Danakali Share Discussion Threads

[rabbrooks] 01/8/2005 11:49

One of the main problems for GB shareholders is the possibility of Danka cancelling the London market. The board may consider it unneccessary ,unprofitable and pointless as there are virtually no shareholders of any consequence in GB. The fluctuations in price and lack of confidence in the company by the big players will be the factor which will determine the decisions to be made by the new Management.It does not bode well for us .

[barnetpeter] 31/7/2005 17:39

The market cap of one 14th of the turnover is very low for a company in this business. It has no current cash worries and if it can move to profitability with a margin of just 5% on this turnover, the shares are worth a lot more. Going to give them two years myself.

[yellow_snow] 31/7/2005 16:13

In logical terms there is no reason not to expect a return to 60p barring a disaster in the quarterly results, but experience with Danka shows that logic isn't always followed, so for the conservative, its an option, especially if the stock was picked up sub 20p.

[barnetpeter] 31/7/2005 15:47

Talk here is a bit bizarre. If you have bought this stock its because you think a turnaround is possible. That does not mean selling at 29p. 60p is a more realistic target.

[konkorde] 29/7/2005 23:56

Yep not sure as a novice why i trade this one ?? buys and sells jump around inside the spread all day with sells appearing 1p or more less when the bid hasnt changed? Strange one but didnt sell today as visitors turned up. Looks like its levelling so will be up early Monday.

[yellow_snow] 29/7/2005 13:00

I think they were at around 8 quid in 1998 when they took over a large chunk of the Kodak business, and then indigestion set in and they found they couldn't pay the bill! Major fluctuations then as their survival was in doubt, followed by a debt restructuring which looked ok, accompanied by a spiralling drop in revenues, followed by paying down some debt early which everyone liked, followed by expensive and bodged transition to new systems etc etc etc
Not like its difficult to call or anything!

[konkorde] 29/7/2005 12:34

good post, thanks again, will keep the faith. did dabble fromthe 13p days and made a few quid then which is why i kept an interest. sold at 70p so was never aware of them back at 150p or even 9 quid! I knoe they have lots going on here with new deals and contracts so will be interesting to watch (and yes take that profit) am considering today as no movement but may wait till Mon/Tues

[yellow_snow] 29/7/2005 12:14

Theres a link to the states price in the older thread on Danka - 1 pound is the test, my investment is big from the point of view its the majority of the risk aspect of my shares but I doubt anyone else would be too impressed :)
I have had bigger positions in the past and I would have held for longer but the risks involved with the company mean its always a good idea to keep an eye on a good profit-taking period. I've bought at 150p before and still made a profit! Shortly afterwards they headed to 9p so its only the underlying value of the company thats keeping me off the sell from 20p now. Theres no good reason for the share to be below 50p in my opinion but you can never rely on logic to dictate what happens to Danka, only that there is a big swing around the corner and this one looks as if it will be upward, plus the base at around 18p (1.20 in the states was severely tested and I think will hold even given a bad quarter of results.

[konkorde] 29/7/2005 11:50

thanks yellow will keep an eye on Wed we were thinkingof a weeks holiday from tomorrow but maybe beter not just in case. sounds like you have a good investment in them but they arent that high a traded stock. i own up to having some at 40p adn these at 20p so may just sell the 20s and wait for the others..lol
could we not have a link to the states price in the header?

[miata] 29/7/2005 11:39

Selling below 40p makes sense only if you think the results will disappoint - which they have often done in the past. 60p is my eventual target IF they produce some good results for once.

[yellow_snow] 29/7/2005 11:31

Konkorde - I was thinking of off-loading maybe 25% if the price made it up to mid-30s before the results. If we're still around 30 p then I'll probably hold onto all of it. The charts tend to be more useful between results than around the time of releases since they can't take the discontinuities into account, i.e. whether the news is good or bad. I don't actually use charts at all since I tend to work on longer timescales and thats where the appeal is in Danka, by any measure I've found it looks undervalued. To that end the results would really have to shock to put a brake on the share price. Its happened before with this lot but we do appear to be in a period where the market is prepared to look benignly at Danka and they only need to be seen not to be doing as badly as before to keep the positive attitude going.
It you can check the RNS's at 1.30 next Wednesday then there are a few numbers to look out for, one of which will be revenues, for which the only analyst estimate is $280 m, so if its below that, its probably time to dump the shares. Above that it becomes a judgement call as to how well the cost cutting etc is doing. If they say they've made an operating profit you can bet its positive and should hold and probably acummulate if possible.
All IMHO and DYOR etc. but at least we get to make a judgement before the market opens in the states!

[konkorde] 29/7/2005 11:13

YS, can I ask you your post 30 do i read that that you may consider selling before results. is that because you feel it wil drop then as i know compared to you i probably only have a very small holding 2k worth but cannot read charts yet so appreciate any comments although i dont think this stock is easy on charting anyway. i was thinking of selling half before results just in case

[yellow_snow] 28/7/2005 22:12

Well if the weak holders got out on the rebound after 1.70 was broken then there is hope for further gains but I'd expect there will be some selling pressure coming up to the results as well as after they come out. Once it settles down after the results I think it would take worse than expected revenue erosion or further fubars with oracle etc. to send it back below $2.

[geng] 28/7/2005 20:02

It really is strange there is no pullback almost 100% up and very little pullback.

The drop to $1.93 was because of an institutional buy request at 1.93 and 2.00



Looks like most of todays selling is retail - the institutions appear to be mopping up the sellers. Could even close level or up?

It may be a bit premature but if the figures are good this should just carry on rising. (although there will probably be a drop on results day).

[yellow_snow] 28/7/2005 15:15

Dropped 0.14 to 1.93 just on the announcement of the results date in the states. Back up now but if you ever wanted proof that this is a share driven 99% by sentiment then that pretty much does it. Hopefully it won't be reflective of a move towards profit-taking before the results, I would have thought most of the resistance to 1.70 and 1.80 took care of that.

[yellow_snow] 28/7/2005 15:10

Results are out on Aug 3rd 1.30 pm. Keep an eye on the RNS then!

[day_dreamer] 27/7/2005 22:02

Fair comments on Danka !

[yellow_snow] 27/7/2005 22:00

day_dreamer:

Danka hasn't quite doubled yet (but my fingers are crossed) but that is from a position where they were capitalised at $70 m which I think even the harshest of critics would recognise was a severe undervaluation. I'd base that on the 1.2 bn turnover and the perceived realisable assets in the company compared to the debts.
With Danka Canda going for $14 m its pretty easy to see serious upside. There is scope for a crisis in a couple of years should the cost savings not be made but the next interims will give a clue as to the way things are going and for anyone not holding or shorting (god forbid) that would be the time to make a judgement.

[barnetpeter] 27/7/2005 21:59

Day dreamer; short-term OB only bearing in mind the uncertainty about the divi.

To be fair about Danka, it has sold off its loss making Canada arm and outsourced IT in the last few weeks:

"Danka expects to generate substantial yearly savings once the
agreement is fully implemented, enabling Danka to drive productivity and enable
further growth of its business".

Danka is a lumbering elephant that may just be starting to turn around. A turnover of over a billion gives plenty of room for profit.

[day_dreamer] 27/7/2005 21:51

bp :

Strange how INX is overbought in your view at 50% higher than it's lows yet
you dont think the same with this stock that has doubled recently yet
is still loss making and saddled with debt :-))

Gravy

[yellow_snow] 27/7/2005 21:28

Yeah the debt is still an issue, but to look on the bright side its $240 m when they have close to $100 m in cash, with only $64 m coming up for maturity in 2008, so it wouldn't really be a problem if it weren't for the terms, with some of it at 10% ! They can easily deal with it as long as they start generating profits by the end of the year and if they make progress towards that then the possibility of replacing the debt with something on better terms becomes possible. As long as it continues to rise before the results I'll take a bit of profit before them and then see what happens.

[barnetpeter] 27/7/2005 21:22

Closed strongly in the US with the offer up to a high of 2.14. Bought some early today; need a good statement tp send this higher but could just do an AHT. A load of business here worth a much higher price, plenty of cash .... but a bit of debt!

[yellow_snow] 27/7/2005 16:08

Last year the date for the interims was released on 28/7/04 and the results themselves presented on 4/8/04. Hopefully an announcement just around the corner. I wonder will a few people take profits beforehand or will the strength continue up to the release. Still bouncing off $2 in the states, good support in London.