Fletcher King Share Discussion Threads

[bigmolly] 20/1/2008 21:27

I bought a few this week yet they didn't show up as yet as trades, no doubt someone has plenty on their book.

[kunalkoth] 13/1/2008 17:49

I see what you are saying - I probably mistimed my purchase but I guess there is some comfort in the fact that FLK has been in business for many years and has ample cash. Just have to stick with it now...

[ydderf] 09/1/2008 15:55

the trouble is that this is an illiquid share and when the rest of the market is falling and it isn't, its because of that, not prospects - take a look at the other agents and you will see they make flk look very dear indeed - as soon as a few holders can be bothered to sell on an unwilling market, they will be sub 30p crookney!

[kunalkoth] 02/1/2008 19:46

Nope just people spotting pretty good value. Property freeze nowhere near thawing.

[supersturrock] 02/1/2008 11:46

SP telling us that property freeze is beginning to thaw ?

[churchill2] 21/12/2007 16:12

There are only 9 million shares in operation so that makes you a major shareholder. You will be telling us next you are going to make a bid for the company.

[ydderf] 21/12/2007 11:21

I bought these a few years ago at 16p and 18p - at the bottom of the last cycle - I was able to pick up a million at a time then.......just shows you what can happen when the going gets tough - why not wait for 20p in a year or two?

[supersturrock] 18/12/2007 10:46

Strange that they warned on the final divi but hiked the interim by 50 %.

[churchill2] 18/12/2007 09:34

Hi ydderF

You have hit the nail right on the head. Shareholders will come some way behind the payments to Directors and Staff.

This is not a critism but a fact of life (see my post 339). A great share to own when the property market is going in the right direction. After saying that it does look good value at these levels and David Fletcher may want to call it a day at some point.

[kunalkoth] 18/12/2007 08:44

This is true...

[ydderf] 18/12/2007 02:50

kunalkoth - valuing as annuity is fine for a gilt or hypothetical asset, however there are too many other variables, affecting the valuation of a live business. the poblem with flk is that it is a tiny operation with high fixed costs (salaries) with micro metrics any of which could be ovrwhelmed (as they have in the past with flk) by external events....my guess i that you are another poster who has yet to experience a true bear market?

[kunalkoth] 17/12/2007 23:17

A discounted cash flow study shows that, based on a WACC of 7.5% and terminal value growth rate of 3%, the current 50p market valuation of Fletcher King is assuming net cash flows of just £100k for the next 5 years and a 3% growth rate to perpetuity.

In short, this business is very undervalued by the market considering that last years net cash flow was about £900k and the year before that about £200k. Market has priced in one hell of a property downturn.

If you look back all the way to 1998 you will see that this business has never actually made a loss on operations and has always been cash flow positive. That said it has been cyclical, so I am assuming this is near the bottom and will be a buyer in this market.

[pepi moon] 17/12/2007 13:48

at the moment its more like 7% even for more speculative investment - probaly by december next year 6% - FWIW my high street bank are quite happy to lend and actually had them call me for the first time ever to offer me money, must be desperate to lend money as I am just a little fish.

[mdchand] 17/12/2007 13:05

ydderf - as someone who puts together commercial property funds I have a wee bit of experience on subject. As I said before, when your tenant is the RBS, you can get reasonably good levels of finance from RBS, as they're lending against themselves. However, getting fixed lending on 80bp is the exception rather then the rule.

[ydderf] 17/12/2007 12:24

mdchand - finance costs of 6%? what planet are you on my friend? lol

[battlebus] 17/12/2007 11:37

As always property is a long term play.

[its the oxman] 17/12/2007 11:15

tempted to buy myself but already have exposure elsewhere and these property plays just keep falling - agree its overdone but just can't win against the gloomy sentiment - that said if you can stomach further falls and hold for a year or two...

[mdchand] 17/12/2007 11:07

Its worth remembering that against the current back drop of doom and gloom, approx £5bn has been raised by large institutional commercial property managers to re-enter the property market in 2008. Like most assets, commercial property is very much sentiment driven, but underlying the asset is usually a rock solid
income stream. For example, in today's distressed market, you can pick up properties tennanted by the like of RBS at a yield of 7.5%. Remember that the cost of debt is approx 6% and you have an asset that is self-financing. Now, your probably going to point out, whose going to lend, but the market for asset lending still exists for quality tenants on a decent lease. Would I buy now...probably not as market sentiment has probably yet to bottom, but Spring next year....far more tempting.

[win2003] 17/12/2007 11:04

IMHO the fall is way overdone, the question is whether to buy some more.

[barn owl] 17/12/2007 10:15

Oh well, looks like my long-term punt on 23/11/07 will take even longer now!
Good luck all.

[cockneyrebel] 17/12/2007 08:29

yep, phrased well Frauddy, you admit it that statement that it's a rarity.

If I had a pound for everytime you've forecast the end of the world over the past 4 years while you sat on your cash and bought property in Germany lol.

Back to zee bunker mine flower - you're as good at making market calls the Labour party is at telling the truth.

CR

[ydderf] 17/12/2007 07:13

crookney, looks like i was right and you were wrong this time......as a matter of interest, are you going to be able to adjust your speed to take account of driving conditions, or will your backward looking portfolio take hit after hit?

[ydderf] 14/12/2007 14:16

fantasy rally my friend - properties and all the service providers are going DOWN!