Hargreaves Lansdown Share Discussion Threads

[growthpotential] 20/4/2021 15:34

Nice article and thanks for sharing! Hopefully the founders aren't getting twitchy fingers again and can hold the stocks longer(!)

[lomax99] 18/4/2021 06:58

Telegraph today:Questor: Hargreaves is the investment platform to buy as the Neil Woodford effect lingersQuestor share tip: rivals AJ Bell and IntegraFin are great businesses too but their shares are more highly valuedHargreaves Lansdown's shareholders cared more about its involvement with Neil Woodford than its customers did, it seems.Shares in the investment shop stand 27pc below their level just before the suspension of the Woodford Equity Income fund in June 2019, while shares in rival firms AJ Bell and IntegraFin have risen by 10pc and 39pc respectively. But Hargreaves still managed to attract 220,000 new customers last year to take its total to 1.4m.Despite this vote of confidence by the people who matter, investors' apparent anxiety about the Woodford connection has meant that readers who followed Questor's advice to buy Hargreaves shares in January 2017 have made only a modest 24pc, whereas IntegraFin has gained 82pc since our tip in December 2018 while AJ Bell's shares have risen almost threefold over the same period, annoyingly for this column in view of our decision to bank a quick 50pc profit just weeks after our "buy" advice.We did so on the grounds of valuation, although these three companies fall into the enviable category of businesses that can grow sustainably with minimal need for capital and at very high profit margins. This is a potent mix that offers the opportunity for long-term compounding of returns – and there is no better way for patient readers of this column to grow rich. It also means that, within reason, a high multiple of earnings is no reason to avoid the shares.The key attribute of these businesses is that their revenues can grow while their costs remain broadly fixed. Once they have built the platform that allows customers to trade and hold shares and funds, their costs are little more than those of running a call centre.Meanwhile, there are several avenues to rapid growth. These firms make a percentage of the value of the assets that their customers own on their platforms, so signing up more customers, more investment from existing ones and investment growth when markets rise all contribute.There is every reason to expect more customers to sign up. With each year that passes, fewer workers benefit from final salary pension schemes and are forced to save for their own future. Many existing customers naturally pay in more money to their Isas and pensions on these platforms every year, while fewer cash in their pensions in their entirety for annuities following the introduction of the pension freedoms in 2015.America is ahead of Britain in this respect and gives some idea of the scope for growth in personal investment here."About 3m DIY savers invest via platforms in Britain now, whereas in America Charles Schwab has 30m and Fidelity something similar," said Ben Needham of Ninety One, who owns stakes in Hargreaves and AJ Bell in his UK Equity Income fund, while other funds run by his firm invest in IntegraFin."Probably one in five or six Americans invest, whereas here it is one in 20. So there is evidence that the market in the UK is only in its embryonic stages."Platforms can also make money from share dealing commission and from new lines of business such as "active savings" services, which allow customers to move money from one bank to another in search of higher interest rates with the same ease with which they can switch from one fund to another.Share dealing and the savings services both offer ways to attract new, younger customers – customers who will often in time invest in Isas and pensions and start to accumulate large sums.The three firms, two of which, AJ Bell and IntegraFin, update on trading next week, have different mixes of clients. Hargreaves concentrates on individuals who look after their own money while IntegraFin services financial advisers; AJ Bell does both.AJ Bell's shares are most highly valued at a forecast price-to-earnings ratio in the low 40s. Hargreaves is in the high 20s and IntegraFin is in between. AJ Bell's rating reflects greater growth prospects both for the assets it looks after and for its profit margins.Although we sold far too early we don't see a compelling reason to go back into the stock at a much higher price; IntegraFin is a hold but for new money our pick is Hargreaves, whose shares still seem unfairly punished by the lingering association in investors' minds with Mr Woodford.Questor says: buy Hargreaves Lansdown, hold IntegraFinTicker: HL., IHPShare price at close: £16.59, 540p------It's a shame that they do not include a comparison of Gross Margins.......

[robinnicolson] 17/4/2021 14:39

Troy Global Income Fund have initiated a position in HL:

We have established a new investment in Hargreaves Lansdown (HL). HL describe themselves as “the UK’s no.1 investment platform for private investors” which we think is fair. It is an excellent business operating in a very attractive market.

A number of structural tailwinds such as pension legislation, stretched government finances, demographics and increased levels of digital and investment sophistication are leading to a growing number of people taking increased control of their investment lives. As the dominant operator in this industry HL is well placed to take advantage of these trends.

Scale and longevity have enabled the company to build a large, loyal customer base allowing them to invest in technology, delivering excellent customer service. As a result, they enjoy pricing power, driving excellent financial productivity without recourse to debt.

Despite their size, HL represents a relatively small percentage of a growing market. Returns on capital and revenue growth have been declining from elevated levels but remain sufficiently strong for us to regard this as a very attractive long term investment.

We were able to buy the shares when trading at an unlevered 4.4% free cash flow yield. This valuation combined with a clear run way for growth, means we expect good returns for years to come.

The company’s revenues are exposed to the valuation of asset markets which we believe are currently fully valued. As such we have initiated a modest holding which we expect to build up over time.

[ygor705] 07/4/2021 12:43

Have been encouraged by the recent performance of HL and although occasional hiccups are possible, my belief is that the outlook from this level looks reasonable. My view remains that it will be difficult to sustain a case against HL unless and until Woodford is brought to book. The recent flotation announcement by Oxford Nanopore will only lend credibility to Woodford's argument that his portfolio was basically sound. He could even end up sueing somebody himself for screwing up his business! The case against Link could also succeed IMO - they really do look like a shambolic outfit.

[ochs] 07/4/2021 08:31

Thanks for your analysis stockready.

It's good to see the HL share price pick up around end of tax year on the back of the positive trading statement in mid-March (plus AJ Bell's recent positive update). Certainly the shares have been underperforming the US markets by a long way recently - which is strange considering a lot of HL clients invest in US funds, so HL will benefit at the bottom line from those funds going up in value.

The main risk factor at present is the potential for any litigation and is probably holding the share price back from heading toward £20. It would be great if HL could issue an RNS confirming they've responded to the 'letter before action' from RGL and dismiss all the allegations as nonsense.

With regards to Porsche1945 you may not have read all his comments fully after seeing red, but I have noted a number of times that he sees HL as a trading share and has made money both long and short. Indeed he's previously posted that he buys around the £15 level for a quick profit.

[ochs] 06/4/2021 16:06

Hello stockready, got anything of interest to say about HL?

[growthpotential] 06/4/2021 13:10

seriously though, it's around about now that one of the founders suddenly decides to unload

[ygor705] 01/4/2021 16:54

SP showing a bit of strength considering it's the last day of trading for the 20/21 tax year. Interesting article about Link Solutions and Woodford in today's Times. LS do not appear to be the sharpest blade on the investment block!

[growthpotential] 30/3/2021 16:06

How many will the old fart sell(?)

[lomax99] 26/3/2021 16:25

Adding, progressively, from the low 14's...

[ochs] 26/3/2021 14:38

If it breaks below £15 it could get worse than flat I fear!

[growthpotential] 26/3/2021 14:02

Is this stock flatter than the Netherlands

[ochs] 24/3/2021 17:57

Ha, the picture is a bit cringe, it looks like an awkward wedding group shot!

[ccnp] 24/3/2021 14:11

hxxps://www.hl.co.uk/financial-advice

Scroll down to the picture. Bottom row (nearest the camera). 2nd from left. Who does that remind you of? Could it be? He did to go down there more than once to rally the IFAs

[lomax99] 22/3/2021 09:07

A letter before action costs nothing, I doubt an action will actually progress. IMO there is not a case to answer.

[ygor705] 22/3/2021 08:50

The basic fact remains that Woodford himself has not, to date, been convicted in Court of doing anything wrong. Unpleasant as that fact remains it is still pertinent in my view and makes the timing of this move somewhat odd. If Brokers were sued every time that they advised people to buy a share at the wrong time they would have ceased to exist long ago. The case against Link is entirely different and concerns how the actual break up of the fund was conducted by a third party. The publicity surrounding this move will not help the share price but it should flush out just how real this threat is going to be.

[imastu pidgitaswell] 22/3/2021 07:39

Also reported in The Times this morning although it’s a cut-and-paste job from the Mail.

This isn’t really an issue or a story - it’s a letter before action from a no name no-win no-fee firm of ambulance chasers. If there was anything to go for by proper lawyers they would’ve done it before now.

Although I did enjoy one of the comments below the article, referencing the quote in the article:


[“Being part of RGL’s claim gives us real hope of recovering our losses.....”
Its believing that kind of nonsense that got you into this in the first place love]



;-)

[growthpotential] 21/3/2021 22:31

A minor inconvenience, we expected this at some point and for it to be discussed officially. HL should respond professionally and explain that there really is no case here

[ochs] 21/3/2021 20:29

This story could hurt on Monday morning... and not one of the companies I've seen advertising on fb either. Apparently they've sent a 'letter before action' and RGL will expect HL to respond by the middle of April.

[ygor705] 21/3/2021 17:04

I broadly agree with the comments made here but I cannot support Neil Woodford. As an investment professional, he must have known the risks of straying too far into the realm of illiquid investments with the kind of vehicles that he was employing. Quite why he chose to break a very basic investment rule is a matter of conjecture but it was the structure of his vehicles rather than the choice of investments that killed him imo. Pure mechanical failure.

[ochs] 21/3/2021 15:38

Yes, Woodford has stated that himself in recent interviews... he believes that if he'd been allowed to carry on managing the fund he would have ridden out the storm to the benefit of his investors. This may be true as some of his stocks did recover, but it might not have been enough, and he would still have been stuck with too much unlisted (mostly) junk.