Dignity Share Discussion Threads

[lovelyjubbly] 05/7/2006 11:09

I think India's understanding of the situation is the same as mine.
With 7 new shares for 9 old ones my holding would have been worth practically the same. I assume that is why 7 for 9 was chosen so that the share price will not be affected too much which I guess is what the shareholders want...

Must admit I sold yesterday - made a nice little profit and (sorry if this offends) will hope for another buying opportunity around the 450 mark if it happens. The cashback seems to have no benefit to the shareholders or the company? Why take on all that extra debt when there was only a need to borrow £10M to sort out the pension? It seems slightly suspicious to me?

Good luck all anyway - it's a good company and I hope I will return...

[melody9999] 04/7/2006 21:37

Hmmm - as a holder now, think I'll just continue to do what I have done - continue to hold on basis of company's excellent management, fundamentals and performance. Despite some uncertainty around the £1 offer, the share price is hitting new all time highs. For me that only means the share price will increase further when the uncertainty is removed - but maybe I'm being over-optimistic!

[davpat] 04/7/2006 19:09

Thanks for that india93, helps my thick head get round it better. The only DTY market news that interested me of late was the panmure gordon research note of 9 june raising target price from 520 to 565 (my thread 474). Since these kind of things can be subjective and not always worth following I'm still not convinced just yet. This is really a long hold share that will always puzzle, but isn't that what life (sorry, death) is like anyway? I jest but do not mean any hurt.
DAVPAT

[india93] 04/7/2006 16:28

My understanding of this is:

£1 * each share we have
7 new shares replace 9 old shares.

At current levels of £5 a share and 900 share in hand , i would be replacing £4,500 of value with:

a) receipt of £900 plus
b) 700 new shares worth £3,500 (at £5 a share)

a loss of £100

i would be better to sell now unless the new share price after the 7 for 9 reorg. is better than £5.14 a share.

I presume the market will price this in and value accordingly and i presume the company will hereby reduce its cost of capital and be able to increase our dividend payments , however its hardly giving it away !!

Does anybody have a different view ?

[davpat] 04/7/2006 14:15

Now we have an all-time high....even more interesting/puzzling. Must say I'm itching to add. But agree M.T. traders are everywhere.
DAVPAT

[m.t.glass] 04/7/2006 10:50

I too am puzzled about how this particular style of cashback move will impact the share price before and after it happens..

I have no position at present. From a trader's point of view, is it advantageous to climb onboard ahead of the August date and exit thereafter? From an investor's point of view is it worth staying out and buying in after? Or the opposite? (Subject as ever to whatever other market movement is happening).

[davpat] 04/7/2006 08:51

>LJ...Must admit I'm puzzled, mainly because this 'giving back cash' is new to me, and as such makes me sceptical. What must be important at the end of the day is no matter how many extra shares I get do I get extra value? Answer, as always, don't know, purely in the hands of the amount of punters who cash in?
Was thinking if topping up, can't see the point now.
DAVPAT

[woodsman2004] 03/7/2006 13:04

I first bought these in June 2004 and eventually cashed in my chips in Dec 2005.

I have been waiting for a retreat in order to get back in....so far no luck. As mryesyes says, one year they might make a loss (they have a lot of debt) and I may get a chance.

Incidentally, the current heatwave is a bonus to them as it will start to clear the "death rate overhang" - my family are in the nursing home business and this weather is very bad.

Investors looking for another "sleep at night" stock which is in more of a growth phase should look at CTH who provide residential care for people with disabilities.

[lovelyjubbly] 03/7/2006 12:28

Well, they have announced the £1 per share payout in cash. Wonder why they didn't just do it as a 'dividend' which is what it is effectively isn't it? And I assume that will mean £1 suddenly taken off the share price when it goes 'ex-div' in early August? Not that I am worried - it looks a good safe long term hold for the portfolio...

[melody9999] 26/6/2006 09:11

MYY - DTY is a sleep at night share - IMHO is a great share to be part of a long term investment portfolio. Why? Sound business model, good management, increasing turnover. When volatility hits the market place, DTY is also a safe haven - there may be opportunities with lower PE elsewhere at present; problem is they might also lose you more money in the short term.

Technically also building a very nice base here at 480p

[mryesyes] 13/6/2006 17:11

Dignity's future returns are dependent on business performance, and it is currently well overvalued in comparison with opportunities now available following recent falls across the market.

[davpat] 09/6/2006 10:05

Ive just found a Panmure Gordon 'buy' note issued 06 June on newratings.com:
"LONDON, June 6 (newratings.com) - Analysts at Panmure Gordon & Co maintain their "buy" rating on Dignity (ticker: DTY-GBX). The target price has been raised from 520p to 565p.

In a research note published this morning, the analysts mention that the upward revision in the target price reflects the impact of the company's cash flow generation potential, which is undervalued. Although Dignity's future returns are dependent on business performance and interest rates, the expectation of an additional £80 million in returns to shareholders in the forthcoming five years is realistic, the analysts say. The company is likely to generate 15% EPS growth in the forthcoming few years, Panmure Gordon & Co says."

I'm a bit puzzled as to the reference that the returns to shareholders will be over a five year period. Unless I missed something I thought the returns were to be over this financial year. From the May 2006 Annual Report....."It is the intention that shareholders on the companys register at the end of business on 01 August 2006 will be eligible to receive B shares which will be redeemed on 03 August 2006.

[davpat] 09/6/2006 09:47

Melody - I've just sent an email off to their investor's office. Maybe hear something that way. There's nothing indicated on the Company Financial Announcements website I use.
DAVPAT

[melody9999] 09/6/2006 09:35

any news from the AGM anyone?

[davpat] 07/6/2006 14:29

Llados - thanks, forgot that, watch carefully then tomorrow.
DAVPAT

[llados] 07/6/2006 12:35

Its the EGM and AGM tomorrow, so might account for the interest today. The Company are proposing to return £80 million to shareholders in August, see their website for details. Llados.

[davpat] 07/6/2006 09:59

melody - like you I'm slightly puzzled, although it never fails to amaze me how the market can resume its frothyness so soon after a previous major correction. A firm end of day closure at or above the new high for consecutive days is a better indication to me. But we'll never know what and why MM's mark up the way they do in these circumstances. Mustn't grumble though.
DAVPAT

[melody9999] 07/6/2006 09:39

absolutely davpat - looking good now - but I am a bit dazzled by the blue amongst a sea of red - close above 480p has to be very bullish..... there won't be a lot of stocks hitting new all time highs at present - and with stop losses being hit elsewhere, you would expect further share price movement - but thats only my thinking.

[davpat] 07/6/2006 08:58

melody9999 - might this just be the push then? I think we have a breakout here at last. Even more tempted now to push that buy button. Volumes low though.
DAVPAT

[melody9999] 05/6/2006 13:16

Davpat - needs a good push to take us through congestion at 470 / 480. But because we've been stuck here for a while, could then rise by 40pts quite quickly. Don't think any specific activity but also do not think anyone has noticed the steady progress DTY is making...... and the AGM this Thu 8/6 might just provide the impetus.

[davpat] 05/6/2006 09:45

Appears to be enough healthy interest in this stock now to allow a decent share price recovery from recent general market retraction. But volumes are small. Anyone know of any specific company activity for this, or are we just seeing the stock being viewed as a good defensive play? Am itching to add to my holding but can't quite yet 'push the button'. Did the IC buy advice have that much influence, Comments anyone?
DAVPAT

[melody9999] 19/5/2006 08:50

no great surprises there then. but a bit worrying!

[m.t.glass] 19/5/2006 07:36

Selected as a 'BUY' in Investors Chronicle today