Debt Free Direct Share Discussion Threads

[blindfaith2] 02/11/2006 09:31

I don't think it is sentiment that has caused the drop today as that would be too much of a coincidence with today's RNS, I think it is just profit taking and the price should recover over the next few days. Whilst the banks continue to whinge about writing off some debts they know that it is primarily their fault that so many people have got themselves in a pickle and they obviously don't like the consequence that they are now facing.

DFD, ACG & DETS etc have still got a way to go and the hurt facing the banks will get worse.

I sold out a while back at a healthy profit but seeing the downturn a couple of weeks ago I could not resist buying back in as like everyone else expected pretty spectacular results which is just what DFD are delivering.

All IMVHO, of course, good luck all !

[sandbank] 02/11/2006 09:22

WILLIAMS63: The reason for the fall is that the number of cases isn't increasing as fast as expected and - looking ahead - it's now anticipated there will not be as many new cases as thought for the current quarter. All will no doubt change as soon as there is a decent hike in interest rates - forcing more people into IVAs.

[chester] 02/11/2006 09:12

This is clearly a sector that is very much out of favour regardless of excellent trading statements recently. Their obviously good value but I think I shall be staying clear until sentiment changes.

[william63] 02/11/2006 09:10

I reckon someone misread the following statement:

Turnover includes commissions from re-mortgage leads, which generated
income and profits of almost #700K in the period.

Is this why the price has dropped? The £700K profit cames only from commissions! It is not the whole business profit.

Just my thoughts! I make this type of mistake on a regular basis!

[diogenesj] 02/11/2006 08:51

Usual strange market reaction: you'd think they had issued a profit warning, rather than a remarkably bullish trading statement.

[aspex] 02/11/2006 07:08

No complaints about this trading statement.
Onward and upward.

[chester] 31/10/2006 10:45

The trader in me has me closing my position here. I'm sure I will return.

[chester] 26/10/2006 21:18

This is a very nice looking chart.

[diogenesj] 25/10/2006 17:47

My impression is that all three are increasing their market share, presumably at the expense of smaller competitors, S. I expect the kerfuffle over regulation will help them continue to do so.

There's no doubt that ACG and DEBT are riskier. I feel that the risk is worth taking - but as you say, that is a matter of judgment.

[silverthread] 25/10/2006 17:25

Thanks for the clarification, Diogenes. It's good to have some substantiated thoughts on this board.

I guess it depends when you do the comparison and how frequently companies update their forecasts. Also whether a company wants to set high, medium or low forecasts. I haven't seen a recent revenue forecast from DFD - just the impressive growth in IVA cases handled.

One comment I read recently from Charles Stanley (6th Oct 06) said: "DFD is capturing a larger share of the market 19.8% compared with 18.2% a year earlier." No idea whether that is true or not, but it's yet another viewpoint.

All three companies appear to be doing well, and, I suspect, will continue to prosper in this growth market. Each must make up their own mind which offers the best and safest returns.

[diogenesj] 25/10/2006 16:45

Rather better put than my effort, Silverthread. Your point No 3 is not quite true, though. At yesterday's prices, the market cap of DFD was £208m, while that of DEBT was £74m, quite a bit more than a third. DEBT is catching up: forecast sales of DFD for the current year are £31.85m (ptp £10.85m); DEBT's sales are forecast at £28.12m (ptp £8.3m).

ACG yesterday was worth £86.82m, well over a third of DFD's market cap, and also catching up fast: forecast sales next year £31.16m (ptp £10.31m).

[silverthread] 25/10/2006 16:30

ARA500 - Although DFD is on a higher PE than competitors, there are several things that one could argue justifies this premium:
1) DFD offers a dividend;
2) DFD is longer established in the market (originally formed in 1997);
3) DFD is more than three times bigger than its nearest competitor;
4) DFD has launched in Australia
5) DFD is clearly seen as the market leader, with a professional approach to dealing with individuals and creditors (DFD is taking the lead in discussions with the banks);
6) The IVA market growth is accelerating (all will gain, but the bigger, more established player stands the best chance of capitalising);
7) DFD has a track record of several years profitable growth (some of its competitors have yet to report even one year's performance).
8) DFD has attracted buying interest from investment houses because of its size and track record.

DFD is not the only company that will gain from the IVA marketplace. For sure others will, too.

FWIW personally I feel DFD is the safer option and the one most likely to deliver good returns. But please DYOR.

[diogenesj] 25/10/2006 15:33

Yes, in a way: it is certainly more expensive, but it is also better established and probably deserves a premium. ACG and DEBT look better value (but they have done for some time).

[ara500] 25/10/2006 15:15

Do you not consider DFD to be overpriced compared to its competitors?

[diogenesj] 25/10/2006 11:20

I just hope old Cawky took the opportunity to bail out of his short without too much loss.

[silverthread] 25/10/2006 09:02

The fundamentals here are strong - rising number of people with debt problems = increasing demand for IVAs = more business for IVA providers including DFD which is market leader.

DFD is not a pariah, but providing a valuable and useful service to both debt-ridden individuals and lenders. If you read how the company operates, you quickly realise that it is very professional and considerate in how it deals with its customers.

DFD had a recent very strong trading update. Yesterday DETS reported very strong profit and revenue growth from the same IVA activity:

Debts.co.uk FY pretax profits rise to 2.1 mln stg from 1.3 mln stg

LONDON (AFX) - Debts.co.uk PLC, the personal debt solutions advisor, said that full-year pretax profits to end-July rose 61.9 pct to 2.1 mln stg from 1.3 mln stg the prior year.

Turnover rose 79.3 pct to 6.1 mln from 3.4 mln.

No dividend was announced.

The company, which was admitted to AIM in late May this year, said that the future prospects for the company are 'extremely positive' and the outlook is 'exciting'.

All bodes well for the medium term for DFD.

[ten] 25/10/2006 08:19

gripfit,

What sort of rocket science did you use to come up with that statement!! Every share that rises strongly will fall at some time or other and will attract other companies if the profits are good. That is called a "market economy", which many of are riding at present in this sector. How about some useful statement or facts, rather than poorly disguised shorting PR.

[gripfit] 25/10/2006 08:06

more dfd type companies entering the mkt ,reminds me of claims dirct etc,this will fall ,when i do not know ,niether does evil kneival ,but it will imho

[chester] 24/10/2006 16:46

Nice continuation.

[chester] 23/10/2006 08:10

Bought a few of these at the open.

[pogue] 20/10/2006 21:32

Banks are summoned to debt summit
A leading debt management company is calling a summit of banks and credit providers to discuss the controversy over individual voluntary arrangements (IVAs), which allow borrowers to wipe out the bulk of their debts.
Debt Free Direct yesterday started sending out invitations to a meeting next month to find solutions to a trend many banks believe is growing too quickly. Debt Free Direct was not available to comment.

The attempt to broker a meeting came as the online bank Egg warned yesterday that it was likely to make an unexpected loss because customers were spending less on their credit cards and turning to debt management companies to control their fast-rising personal loans
continues...............................

[diogenesj] 18/10/2006 09:00

No one could possible suspect you of spamming, 21/11. :-)

[twentyoneeleven] 18/10/2006 08:46

Lol ... sorry if it appears that I'm spamming D! I don't hold all tickers in this sector and thought that others in a similar position wouldn't necessarily read the other threads, so always put relevant news on all concerned. I will be more restrictive in future though ... don't want to appear to be ramping!

[diogenesj] 18/10/2006 08:40

21/11: how about just putting your general posts on one thread, say this one since it is the market leader. Always interesting to read, but not necessarily four times! :-)