Cmc Markets Share Discussion Threads

[primarch1] 05/11/2021 14:01

Somethings in the air,this is 50% cheaper than the summer bargain for one of the bigger boys

[jemt0703] 05/11/2021 12:49

Yes, possible bid coming for CMC. Why did IG raise/apply for a 1M Euro bond I wonder??

[primarch1] 04/11/2021 15:00

Whispers of a bid on this we're see,certainly good value

[dros1] 03/11/2021 14:31

from CMC website

. "However, it should be noted that short bursts of market activity which result in high-velocity movements in the products that we offer are not necessarily beneficial to our clients nor the Group."
Is this not the reason of the drop in activity lately?

[dancing piranha] 29/10/2021 16:49

Don't worry, it's only the linear regression line!!

[insideryou] 29/10/2021 11:30

Relentless sell off daily. Thoughts?

[primarch1] 28/10/2021 09:10

Surprised at how cheap this is now,they clearly got ahead of themselves but over a 50% retrace is now well oversold especially as the summer lull is over.

[aleman] 18/10/2021 14:04

Doesn't a sharp fall in short Gilts count as volatility. I'm seeing more volatility but VIX is not doing much (at around 17). I reckon traders will be active as volatility seems to be moving out of energy into other areas. Maybe I'm wrong. We'll see.

[dagoberia] 14/10/2021 16:06

Does anyone know if this goes ex dividend soon? Dividendmax says 25/11 but i think that may be wrong

[weemonkey] 14/10/2021 14:17

Volatility is back. Market up and down like the proverbial.. Should be helpful here..

[markbelluk] 14/10/2021 13:55

Piranha not sure where you learnt Technical Analysis (youtube???) but you are a country mile out. Start with a linear regression line

Luck not needed thank you

[aleman] 13/10/2021 17:31

A one-month average of Vix is the highest since March, suggesting business should have picked up some.

[dancing piranha] 13/10/2021 16:49

Pre pandemic below 200p, and that's where this is heading again, barring another lengthy lockdown! The chart is telling you all you need to know, believe otherwise at your peril, so over and out here... good luck all!

[rcturner2] 13/10/2021 15:41

The thing you have to remember with someone like CMCX is that they are constantly shedding clients. Remember that a significant proportion of spread bet accounts are not active 6 months after being opened. So they constantly have to add new clients to stand still. There was a boom in new business during certain phases of the pandemic. How that plays out now is open to question.

[markbelluk] 08/10/2021 18:10

Graham if you analysis the volume split it says it all. On book SETS is accounting for about only 15% of the total daily volume. Hence most PI's are either P off with this or waiting on a low/er level entry.

My opinion is as institutions continue to buy up at these levels PI's will catch back on and we will see upwards movement

[grahamg8] 08/10/2021 17:18

Great discussion guys, quality in a nutshell is about repeatability which CMCX and similar businesses don't have. That is not the same as saying they are a poor company or a poor investment. Certainly the lower CMCX share price seems to have reflected some level of uncertainty going forward. I suspect the broker forecasts were in the main issued before the profits warning of 2 September. Peel Hunt says strong customer levels could indicate a rebound if activity picks up. In this context sky high gas prices and Evergrande on the brink of collapse are good news. Some are suggesting a share price fall to around 150. So set this against a median target of 397 you get a mid point of 273. And where is the share price? 267 at close. Who needs CFDs when the shares themselves are likely to be pretty volatile in the coming months.

[markbelluk] 08/10/2021 14:05

>Those are heavy falls.

Already priced in ....we are 51.6% off the 52 week high

8 different brokers have a median target of 396.7 (FT has 6 with a median of 425)the lowest been 275 (highest 463)

[imastu pidgitaswell] 08/10/2021 13:32

And what happens to earnings if revenue doesn't hold up to those projected levels, as it has fallen so much already (but still way higher than 2 years ago, so it could well happen)?

It's not as black and white as all or nothing - but surely you can see that adding on costs to service more revenue, followed by a dramatic fall in those revenues, is a bad thing for the business - and earnings going forward?

Also bear in mind the additional Australian and New Zealand revenue will come with its own additional costs base - it's not just adding on revenue to the UK cost base. I say that, I don't know what the plan is - biut it seem likely to me.

From the statement:

-- H1 2022 leveraged gross client income is expected to be approximately GBP127 million (H1 2021: GBP174 million).

-- H1 2022 leveraged net trading revenue is expected to be approximately GBP100 million (H1 2021: GBP200 million).

Those are heavy falls.

I won't keep banging on about it - but the issue of 'quality of earnings' is a very relevant and valid concern.

[markbelluk] 08/10/2021 12:59

Net profit is still forecast to be £68m after increased costs for 2021 and £83m 2022?

Why would revenue's continue to fall in 12-18 months with the introduction of 500,000 clients and AUM still at record levels?

[imastu pidgitaswell] 08/10/2021 12:39

I (and others) are talking about earnings, not revenue. If revenues fall and costs stay the same (they increased in fact) what happens to earnings?

I'm not saying I'm concerned - I was honestly just talking about quality of earnings. And, to be fair, so are CMCX.

[markbelluk] 08/10/2021 12:33

> disappear in a puff of smoke

£250 TO £280 million ?

Each of the companies mentioned originally in this sector has seen a dip in earnings at some point in 2020-2022

If you are concerned about volume of transactions then look to the new client base and the AUM levels which remain at their highest level ever

[imastu pidgitaswell] 08/10/2021 11:50

But by 'quality' what he (and the commenters) are saying is that those earnings can (and did for the half year) disappear in a puff of smoke if volumes go down - and there is nothing the company can do to control those volumes.

Hence they are not in control of their earnings - hence 'quality'.

[markbelluk] 08/10/2021 11:46

Graham another way to look at it would be that CMCX & PLUS are seen as higher risk as they do not hedge where as HL & IGG do.

As for "Poor earnings quality here", £70m net profit (after reduction) with no net debt sitting on £150m cash and bringing in 500,000 new clients with a nice yield on top is exactly the opposite

[mngf] 07/10/2021 11:20

Good points. When I read the statement I thought "do you really expect people to buy in based on a few days of volatility?". Poor earnings quality here

[grahamg8] 07/10/2021 08:04

Share price is certainly about VIX. But also about quality of earnings. This is a bit non specific but I usually take to be a measure of predictability. CMCX and PLUS have very low P/E I believe because their earnings are considered low quality. HL. and IGG have higher P/E because to me they earn more from broking and so the income stream is more stable. CMCX and PLUS are both trying to build a conventional broking business which should give the perception that their earnings quality has improved, and so a higher P/E follows.

Just a theory.