Keystone Law Share Discussion Threads

[alphabeta4] 17/9/2021 11:29

Agreed, I have good value to £9.64 even if H2 is the same pbt as H1 and £10.51 if H2 revenue comes in at £36m.

[mpg] 17/9/2021 01:26

Quote "We are confident that we will deliver another good performance during the rest of this year which will be materially ahead of current market expectations". The PE maybe high but given the rate of growth, the scalability of the model and the complete lack of debt, I believe that it's justified.

[tkamp] 16/9/2021 11:05

Keystone is an absolute beast, stellar results today. Really kicking myself for selling earlier this year at 630p

[alphabeta4] 16/9/2021 09:28

Wow, 30% beat even if it does the same £4.6m adj PBT H2. The 8% rise today looks a bit of a bargain!

[tradertrev] 15/7/2021 21:51

Keystone is a fantastic business model, but on more than 40x forward P/E you'd be far better off buying GTLY which is also a great business on less than half the P/E multiple. DYOR of course!

[maddox] 15/7/2021 14:24

Thanks MPG for your insights, the legal services market does appear to be hot.

[mpg] 15/7/2021 09:19

Anecdotally.... activity levels appear to be extremely high. In the business sector I work in the call for solicitors is high with a lot of deals being done (transactional work) and disputes to resolve (litigation). The solicitors we deal with have said they are struggling with the level of demand. Combined with the Keystone way of working, tempting more solicitors to work for them, I anticipate that Keystone are trading strongly and managing to expand in a high demand limited supply market.Despite the significant rise the stock still seems to be flying under the radar.

[maddox] 10/7/2021 11:58

We've had a 19.5% rise from c.630p to 753p with little volume and no news or tips, that I can find at least. Presumably there is some accumulation going on.

[maddox] 07/7/2021 23:19

Interesting share price rise but on little volume. Anyone have any insights?

[maddox] 21/1/2021 17:34

We had a inkling that legal services were experiencing strong demand back in October when RBGP reported 'Rosenblatt Limited ("RBL") has continued to trade well with case value and volumes remaining significantly ahead year-on-year.' KEYS in November were a bit more measured 'performed well throughout the second half to date' despite Covid-19, and 'now expects to deliver profits for the year comfortably ahead of current market expectations' This has now become the far more positive 'expects to report adjusted profit before tax for the period which will be materially ahead of current market expectations' Always think it useful to understand how the results/updates narrative is pitched and how well performance correlates across the different firms and markets. Does anyone have good insight into the drivers of this demand? Is WFH generating a lot of divorce cases for example?

[alphabeta4] 21/1/2021 08:40

Very impressive update, taking the usual 'materially ahead' to mean at least 10% then pbt forecast at least £5.61m. Would imply H2 pbt of at least £3.4m. Cash at interims was £6.9m, £1m dividend paid since, £3.4m x say 80% is £2.72m. £4.4m cash on finals so now have c£4.22m extra cash vs then or c14p a share. Last year pbt £5.8m so forecast now circa 3% under. Share price back then £6.20, implies (£6.20*0.97)+14p for £6.16 minimum target. Seeing as consensus forecast forward pbt was £6.41m back then and they have just done £3.4m H2 would imply there's a case prospects are more solid vs back then (presumably from underlying business growth from fact they've still been adding partners in the recession). If so then could be further upside on the £6.14. A cautious £6.8m pbt forecast (£3.4m*2) would add another 6% to this target (6.8/6.4) for a target price of £6.52. All IMHO of course but enough for me to have added this morning, looks a quick 20% available and potential for positive surprises.

[tkamp] 09/1/2021 10:43

Keystone reported 10 new partners joining them in January, which is a great figure, especially on the back of many other sign-ups in H2 2020. I suspect 2021 will be a very strong year for Keystone.

[energeticbacker] 14/9/2020 15:38

Keystone’s platform business model has demonstrated terrific growth over recent years and we are impressed they still managed to attract a significant number of new lawyers during such a challenging period. The shares trade on a mighty valuation (PER 2021: 31x) compared to other more traditionally structured AIM listed law firms but its platform model has evident appeal and could be increasingly attractive to lawyers in the remote working environment. More on the Investor's Champion website.

[tkamp] 14/9/2020 12:28

Good set of results from KEY. Still managing to grow revenues when the economy (world) came to an almost complete step is impressive. Hopefully they can soon return to >15% growth rates

[tkamp] 29/8/2020 08:43

I doubt that's true. You're a day trader, I think you barely know what Keystone does.

[halfpenny] 28/8/2020 11:46

KEYS have a number of Partner/Virtual Lawyers who do the work for those who Outsource their legal work. Since Covid the demand has increased tenfold so results next month will be great news.

[tradertrev] 26/8/2020 23:18

This firm's clients are mostly SMEs - they don't have in-house legal teams/departments. It's not an outsourcing play. Good business nonetheless.

[halfpenny] 26/8/2020 12:50

Boozy, you are correct and now is the time to get in as the spread is very close... 600 my target

[halfpenny] 26/8/2020 12:45

KEYS, they are now looking good value and with economy moving does put them in a strong outsourcing position. Companies are now looking closely at their bottom line and in house legal teams are expensive so Outsourcing is the next phase to improve productivity. See £6 plus as we get closer to Results in September.

[boozey] 25/8/2020 17:32

Maddox, I agree. The business model of KEYS - like DWF (which I know about) and INCE (which I know very little about), has a business model that is tailor-made for tough times as companies outsource non core business activities (legal in this case) rather than carrying heavy specialist costs in-house. Seeking out sectors and companies that can prosper in the current climate is key to having a progressive portfolio right now. IT Outsourcing, online retail, Computer Games to name but a few. And Energy is a good defensive sector even if it will never set the world alight. Specifically on Keystone, with a spread of 20p+ at times it is almost impossible to short it without taking a massive risk. As it is an illiquid stock one has to be prepared to stomach the swings up and down as long as over time it goes more up than down!

[maddox] 25/8/2020 12:41

halfpenny - you are a day trader with a short on, talking down the price - you haven't a clue. You've been shorting INCE and looking for another share in same space. Do you really think we're stupid and your one-liners will influence the sp? Looking forward to your insights and analysis on KEYS.

[halfpenny] 25/8/2020 10:57

Target 600 and NOW is a time to get back in...

[halfpenny] 25/8/2020 10:56

KEYS are now LESS Risky i got out at THIS LOW and now expect further growth as profits increase and Risks decrease looks good and this is a LOW price

[wingrove4] 12/8/2020 15:35

Bought some more today, been a very profitable share for me as you say thinly traded, but noticed the spread is better than previously.

[tkamp] 12/8/2020 09:27

The fact that shares are flat despite this news is pretty surprising, though it just goes to show how incredibly little trading takes place in this stock. One thing from the news announcement that jumped out to me was the comment that 55-70% of lawyers's earnings in the UAE subsidiary will be paid out to lawyers. I believe that in the UK this share is 75%. That means that Keystone would see margin accretion long term in case the UAE operations are a success