Seneca Growth Capital Vct Share Discussion Threads

[edmondj] 27/8/2004 15:08

I agree; the chronic lack of interest in a "recovery to growth" share means it languishes at a discount to underlying value. Wrestling with this dilemma around interims I decided that if the price continued depressed it would eventually prompt a bid. I confess however that in recent weeks my thinking has been that other operators might wait to see how the cycle evolves; if things become tougher. But clearly there is value in spades, in Swaylands etc, at the current share price.

[ukhawk] 27/8/2004 14:52

Surprised there's not more interest in Honeygrove. They're now in play and one or two others will be doing the sums and looking at the potential.

[edmondj] 27/8/2004 13:03

Agreed, that is impossible, also because it's a function of management ability to enhance value via developments + ultimate selling prices in a housing market we can but speculate upon.

[barryrog] 27/8/2004 12:55

greengiant,
i reckon the true NAV will be impossible to compute accurately.
current balance sheet is showing £10m,after taking off negative goodwill of £2.1m but the major assets are the land bank and unsold properties.
the land bank has been valued at cost and this for swayfields alone is at least £7m below market value;you have to assume the same situation exists for the rest of the portfolio.in addition,i suspect the unsold properties are valued at cost as the profit is only booked on the completed sale.
just adding in swayfields would give an NAV of 13.4p per share, a revaluation of the total could be at least 18p per share.

[edmondj] 27/8/2004 12:40

Filed detailed comment to Citywire a couple of hours ago; have chased up what they are doing with it if anything.

[greengiant] 27/8/2004 12:27

Sat5 - Was in ASC at 7p, then for some bizarre reason sold out at 15p (LOL!) Been on radar ever since.

Will post sometime this weekend.

gg

[saturn5] 27/8/2004 11:40

gg
I too will wait for your details. and details on any other shares.
I have held Propan Homes for some time and bought at twice the present price.
If you are not aware of it already take a look at ASC. I reckon there is going to be money made here as well.

sat5

[greengiant] 27/8/2004 11:29

Barry - Not a rushed investor, take my time and pick my shares carefully. Will post greater details of my workings (whether right or wrong) tomorrow. Happy to hold, not looking for a short term gain, although it may be forced that way.

Got into here because of the level of turnaround I would expect on Profits and on a NAV play.

gg

[barryrog] 27/8/2004 11:11

greengiant,
'd like to maintain a dialogue with you on here as you seem to be one of the only serious investors on the thread who has bothered to do proper research and analysis into the co.
i did in fact pick up 20,000 shares on wednesday,hence my coming on to the bb.
i am primarily an investor not a trader and i bought these on wednesday after speaking to a friend of mine who came over from Canterbury and is already an investor.i would have bought more but am reluctant to sell out of my portfolio which is doing really well.incidentally,he was not aware of the potential takeover otherwise i'd have acquired a significant slug but i will top up in the near future.
i did some initial research at the time,liked what i saw but was a bit concerned that the stock seemed very illiquid and the price was being influenced by small sells from short term 'lemmings' that was keeping the price very static.
since then ,i have taken time out to do some in depth analysis and the more i read,the more the co. looked like a potential takeover target. incredible assets but equally incredibly high gearing,although i can see the co.are actively taking steps to reduce this.i wasn't aware of the building problems identied by Derizzo but i am an investor not a house buyer.
there have been points raised on the thread about non performance which is quite true in respect of the share price but not,in my opinion the company itself.
the acquisition of Honeygrove looks like a steal to me and adopting their accounting policies,i.e only booking profits on legal completion of contract sales was bound to effect the co. in the short term.
it appears the co. is very confident of its projections for this year of 3.1 eps which,when you consider the dilutionary effect of the share placing is a significant achievement.the proposed divi of 0.6p per share is a terrific yield and is covered 9 times by forecasted profits.
without the potential takeover a fair price for the share seems nearer 15/20p looking at the assets and the future growth prospects. as i said in my earlier post, i am sure that mgt wouldn't sit round the table to discuss less than 20p.
good luck as a holder.

p.s.
edmund, tip sheets,in my opinion, do nothing more than bring a co. to your radar screen for research that hitherto you may not have considered.
unfortunately so many punters rush out and buy without proper research the share price soars and then existing shareholders sell to realise profits.the share price falls and the new buyers start to panic sell,normally at a loss.
go back and ask Shares Magazine about FEI,GBG,RTD and some of their other gems they have tipped this year.
no offence meant,i am not inferring you are one of these.
just expressing a point of view.
rgds.

[greengiant] 27/8/2004 08:45

Bought another 15k for fun. I'm happy to sit and wait.

gg

[edmondj] 27/8/2004 08:43

bleedin' obvious!

[barryrog] 27/8/2004 08:42

Edmond,
its patently obvious that RAB are part of the discussion

[edmondj] 27/8/2004 08:39

barryrog,

With a hedge fund owning a third of this company, on a fully diluted basis, does a bidder even need to talk to management?

RAB is in at 10p and needs to deliver performance in its second half. The writing is on the wall for Honeygrove.

[greengiant] 27/8/2004 08:36

barryrog - People taking profit - can't blame them, but NAV plus Profit post cost savings states that this has got to be a post 20p bid. The company stated that it had an approach for the Swayfields site @ £14m, which equates to the whole market cap for this site alone. Will top up.

gg

[barryrog] 27/8/2004 08:34

aderemi,
it was an RNS, not just a rumour.
this would be loose change to one of the big boys

[barryrog] 27/8/2004 08:32

greengiant,
what are these people up to?
do they really think a potential bidder is going to offer no more than a 10% premium to thursday's closing price.
christ, the management wouldn't even begin a discussion below 20p.
rgds

[aderemi] 27/8/2004 08:31

I am playing this via RAB capital who already have a stake. Too much risk - I am doubt ful about an offer been made plus there was no need for the annoucement yesterday, the reason the share went up was because it was tipped in Shares Magazine as a top 10 aim pick. I think the company could have missed that.

[greengiant] 27/8/2004 08:20

Neither can I - Worth well over 20p IMHO.

gg

[barryrog] 27/8/2004 08:11

i cannot believe that people are selling out at 11.5

[edmondj] 26/8/2004 22:12

Were the Insinger de Beaufort forecasts realistic? Possibly, if the top-end market is holding up. It bothered me that (apparently) just a few reductions on Tunbridge Wells properties, to clear the last ones off the books, meant interims that suggested Honeygrove was unlikely to meet projections for the year to end-September 2004. Insinger 'downgraded' slightly but I felt if this were a larger company the broker would have cut more seriously and the company warned. Honeygrove could still meet revised numbers but I've recently felt it's touch and go according to projects timing. More positively for exacting a return, this has made the company more vulnerable to an offer. As I've said in columns, it has a good spread of projects + land bank. With nerves growing on the prospect for the housing market (especially upper end) and a hedge fund owning nearly 24% of the share capital, now is a shrewd time to bid. Given the financial record enough people may feel they don't want to tough this one out - but sure, long-term, someone should be able to exact value.

[barryrog] 26/8/2004 21:51

i can't understand why all you shareholders aren't jumping up and down on this thread.
cos. get taken over on average at 10 times forecasted earnings which in this case would be 30p per share.add to that the land bank/stock valued at over £40m less creditors of approx £30m, i.e net £10m (and by the sound of it grossly undervalued), you could be looking at 40/50p per share!

[barryrog] 26/8/2004 21:00

Derizzo,
can't just be a rumour,its a regulatory release.
sounds to me like the directors have been working towards a takeover as they turned down an offer of £14m for swaysfield (which is twice its book value)in order to (supposedly) develop it themselves.
christ,sounds like a hefty premium is likely as this years profits are forecast at £5.4m,next years at £8.8m and the swaysfield profit(estimated at £15/20m) was not due until 2006.
the shares will have to be suspended before trading starts tomorrow.

[edmondj] 26/8/2004 20:39

LOL, I should be paying better attention to my investments, instead of the BPRG thread and my newspaper column!

But as I stated the last time I commented there, although the last set of results seemed disappointing the range of projects (including Swaylands) appeared to suggest that (barring a housing market collapse) unless management delivered the company would get bid for.

You don't attract RAB Capital onto your share register and disappoint, otherwise you are in play.

Derizzo, what are your grievances re. your property? We are having a shareholder discussion; my Sunday column is put to bed.

Regards,

Edmond

[derizzo] 26/8/2004 20:03

gg, forgive cynicism and ignorance, (I have good reasons to mistrust this company). There was some director/ family buying at the time I bought the shares, since when they've lost approx 1/3rd value. If for eg I was a director of a company that was in trouble and i wanted to pull out my share money at the highest pos. price, wouldn't it be easy to create a bid rumour to up the price prior to selling out? How can you tell if this is happening or not?m