03/9/2018 22:59

Ruffer reducing its holding maybe of some concern. Any thoughts?

[deanowls] 14/8/2018 02:57

It’d be interesting to see the percentage of sales via the website I expect it’s minimal and not given a great amount of time. I’ve never seen it mentioned in the results that I can remember.