Melrose Industries Share Discussion Threads

[yertiz] 31/3/2020 12:57

Really? Post the link, please. Anything about Rolls Royce in the same issue?

[minerve 2] 31/3/2020 11:08

FT quote from yesterday:

"Melrose Industries, the publicly listed private-equity style sacking-people-and-making-operations-run-as-hot-as-possible-before-flogging-them-off specialist."

LOL

[minerve 2] 31/3/2020 10:27

jackdaw

Buy-backs - when executed properly - should be a function primarily of return on capital so if it works at £28 it works even better at £13. Unfortunately, lots of executive pay is linked to earnings per share so the way for directors to earn more ATM is easily done by using cheap debt to decrease share numbers. Your job as an investor is to decide which camp the company falls into. If the buy-backs are done from earnings and its highly correlated cashflow then they fall in the first camp, other than that they are probably in the second camp.

A very good example of a company that executes share buy-backs to perfection for the benefit of its shareholders and executives is NEXT. Go to their 2013 annual report/account for a wonderful description of their share buy-back policy by Lord Wolfson.

[deadly] 31/3/2020 08:20

-20% then +20% swings in 2 days for this are amazing.

[jackdaw4243] 31/3/2020 08:12

I struggle to understand the merits of share buy backs when the share price is going through the floor. It brought GE nothing but pain, Shell have stopped what do Ashtead know, buying back at £28 and down to £13.

[archy147] 30/3/2020 22:33

I bought in on the drop today. Gradually building a portfolio of strong FTSE 100 and 250 companies that are trading at 1/3 of their previous highs. (MRO just falls short of this criteria but after today’s drop I couldn’t resist).

This may not be the bottom (it’s impossible to call) but a year or so from now I expect to have made a 100-200% profit on each of these bad boys.

GL all holders!

[minerve 2] 30/3/2020 20:21

gettingrichslow

I'm sure you timed it right getting. And I'm sure you will time EVERY bottom of EVERY share you hold!

LOL

If you buy the right companies you really shouldn't have any need to sell when prices go lower. You should be a buyer.

[henley2] 30/3/2020 17:32

The only surprise with the trading statement is why they chose to issue it 5 minutes before the close of the market.
It’s out of the way now, they’ve announced the dividend cut and told the market about their financial position. Given the volume of shares traded in the closing auction, presumably short covering induced, it’s time to buy!

[gettingrichslow] 30/3/2020 17:32

Minny, they’re not professional investors, no, but they still made the right decision didn’t they?! Unlike you it seems who didn’t have the right stop-losses in place. They, like me, are now sitting on big cash piles that are worth way more than if we hadn’t acted. Now that might not be such an issue when dabbling in relatively small amounts of money like you do, but at the amounts I had invested I had to act fast, and I did, and I’m very glad I did! Sometimes you have to make big calls Minny, and it seems you failed to do so!

[gettingrichslow] 30/3/2020 17:16

I’m amazed people are still asking ‘why has this fallen?’. Are people not watching the news??

[minerve 2] 30/3/2020 16:51

Keep safe all. This is horrible.

[minerve 2] 30/3/2020 16:50

Ashtead is certainly one to watch. Probably going to fall more as the US starts to feel the pressure more - not pleasant but will push down the price. Ashtead is a good stock to hold in a portfolio as an hedge against catastrophe insurers. When hurricanes hit insurance companies get hit also but Ashtead gets a boost from rebuild whilst you wait for insurance premiums to pick up. :)

[yertiz] 30/3/2020 16:44

Thanks for the reply, Minerve2 - appreciated (honest!). I'm not buying anything until the smoke clears, then there'll be some BIG money to be made, providing I get in early enough. Melrose may not be at the top of my shopping list, but well worth a crack at sub - 80p.

Looking intently at rebuying Halma, Ashtead, house builders (Vistry, Redrow,) and infrastructure developers (Hill & Smith, Segro) if these are still in business by the end of June.

Stay virus free, safe and Indoors!.

[1jezza] 30/3/2020 16:40

As usual it would seem the knowledge of the profit warning etc statement was known by parts of the market by early afternoon as volume accelerated and those in the know got out. An unfortunate characteristic. Over the next few weeks there’s likely to be a tsunami of similar ftse 100 announcements. Debt management obviously must a priority for MRO given its balance sheet following GKN. Not convinced of the merits of gestures of 20% salary cuts and would assume no annual bonuses for a directors for a while. Biggest shame is that management was slow in getting even one post GKN disposal away last year.

[minerve 2] 30/3/2020 16:39

getting - living life by anecdotes yet again.

[minerve 2] 30/3/2020 16:38

“My brother is a GP and one of my best friends is a surgeon in the NHS and both of them have sold everything at any price.”

Professional investors then.

ROFLMAO!

[yertiz] 30/3/2020 16:36

Hello GRS, been away for a couple of weeks watching the carnage from afar. Still more to come before any improvement as UK plc is on complete shutdown. Interesting drive back from London at the weekend, M25 was a virtual car-free zone, nothing taking off from Gatwick or Heathrow, only a very few landing. The way forward is unclear, but expect the same or even more stringent controls in the weeks to come. 4 - 6 months before normality returns. As I said on Halma's bb, I'm sitting on my hands and on huge cash reserves, where my money is doing nothing, but shares are still falling. The end to this chaos is not yet in sight, but when it is, I expect Melrose to surge upwards, doubling in current values - that's where & when the big money will be made, IMHO.

[ali47fish] 30/3/2020 16:34

why has it fallen then please!

[minerve 2] 30/3/2020 16:29

Yertiz

Sure am. I bought a tranche or two in Strix about a week ago and am buying tranches in Philip Morris International (US) when it hovers around $66.

Some of my stocks - purchased in the last 12 months - are trading positive for me such as Phoenix Group Holdings.

You need to buy stocks close to inherent value. Mix bags like Melrose are very difficult to value.

Good luck!

LOL

[investor2018] 30/3/2020 16:24

getting rich- this RNS was posted at 1625 , by which time the share price was already 18% down. This would suggest to me that the dividend cut has already been priced in and is widely expected by the market, hence the big fall of late. Technically we are at a very important support level. For me, the risk/rewards from here are too good. I'm long. Probably a tree shake first thing.

[minerve 2] 30/3/2020 16:22

Pasta la vista Baby!

[yertiz] 30/3/2020 16:22

Still a buyer at these prices, Minnie - not that you have much funding left? LOLOLOL