Imperial Brands Share Discussion Threads

[essentialinvestor] 04/10/2017 10:43

I'm buying in very small amounts only.

[speedsgh] 04/10/2017 10:29

I wouldn't rule out a test of 3000p in due course. It would still only put it on a 5.7% yield for the current FY. Aimho

[essentialinvestor] 04/10/2017 10:04

Added a third lot at 3141.

[philanderer] 03/10/2017 12:41

RBC note:


Market share gains in H2 reassure us that the good stuff Imperial is doing to fix its volume trend is starting to have the intended results, notwithstanding the unwelcomed contribution of the one-off pension restructuring. Meanwhile, we think concerns over the sustainability of Imperial's dividend and Investment Grade credit rating are overdone.

The fact that the pension restructuring is instrumental to be "on track to meet earnings expectations for the full year" is not what we hoped to hear in Imperial's pre-close statement. On the other hand, the market share gains flagged by the company in H2 reassure us that the good stuff Imperial is doing to fix its volume trend (brand migrations, SKU reduction and increased investments) is starting to have the intended results.

Meanwhile, we expect Imperial's generous dividend policy to continue to be supportive in the medium term. In our base case (EPS CAGR of 4.6% over the next ten years) we expect Imperial to be able to sustain the current dividend policy of +10% p.a. for 7-8 years before the payout ratio exceeds 90%, implying a distribution of around 50% of the company's current market cap. Assuming a volume shortfall of 1.5% and 3% implies the current dividend policy would be sustainable for 5-6 years.

As for the credit rating, we think the evolution of Imperial's Debt/EBITDA would be consistent with Moody's criteria for Investment Grade both under our base case and assuming a volume shortfall of 1.5% (3.5x in FY18E and FY19E respectively). As for RCF/Net Debt, we don't think it will become compatible with an Investment Grade rating in the short-term, although it is very unlikely it can trigger a downgrade alone, given that the low level is merely a function of the high dividend paid.

Assuming a volume shortfall of 3% would push the two metrics in "danger zone" but, even in this case a downgrade would be far from granted given that Leverage and Coverage ratios carry a weight of only 36% on the final rating vs other more qualitative factors making up for the difference.

[philanderer] 03/10/2017 10:57

3rd oct RBC 'outperform' tp 3500p cut from 3600p

[action] 02/10/2017 17:36

Divi for nov17 and feb18 is coming up 55p each as per last year.

[jrphoenixw2] 02/10/2017 15:53

I bought a pretty chunky chunk today, as part of my long-running Long-Term-Buy+Hold portfolio. Look forward to following this thread.

[essentialinvestor] 02/10/2017 15:00

Meaning whatever amount you want to buy, might be worth doing in stages
rather than as a single purchase.

[linton5] 02/10/2017 13:07

All in with my trading pot Essen I'm not that daft 🦉

[essentialinvestor] 02/10/2017 12:47

Don't go all in, stagger any buying just fwiw.

[linton5] 02/10/2017 11:50

I'm waiting to load up here,bring er down chaps

[essentialinvestor] 02/10/2017 11:01

Looks like we may be going lower.
FX and UKX should be supportive this AM, and unmoved, just my guess only.

[philanderer] 02/10/2017 10:40

2nd oct Jefferies buy tp 3600p cut frpm 4100p

[essentialinvestor] 29/9/2017 18:02

Well the sector has largely geared up on debt to fund acquisitions
over the past few years. So scope may be more limited.

Intend to add a few lower down, if available next week.

[spacecake] 29/9/2017 17:04

How low before the takeover/merger rumours start up again I wonder.

[linton5] 29/9/2017 14:37

I got in yday guys good luck

[essentialinvestor] 29/9/2017 14:03

Hi Phil, just had a small amount.

[philanderer] 29/9/2017 13:43

Afternoon EI, I've added a few this afternoon.

JP Morgan Caz. NEUTRAL. tp. 3230p. cut from 3770p
Deutsche. BUY. tp. 4100p

[action] 29/9/2017 12:52

You mean 3200?

[rimmy2000] 29/9/2017 12:51

May go above 3100

[essentialinvestor] 29/9/2017 12:42

Thanks for the view.

[action] 29/9/2017 12:41

May go below 3100

[action] 29/9/2017 12:40

Bought yesterday averaging down . Still think it may below 3100 b4 dust settles IMHO

[essentialinvestor] 29/9/2017 12:38

Any one buying, adding ?.