Just Share Discussion Threads

[18bt] 21/1/2021 15:14

Credit Suisse selling c1% which poss accounts for slight weakness since the update. Encouragin that the slight weakness hasn't lasted too long.

[alex4141] 15/1/2021 13:32

A good opportunity to top up at the current levels.

[jimmyh1] 14/1/2021 22:00

No dividend yet I think. Agree that capital ratio will need to rise first and will need to see evidence of capital generation after their debt payments. But this is better than I had expected so perhaps I shouldn’t be quite so bearish. But capital neutral for an IRFS hit isn’t the greatest story. Would have liked to have seen a net benefit on one of the metrics...

[salver2] 14/1/2021 20:12

Very undervalued at the moment still - a 1.20 share all day long

[whatja] 14/1/2021 18:08

Doubt there will be a divi until the SCR is up around 170%.
Still a way to go on that. No harm in funds being reinvested in new DB derisking business which is a large market of which just is a small player.

Plenty of growth available and will need capital to support it.

IMO will be trading around 120 later this year, providing there is no economic collapse following the COVID pandemic.

[undervaluedassets] 14/1/2021 16:07

PE of 2.78 for final year 2019

Is it too much to hope for a divi? I think it unlikely given the mood for companies to hang on to cash and to be seen to be doing the right thing in these straitened times.

Still the news is good here and the value proposition striking.

[alex4141] 14/1/2021 14:34

Very impressive update during the covid-19 crisis - massively undervalued: “Retirement income sales for the 12 months to the end of December rose to £2.15bn from £1.92bn a year earlier, the specialist pension group said in a trading update.
Defined benefit derisking sales jumped 22% to £1.51bn. Sales of guaranteed income products fell 7% to £637m but business revived in the second half when sales were similar to a year earlier.
Just said its solvency II capital ratio improved by 9 percentage points from 145% at the end of June after it raised £177m of debt in October.
The FTSE 250 group also said it reduced its exposure to the UK property market by selling £540m of lifetime mortgage balances in December and completed a third hedge to cover £280m of lifetime mortgages.“

[hollcat] 14/1/2021 11:58

IFRS surplus down by £90m but almost certainly an improvement in the Solvency II surplus (for reasons above) - and they can recover part of this £90m by reinvesting into credit when prices are good.

[hollcat] 14/1/2021 11:40

IFRS surplus down by £90m but almost certainly an improvement in the Solvency II surplus (for reasons above) - and they can recover part of this £90m by reinvesting into credit when prices are good.

[18bt] 14/1/2021 11:35

hollcat - I think it may take another transaction to persuade the rgulators that there is a market. What they really need is for new investors to come in and buy the assets - I suspect this deal was with an existing player. I'll be interested to see whether some sensible brokers notes appear - not just the supporters like Panmure and RBC but the sceptics.

[hollcat] 14/1/2021 11:29

18BT - I agree this is very positive for Just, especially the sale of a mature book of LTMs. I agree the true value is dependant on the price they were sold for, and we await this detail, but this lends further credence to Just's argument with the Regulator to value these assets at a mark to market valuation rather than an incredibly penal mark to model. Furthermore this should allow Just to hold less capital in future arguing that they do not need to hold capital as if the LTMs were an illiquid option valued at risk free (CP16/18 or something like that). The Regulators view of LTMs is non-sensical given the large market of transacting LTMs - thousands are sold every day, and this transaction shows there is a bulk secondary market. I expect that when the market realises the significance of this we could easily be pushing at the 150-160 RBC target. I am buying more !

[18bt] 14/1/2021 11:27

What a day for this thread to go quiet!

[18bt] 14/1/2021 09:49

RBC has raised its price target from 150p to 160p. Hope they can persuade their clients to buy up to those levels.

[weemonkey] 14/1/2021 08:12

Just is, what many have argued for a long time, cheap.

[18bt] 14/1/2021 07:45

Very significant update this morning: good news on new busines sales, but the sale of £540m of LTMs is significant. Yes, there is a hit of c9p/share on the IFRS NAV, but some of this will be recovered in time as they invest in new LTMs. More importantly it demonstrates that there is a market for portfolios. There is no real information on the pricing of the sale i.e. was it a total recovery of the loan plus rolled up interest, a discount or even a premium. We shall have to wait until the 11th march to find out unless any of the analysts can extract that info from the company. Given that this is likely to be a book of fairly old LTMs which would be written at higher interest rates than prevail today, this could even be at a small premium. Either way, it should go some way to demonstrating the resilience of their assumptions and might, if more of the deals are done in the market allow some "mark to market" valuation assumptions to be included rather than a (heavily) discounted "mark to model".

This feels like an understated announcement - it will be interesting to see what the market makes of it. In my mind, this demonstrates the huge value in JUST.

[undervaluedassets] 13/1/2021 04:46

Highest excess death rates since WW2 for 2020 were announced by ONS yesterday.

As an annuity policy is simply a bet on the policy holder's longevity, annuity providers are set to win big from COVID-19; with many annuity policies being wound up earlier than anticipated and the provider of annuities the winner.

It is not a pleasant fact. But this is a statistical certainty.

[cjac39] 26/12/2020 19:47

aberdeen cleared out. credit spreads tighter. hpi up 2% over their assumptions. its got divi restart all over it. my fv is 120. i will sell at anything over 90p

[markoldroyd99] 23/12/2020 13:36

undervalued - I think you are being unfair to hamsters

[18bt] 22/12/2020 11:24

And when the epidemic over, I fear there will be a lot of cancer excess deaths as well as a probable increase in general mortality from lack of human interaction in older people.

Why is it that UK corporates have a code which encourages cognitive diversity but the scientists of the world are broadly allowed to get away with a biggest example of GroupThink we have seen ....

[undervaluedassets] 22/12/2020 09:33

Well from the perspective of a provider of annuities Christmas has come early.

81300 excess deaths to date since the pandemic began. And now we have the new variant of COVID; that combined with the abundant irresponsibility of the British public rushing hither and thither ignoring advice spreading it, will ensure lots of early deaths from mid-Jan on.

Sooo .. there will be many less payments by Just to annuitants. Hurrah (I am not saying "hurrah" at those deaths of course. I am simply picking up a found ten pound note and putting it in my pocket. what else should I do?)

I have doubled my holding here and of course, taken a substantial holding with LGEN (the uk's largest annuity provider).

We are a nation of fools led by fools. Anyone see/hear Priti Patel this morning? Brain of a hamster.

[jimmyh1] 17/12/2020 20:36

18bt: I hope you are right, but I think they are quite a long way from a dividend. Too much debt and too much transitional relief that will amortise away to pay one just yet.
HMT Solvency II review might help them but I am planning my (meagre) cashflow based on a 2023 resumption.

[undervaluedassets] 17/12/2020 16:30

Well said Rapier.

From where I am sitting COVID has had a benign/marginally beneficial effect on what was arguably already a cheap business.

[rapier686] 17/12/2020 09:42

Having had my grump, I own fewer shares now at 65p than I did at 45p. And, if my current opinions persist, all of mine would have found new owners by 150p. I don't have the first clue if that'll happen or not.