Mapeley Share Discussion Threads

[chopsy] 23/10/2008 17:04

What's D4E?

[nickcduk] 23/10/2008 10:16

Not a long term holder in MAY. Just trade it occasionally. Usually when it moves sharply out of line with its peers. No position at present.

[gsands] 23/10/2008 10:01

Nickcduk,

I thought you were holding shares in MAY? It sounds as if you've sold out?

[nickcduk] 22/10/2008 21:24

I read that property derivatives are pricing in a 50% fall in property values from peak to trough. About 30% has gone through already. Another 20% still to do they think. MAY is unattractive versus other property trusts. IRET yields around 20% from a dividend that is about 90% covered. No debt maturity issues until 2013. LTV is around 44% based on end Sept figures. MAY obviously has a more attractive tenant profile but its metrics don't compare very favourably in every other sense. MAY need to make a few disposals and work hard at reducing gearing. I was surprised they bothered with the dividend last time out. I don't think they will be issuing another one any time soon. Market is currently very unforgiving.

[dancing piranha] 22/10/2008 19:15

Glad to see you are still fighting GSands! I just wish you had followed my stance and shorted down to 600p!

Although gutted I obviously closed far too early, but I suppose in this climate, think fair value for a company and half it, sounds about right in general!

[chopsy] 22/10/2008 17:59

Wow! (406).

They will be forced to halve the dividend again, and repay debt instead, as you suggest. IMHO, DYOR.

[gsands] 22/10/2008 17:57

Yes - but only when they've finished.

[deanforester] 22/10/2008 17:20

If Fortress are a seller, might we not expect to see an RNS?

[gsands] 22/10/2008 14:21

rochdale,

FWIW I am also sitting on my hands and will let technicals rather than fundamentals guide my topping up moves here.

If there is a distressed seller out there at the moment (Fortress) then best to stay out of their way and see how low they can push the price.

[rochdale] 22/10/2008 12:57

fair assessment GSANDS

think that this further fall in recent days is explained by Fortress putting a big sell order in the wings

this share is for the brave - tempted to buy more but until I pick up the courage will be buying up some more defensive stocks - oil, water, electricity, utilities etc..

[gsands] 22/10/2008 11:36

All of Mapeley's borrowing is long term on fixed rates (or hedge rates), with the exception of this one, which comes up for renewal in 6 months:

The second new facility is a £60 million corporate loan made to Mapeley Limited
repayable in April 2009. The interest payable on this loan is at 3 month LIBOR
plus a 5.0% margin.


This was the remains of the Delta loan which came up for refinancing recently and the terms are very unattractive. Unless the lending market improves significantly in the next 6 months, then this borrowing could be diffucult to place and Mapeley will probably have to deal with it internally.

It could be that they are aiming to clear this with retained cash (from halving the dividend earlier this year).

If this is their strategy then there will be no spare cash for share buy backs. Given the current state of the lending markets, this must be their plan of action.

[vida] 22/10/2008 11:30

I'm interested in taking a position here. Difficult to see that a yield of 20% can stay. Waiting for the update before getting in though. There are so many opportunities in this market that it's not worth taking risks.

Cash flow appears strong here though.

[gsands] 22/10/2008 11:26

Yield is approxiamately 20.8% at this level (assuming they pay it) but apparently the City don't believe in it.

I am surprised they are not buying back shares at this level. One can only assume this is because:

1. They are saving their cash for a rainy day - such as the need to clear the short term borrowing which comes up for renewal next April.
2. They anticipated distressed selling from large holders and are waiting for the share price to find a low before they buy back.

There will be a Q3 update at the beginning of November and we should find out more.

[chopsy] 22/10/2008 10:41

What is the prospective yeild at these prices, assuming they don't cut the divi again?

[gsands] 22/10/2008 08:02

I can only assume that the Times article might be correct about Fortress being a forced seller.

I cannot believe that the new CEO would buy shares in the company at 900p if there had been a materially negative change in the outlook for the company.

In a normal market, such a share price fall would almost certainly be indicative of a problem yet unknown in the public space. I sincerely hope this is just an irrational market...

[ok,yah] 21/10/2008 15:41

The resignation of the CEO, falling property values, refinancing uncertainty and fear of general armageddon in these markets remains - Set against this is the prospects of a multibagger when the market recovers . I see value here but keep trading out on rises as there are more obvious buy and holds out there that I feel safer with.

[loss-leader] 21/10/2008 15:33

The behaviour of this share is wild - each day it lurches by 100p either way and there are regular auctions. It does feel like someone is selling off - but the volumes are extremely low.

I would have thought that MAY was a perfectly reasonable prospect for refinancing (there must be lots of less secure income propositions out there). The sudden fall in the last month does not seem to reflect property value or future income streams.

LL

[tim 3] 21/10/2008 15:07

Yep this market can be vicious at times with almost relentless selling/markdowns I remember thinking the bottom may be in on dsgi at 80p its 25p now!

[dancing piranha] 21/10/2008 15:02

I have to say I saw 600p coming, but didn't expect lower than 500p! I hope GSands didn't overdo it as he kept buying at 1000p!

[tim 3] 21/10/2008 14:42

Was thinking of buying some of these at 1000 glad I did not, amazing fall.

Hope it comes back for those still in.

[dope007] 21/10/2008 14:33

It is not alone ignoble. This market has destroyed alot of very big stocks.

[ignoble] 21/10/2008 14:20

Holy Smoke !
This is turning into a dot-com share. Nearly lost 90% of it's value from the peak.

[gsands] 17/10/2008 23:27

The last meaningful transaction in this stock was the CEO buying £36k's worth of shares at 900p

He would not have done this if there was impending bad news concerning the day to day operation of the company or problems with the structure of debt.

Let Fortress sell if they need to. Short term lower prices create long term buy and hold opportunties for those with ££.