Communisis Share Discussion Threads

[cheshire man] 27/7/2018 09:50

Did I create a little bit of magic with that post ? :-)

[cheshire man] 27/7/2018 09:44

Sitting on support atm and with news due next week I'm guessing we will see a rebound on the run up,,,,,for those looking for an income stock it's a good price to buy IMV

[masurenguy] 27/7/2018 09:23

Thanks for that interesting input JT. It will be very interesting to see the interims that are due to be announced next Thursday (August 2nd).

March 8th Results Statement

"Communisis is at an exciting stage in its development with a bedrock of solid performance and deep client relationships to build upon. The growth strategy for the next phase is highly focused and we already have clear evidence of the themes of Digital First, Global Reach and Empowered Organisation, resonating in our key markets. The Board is looking forward to another positive year for the Group." Andy Blundell, CEO

"Communisis remains committed to delivering enhanced returns to its shareholders. The announcement today of our three year VEP is a new expression of that commitment. Alongside investing capital in pursuit of that growth, we will continue to ensure that a strong dividend remains a key component of our total shareholder returns policy." David Gilbertson, Chairman

May 10th AGM statement

"The Board confirms that trading expectations for FY2018 are unchanged and Communisis is progressing its growth strategy known as the Value Enhancement Programme (VEP)." David Gilbertson

I think that we need to see confirmation of delivery against some of the above outlook statements in order to reignite an upward trajectory in the shareprice. There needs to be a catalyst since a 26% increase in the shareprice over the past 5 years is not only very disappointing but also slightly less than half the FTSE 250 increase, which is up by 54% since March 2013, which was when the last CMS placing at 40p occurred.

I also think that Otus Capital Management will be looking for some positive reassurance too, since acquiring 12.8m shares earlier this year at an average price circa 62p, as they must be nearly 20% underwater at the moment.

I must admit that I look at CMS more as an income share these days rather than a capital growth investment since it is yielding me circa 7.5% against my acquisition cost. As previously noted here I sold 50% of my long term holding @ 60.5p in early December so this is now my 3rd largest holding.

[jtcod] 27/7/2018 08:31

It is the former Nick not the latter. CMS is responsible for customer communications ‘in their entirety’ for a significant part of their revenue stream. Also because there is a saving for the client/company in having customers go digital, CMS is compensated under the contract for their success in switching customers. The contract could be looked at as more of a partnership this way. Both benefit in the move to digital.
The ‘entirety of communications’; business offering sounds like an obvious sales strategy but one of the lesser recognised aspects of CMS business offering is that over the last decade UK financial services has seen legislation become a burden and liability for small financial bodies which do not have sufficient resources to manage the issue. Many simply wanted an all encompassing solution (such as that offered by CMS) to which they could hand over responsibility safe in the knowledge that documentation will follow current rules. These contracts are not of the size that would trigger an RNS but there are lots of them nonetheless.

[nick rubens] 26/7/2018 20:07

The transition to digital sounds ok if that means CMS are handling the switch from paper to digital and not potentially losing paper communications customers to it?

[masurenguy] 26/7/2018 16:30

Quite agree edmund - there seems to be no logic to it at all. However, some shares seem to be unloved by the market and fail to achieve or maintain a valuation commensurate with the various templates and ratios one uses to try and determine this. CMS seems to have the attributes of that particular syndrome with the current price just 26% above the last placing price of 40p just over 5 years ago.

If the market continues to undervalue CMS then it could become a prime target for a predator who can!

[salchow] 26/7/2018 16:22

Trades are almost non-existent which may be an indication that it is around its low. Lets hope there is something to rekindle interest.

[edmundshaw] 26/7/2018 15:27

The May trading statement was fine, results next week. Not sure why this should be relegated to a PER of 8 right now, with a positive outlook and a yield over 5%. But the share price has done some pretty odd things in the past...

[zipstuck] 29/6/2018 10:48

I think a number of marketing companies are struggling with the burden of data security. According to its annual report CMS is also transitioning from paper to digital. I guess there are a number of uncertainties and consequent caution in the sector.

[gleach23] 27/6/2018 18:17

A couple of noteworthy trades (750k and 315k) reported after the bell, both @ 54p

[sirgainalot] 27/6/2018 10:09

Anyone aware of why this has been so weak of late?

Especially since the AGM said trading expectations were 'unchanged'.

[jtcod] 22/6/2018 17:23

Hi Edmund, I appreciate that but if the sector was seeing significant problems I doubt it would have bounced 100% regardless of the sell-off. Often when companies have the sort of problems SIV had they tend to accompany a sector downturn or fundamental problems with the sectors long term future and they stay down for years. I don't see evidence of that here, which was my point.

[masurenguy] 22/6/2018 16:44

Good to see a late buy of 170,991 shares @55.4p today, which resulted in a modest uptick at the close. Perhaps this might be a catalyst to get the shareprice moving north once again !

[edmundshaw] 22/6/2018 15:31

JTC SIV has seen its share price double yes, but from the price after an over 75% fall. It is still less than half what it was about 2 years ago before the big profits warnings (104p vs c.230p). So it is recovering from a major sell-off, hardly a fair comparison with CMS.

[jtcod] 22/6/2018 09:34

Aviva for instance has 50% of its earnings in Euros. It saw a sharp 8% drop when the Italian problems hit and has not recovered.

[jtcod] 22/6/2018 09:19

A plausible explanation might be that MMs have simply marked down stocks with exposure to Euro denominated trade in the face of the recent concerns over Italy.

[jtcod] 22/6/2018 09:12

........and SIV has seen its share price effectively double over the last 12 months against CMS up less than 10%. The SIV performance would normally imply a buoyant sector, so its a bit of a conundrum really.

[masurenguy] 21/6/2018 23:47

The shareprice has fallen by 21.5% over the past 6 weeks in contrast with the FTSE 250 which gained 5.4% over the same timeframe. However, the average daily trading volumes have been exceptionally low during this period at only 40% of the average daily volume over the past 3 months so the fall is not due to any meaningful sell-off. Consequently, there would not appear to be any expectation of an impending profit warning.

The interim announcement is due in 6 weeks, on 2 August, so we will probably have to wait until then for any further insight unless there is any contract news in the meantime.

[its the oxman] 21/6/2018 10:54

Do people sense a profit warning coming, or is it something else? Big fall now.

[zipstuck] 21/6/2018 08:53

Wondered if the data protection issue has impacted customers and caused delays and reduced marketing spends.

[jtcod] 19/6/2018 09:00

I thought it interesting that the drop to 56.2p represented 20% from the January peak. In the grand scheme of things it didn't seem to trigger much in the way of stop-losses. Most the holders these days are institutional.

[zipstuck] 19/6/2018 07:08

The 48333 was a delayed buy offsetting the 48333 sold in the in the morning.

[masurenguy] 18/6/2018 16:52

Quite bizarre - just over 600 Sell transactions of 50 shares, all timed between 15.23.19 and 15.23.21, so obviously programmed. Thereafter a Sell of 48,333 was reported just after the close @57.26 and the closing price has now also broken through support @60p for the first time this year !

[cheshire man] 18/6/2018 16:07

Not quite seen anything like that before,,,,,,a few yes but this ??

[rhubarbcrumble] 18/6/2018 15:36

Many sells of 50 shares. Curious.

Any explanation?