Gsk Share Discussion Threads

[buoycat] 28/3/2018 13:56

Not sure how holding GSK over last three years would have contributed to a doubling in your fund size woodhawk. My investment here has certainly grown handsomely over the last ten years but a lot to do with reinvesting that divi.

[nigelpm] 28/3/2018 12:58

Because he's clearly very good at picking stocks with terrible balance sheets so actually anything he holds one should be extremely careful about - IMHO.

[anhar] 28/3/2018 11:59

Why be concerned with what Woodford thinks or does? (Or any other fund manager)

[woodhawk] 28/3/2018 11:49

Woodford, who needs him? The funds under my management have more than doubled over the last 3 years. Mind you, I have the advantage of scale - small scale (albeit twice the size now)! For this I largely have to thank my investments in GSK, GVC, LGEN and HGM (Strangely, I've just noticed all 4 have a 'G' in their code... perhaps this is the answer!?).

[nigelpm] 28/3/2018 11:46

Exactly RCTurner - his inability to read a balance sheet is the main issue of late.

[ygor705] 28/3/2018 10:10

In my view, Woodford is no fool but he is just as susceptible as any of us to the greatest problem with investment ....... timing. In my view he jumped ship too early here but that may have been driven by frustration and the perception of better opportunities elsewhere. Who knows but it's what makes the market.

[nigelpm] 28/3/2018 09:22

no, Woodford's reputation has been utterly trashed recently - I wouldn't listen to him on anything right now.

[tradermichael] 28/3/2018 09:04

Cannot agree that yesterday's deal is any kind of representation of Woodford's mistaken views. The added stake is earnings accretive and sustains investment in the pharma business.

[imastu pidgitaswell] 28/3/2018 09:03

Might also take a while to get through 1360-70, the wider market notwithstanding:


free stock charts from uk.advfn.com

[ygor705] 28/3/2018 08:46

Yesterday's deal has brought some interesting press comment including statements that Glaxo's current debt to EBITDA number is around 2 and Emma W wanting to test shareholders on how much further she could go on the debt front. In my experience (a little dated now) most banks would not go beyond 5.5 debt to EBITDA and were more demanding on the stability of cash flows as the starting number got bigger. They also liked to see projections showing the number tailing off pretty quickly. Given GlaxoSmithKline's financial underperformance over a protracted period of time (read Neil Woodford article in the link below) I can't believe that shareholder's are going to be happy stretching the balance sheet much further until there firm evidence of a lasting improvement in cash flow. Strangely Woodford's break-up request may be happening but in a slightly different way to what he wanted. Selling one set of assets to buy another achieves the same aim.

[mj19] 28/3/2018 08:36

https://www.fool.co.uk/investing/2018/03/27/why-id-buy-6-yielder-glaxosmithkline-plc-for-my-isa-after-this-news/

[dr biotech] 27/3/2018 23:11

Hard to know whether we bought the consumer division at a decent price without knowing what it made last year or the growth etc. I'd love to see a comparison with what we bought and what pfizer offered. Either way it should offer "clarity" going forward, and hopefully a sustainable and in time rising dividend yield.

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Buywell/Abdul/Monty + others on filter. Why waste your life on their lightweight drivel?

There are far better posters - ie whilst I disagree with 95% of what Anhar says at least its a constructed argument.

[tim 3] 27/3/2018 21:36

Big sell off on the Dow tonight lets see how they weather a FTSE drop in the morning.

[badtime] 27/3/2018 21:04

Abdul quiet today......but then we have buywell so not all is lost

[romeike] 27/3/2018 19:59

I think they did sweeten it by 200-300mil. And in fact GSK have bought it at the bottom because the Novartis stake was only going to get more expensive as time went on. The fact is it isn't simply the cost but the removal of the uncertainty that is good. Now GSK has a clear run at improving shareholder value.

In can see them spinning off Consumer as a separate company once Pharma is back on track.

[buywell3] 27/3/2018 18:57

Deals ... CEO's just luv em

Novartis getting rid at near the market top

[essentialinvestor] 27/3/2018 18:21

The vaccine guys were adamant large cost benefits derived from being part
of a wider pharma group, an eventual consumer spin off I can see the rational.

Today's news is so much better than a PFZ buy, a cynic may say Emma played
an astute game and the intended target was always full ownership of the JV,
and not PFZ. Yes NVS could have exercised the put, however GSK may have
sweetened the valuation to make it happen.

[alphorn] 27/3/2018 18:15

#142/143. Thank you.

Article is so/so IMO. He alludes to the point that I posted above about Big Pharma having to run to stand still. That is life. Others know the science and its difficulties better than me for new projects.

If I was going to have a bet only one arm would be spun off. If it ever happened.

[fangorn2] 27/3/2018 17:23

Some HL comment in case anyone interested.


Our View
The acquisition of the outstanding consumer healthcare stake comes six months after GSK's new CEO announce sweeping disposals and plans for £1bn of cost savings.

These measures are underway, and initial signs are good. The savings are being channelled back into R&D across the new target therapy areas - Respiratory, HIV/infectious diseases, Oncology and Immuno-inflammation. Given that GSK's recent batch of "new" products now account for 22% of revenues and are growing rapidly you can see the attraction.

The steady decline in revenues from Advair has been painful. However, with rivals struggling to get a generic version past the US regulator, the respiratory blockbuster is holding up better than expected. Nonetheless, the looming increase in competition remains a time bomb ticking under the group and at some point will inevitably blow a hole in the GSK income statement.

However, the varied portfolio has been delivering broad-based growth in recent quarters. In particular the increasing contributions from the Consumer Healthcare and Vaccines divisions (now over 40% of group sales combined), should reduce reliance on blockbuster drugs and strained Western healthcare budgets.

It's a sensible strategy and the recurring revenues should help support the dividend.

On that note, the commitment to hold the payout flat next year will have caught the eyes of some investors - following speculation that it could be sacrificed in favour of a big Consumer Healthcare acquisition from Pfizer or Merck. The deal to buy out joint venture partner Novartis will put those rumours to bed for now. At present GSK offers a prospective yield of 6.2%.

Going forwards the focus is firmly on improving free cash flow. Given the recent problems GSK has had in that area, this is very welcome. Free cash was less than 40% of core operating profits last year and didn't even come close to covering the dividend expense.

GSK has some way to go before it's fully out of the woods, but early signs suggest the new CEO is willing to make the tough decisions when required.

[essentialinvestor] 27/3/2018 15:20

Alp, 4 way split in a nutshell, ViiV, consumer health, vaccines, legacy pharma.

[nigelpm] 27/3/2018 15:20

Woodford dumping should make one consider buying I'd say.

[alphorn] 27/3/2018 15:15

Do you have a quick link to his ideas please?