Future Share Discussion Threads

[squitter] 10/12/2020 11:08

This sounds similar to the scaremongering Stockviews was doing in July 2019, but on even thinner ground. So: "questionable journalism" and a comparison to a completely different company whose share price collapsed a few years ago, means we should all be wary of investing in Future, despite its stellar financials and a proven track record?

[elmfield] 09/12/2020 17:33

You better keep away then,

[energeticbacker] 09/12/2020 10:24

Future has wowed the stock market with stunning growth since a change of leadership and strategy in 2014.

But will its somewhat questionable journalism and diversified revenue model still continue to deliver as its audience becomes more discerning?

New analysis on Investor's Champion website, which states: "We are somewhat wary of management compensation structured around acquisition activity, which appears to be the case with Future. We saw this before with Conviviality, which ultimately turned out very badly for shareholders."

[ihatemms] 01/12/2020 07:58

Nice director buys

[lomax99] 30/11/2020 10:51

It is well worth taking the time to listen to the results presentation, which also covers the rationale for how Goco enhances FUTR's overall monetisation offer.Https://webcasting.brrmedia.co.uk/broadcast/5fb24649be1fd642a3ef1d09

[ramridge] 30/11/2020 09:43

Thanks lomax99, for this bit from Questor.
I tend to agree with him, on balance I would consider it a speculative buy.
My take is that if they can use their current platform to squeeze out GoCo's costs, we will be looking at very healthy operationally gearing. They have done this before and there is no reason they can't do it with this acquisition.
I have gone long with an entry stake.

[ayl30] 30/11/2020 09:08

Looks like a better day today. Investors warming to the deal perhaps?

[bulldog67] 29/11/2020 17:41

lomax 99

Thanks for posting a compelling and informative article

[lomax99] 29/11/2020 06:56

Questor: is Future just a takeover junkie or can it make this GoCompare deal work?Questor share tip: as fund managers argue about the logic of the bid, we look for evidence of the management's underlying abilityNothing divides opinion in the City more than a takeover bid. When the bidder also has a controversial past, the debate becomes even more heated. So it has been in recent days over the proposed acquisition of GoCo, owner of the GoCompare price comparison service, by Future, the magazine publisher.Questor canvassed opinion about the deal from a number of fund managers and analysts. There was little sign of consensus."This deal is less left-field than it initially appeared," said one fund manager who owns shares in both companies. "There is an awful lot Future can do with GoCo. The bid was a surprise but after we had spoken to Future's management, we were comfortable with it."But another fund manager decided to "short-sell" Future shares after he heard of the takeover. "Nothing about this deal makes any sense," he said."The conference call [with Future's management] was very odd. Searching for the logic of combining her company with a price comparison outfit, the best defence that Zillah Byng-Thorne [the chief executive] could muster was that GoCo was for sale, also founded by an entrepreneur and handily just down the road in the South of England."To be fair to Future, its statement did include rationale such as the scope for "creating a leading global specialist media platform that drives intent", adding "key capabilities and adjacent routes to monetisation", and "substantially growing the addressable market", although this column would have preferred to see more English and less jargon.Why does Future arouse such strong and conflicting opinions? It is because of its takeover habit.The firm has grown extremely quickly: when Ms Byng-Thorne took over in 2014, its market value was less than £100m but it was almost £2bn before news of the acquisition sent the share price sliding.That growth has been driven by repeated acquisitions. Future's backers say the firm's record of growth in profits speaks for itself. Its detractors counter that the businesses it acquires do not prosper under its ownership and that the only way to maintain growth is to buy yet more businesses. Sooner or later, they say, the music will stop.On the whole, Questor regards itself as a takeover sceptic. However, the occasional serial acquirer does make a success of it. RWS, the patents firm tipped here in the past, springs to mind.Let's seek some evidence as to Future's success as a buyer of businesses. We were struck by a quote from the first investor we mentioned.Referring to Future's previous acquisition of assets from Centaur, another publisher, he said: "Within no time, Future had made huge amounts from these assets that Centaur hadn't been able to make for one reason or another. We owned shares in Centaur too and we were staggered by the amount of money that Future was able to make from its former assets."He added: "I think Future will make the GoCo purchase work – it has a fantastic record of execution."One complaint made by those who dislike repeated acquisitions is that they can make financial results hard to interpret. Like-for-like comparisons become more difficult and there can be acquisition costs, the writing off of associated "goodwill", and problems with disentangling organic growth from acquired growth.We will try to look through all that complexity to get a sense of where Future is going. Conveniently, it announced results for the year to September alongside its offer for GoCo. Everything was up: sales by 53pc, operating profits by 90pc, profit before tax by 309pc, cash from operations by 71pc and earnings per share by 388pc.Now, as Terry Smith, the respected fund manager, has said, it's easy to grow returns if you deploy more capital. Has Future thrown capital at these returns?The number of shares in issue has grown this year, but by a relatively modest 16pc, while net debt at the end of the year was 54pc higher than a year previously. Strong cash generation is eating away at these debts. Even when we take that extra capital into account, Future's growth is impressive.A good business, then. But a good investment? The shares trade at about 22 times earnings – reasonable for such high growth. But a lot depends on this latest acquisition. A risky buy.Questor says: speculative buy

[capitalist] 27/11/2020 07:37

looks to me like the shorters decided to close some of their short positions when the usual "sell on news" brigade turned up. I see this as a positive for the future. DYOR

[alphabeta4] 26/11/2020 19:59

Interesting, they can't have thought the report and acquisition was that bad then.

[ihatemms] 26/11/2020 17:57

Shenanigans from the shorters yesterday to deliberately pummel the price even though the results and presentation were superb.Bought back 800k shares

[elmfield] 25/11/2020 17:45

Well, zillah, she has got things right more than wrong,
Time will tell.
Lots of goings on when there are shorts opened etc,

[aquaesulis01] 25/11/2020 16:05

Telegraph view on the acquisition: It’s not over 'til the fat man sings. How apt then that a deal to unite magazine house Future Publishing with the comparison website famous for its irritating adverts featuring a fictional Italian tenor will leave shareholders scratching their heads.

Investors in Go Compare probably won’t have too many complaints about a part-cash, part-paper deal that values the company at £594m. Future’s 136p per-share offer is a 24pc premium to the previous day’s share price, or 33pc if you take the three-month average. And 138p is the highest it ever reached, back in June 2018.

But as for what the publisher of eminent publications such as Practical Caravan and Guitar World wants to do with a price comparison website, well you won’t find too many clues from a company content to waffle on about how the tie-up will strengthen its “proposition of seeking to address the growing consumer demand for informed and value driven purchasing decisions”.

Ditto how “the combination of Future's deep audience insight with GoCo group's expertise in price comparison” is a “truly unique opportunity”. But then again, this is an outfit that boasts on its website about being an “experience-maker”, whatever that means.

A whopping 17pc fall in Future’s share price is much more revealing. The truth is that combining publishing and price comparison sites is not a new idea and the results have been mixed at best. German publishing giant Bauer owns several platforms across Europe but its private ownership makes it difficult to assess whether it has been a successful strategy.

A better example might be the short-lived ownership of Uswitch by American media conglomerate Scripps. Having parted with more than £200m for the fledgling website in 2006, it racked up heavy losses and Scripps offloaded the business three years later for just a few million pounds.

There is an unavoidable suspicion that the deal is a de facto retirement vehicle for Go Compare chairman Peter Wood, not helped by the fact that Future boss Zillah Byng-Thorne is also on the board of the company she is buying.

Though Byng-Thorne has been excluded from the discussions in her capacity as a Go Compare independent director, the connection doesn’t look great.

Wood’s 29.6pc stake will earn him another £180m to add to an estimated £800m fortune, assembled from the sale of insurance brands Direct Line and Esure, which Go Compare was spun out of in 2016.

Meanwhile, further questions will be asked about Byng-Thorne’s seemingly insatiable appetite for deal-making in her capacity as Future chief executive, and whether she needs to keep the acquisitions rolling in order for the company’s impressive growth to continue.

After all, it is only a year since the £140m takeover of TI Media, a deal Byng-Thorne celebrated by offloading £14.6m worth of shares just weeks later. The ill-timed sale triggered an 8pc fall in Future’s share price as investors asked whether it was a sign that her faith was wavering.

Future’s transformation from troubled publisher of forgotten print publications to one of the UK’s hottest media companies has been an unlikely one but perhaps it really has worked out how to make money from digital publishing.

City forecasts have been repeatedly smashed and its share price has rallied strongly from Covid-inspired lows of just 42p in March. But this giant leap into unknown territory will be the biggest test of Byng-Thorne’s dizzying six-year reign yet.

On the bright side, she has come under fire for being “overboarded” – City speak for being on the boards of too many companies at once. This deal at least helps address that little problem

[investing2retire] 25/11/2020 15:23

Im glad i closed my position in FUTR at 1946p in october (bought at 1200p)

[daveme] 25/11/2020 13:07

The share price drop seems a tad extreme to say the least! After market expectation beating results I can only conclude the drop relates to the GoCompare acquisition. I can't imagine the deal is that bad so I suspect it is due to GoCompare shareholders selling/shorting FUTR shares so as to crystallise the cash portion of the deal. When the deal goes through they will get the FUTR shares back leaving their position unchanged.

Consequently I suspect things might be volatile for a short while before, hopefully, the share price climbs back up to where it started before the GoCompare announcement.

[wanttowin] 25/11/2020 12:16

Looks like this is heading to £15 imo, I am looking to buy in and watch with interest.

[mallorca 9] 25/11/2020 10:48

Just bought in.

[donald pond] 25/11/2020 10:01

The drop in FUTR share price today wipes about 9/10p off the amount GOCO shareholders receive. That could be a problem

[kenmill1] 25/11/2020 09:57

Perhaps it is the GoCo acquisition. There may be a number of GoCo shareholders who don't want to hold on to Futr shares or Futr shareholders not agreeing with the acquisition. On the face of it, it seems OK as it is claimed to be earnings enhancing but who knows.

[gemmaqiu12] 25/11/2020 09:34

The market is irrational! Time to add more?

[horburyjunction] 25/11/2020 09:20

squintyflinty - probably a bit of profit-taking?