Mitie Share Discussion Threads

[bagpuss67] 20/1/2017 11:31

Not sure they can afford to prop it up with share buy backs anymore.

[robinskardon] 19/1/2017 13:35

This is crazy. The share price is almost back to where it was before yesterday's profit warning. Was the market expecting something even worse than the update?

[essentialinvestor] 19/1/2017 12:26

Bones, yes and MTO is a reminder of why I do not go short individual stocks,
find timing the short side more difficult.

[robinskardon] 19/1/2017 12:12

Agreed Bagpuss. It seems a lot of investors are putting an awful lot of faith in the ability of the new CEO to perform some sort of magic!

[bagpuss67] 19/1/2017 10:57

Astonishing. That this has barely moved down on such a grim update. They must be struggling to keep all the plates spinning though. Still think this will at some point suffer a further major crash in share price.

[bones] 18/1/2017 19:21

The big risk in going short on these potential basket cases is an opportunistic bid emerging from foreign parts using cheap sterling. Whether MTO holds anything of interest is debatable but this happened to BRAM which, while a different area of business, looked a spent force financially yet shorts got singed.

[essentialinvestor] 18/1/2017 15:18

Goodness was it 10 years ago!. The years fly by now unfortunately.

[essentialinvestor] 18/1/2017 14:47

fidra, the MTO founder died a few years ago, long since retired from the business-
and for a couple of decades or more their model worked beautifully, enriching
both management and shareholders

What happened imv is as the Company expanded that never ending growth cycle
became increasingly difficult to maintain, leading to arguably lower quality
decisions and highly priced acquisitions.

It bears some similarities to Rentokil about 16 years ago,
where the then CEO was known as Mr 20%, a reference to their annual EPS
increases.

RTO survived following divestments etc and is highly profitable,
not sure how this will end for MTO.

[robinskardon] 18/1/2017 14:44

Like EssentialInvestor I am also amazed at the current price given today's TU.From my point of view I see this as below 150p and as someone else posted earlier MTO could even go bust if the debt grows too much. Just my view!

[fidra] 18/1/2017 14:34

Essentialinvestor whats your view on the now departed management,and the strategy they adopted?

[essentialinvestor] 18/1/2017 13:45

MTO, like CPI, made a lot of early investors huge returns.
Until recently MITIE had a 20 year plus growth record, I remember the Company
as a teenager reading the IC - mispent youth ).

[neilyb675] 18/1/2017 13:11

Very poor read, watch and wait....imvhpo ✔

[essentialinvestor] 18/1/2017 12:54

Mentioned this elsewhere but I am stunned the share price is still around current levels.
The price reaction looks highly generous to me, as always just IMV only.

[bagpuss67] 18/1/2017 12:30

That was a horrible trading update. They quote "underlying" earnings who knows what further exceptionals will be required. This can go below £1. Easily.

[fidra] 18/1/2017 11:33

LOL!

Also IMHO the share buyback has artificially propped the share price up.Why if they knew of these problems did they continue the share buyback.The shares would have been worth less and they could have bought more back.
And if they didnt know what have they been doing all these years...err apart from increasing their own benefits and wondering about their PR.

Personally I am expecting more of a clear out of the old guard and a sell off of some bits .Debt is too high.HQ is too costly and decisions made in the HQ have made the position worse.
The FD came from I think Serco many years ago from a small job.within a short space she was FD at MITIE ,overpromotion and unable to confront the truth while lavishing in a huge salary and benefits while well beyond her capabilities.With no gravitas or experience.But hey thats what Ruby wanted she was on her way....

[essentialinvestor] 18/1/2017 11:00

You really have to marvel at modern PR.

[fidra] 18/1/2017 10:38

It is not only her it was the Fd as well and numerous directors doing deals for themselves in the"new startups'. Then having their family's start ups bought for large amounts of money.Too much backslapping,while the businesses that could improve being starved of capital due to mistakes and greed at the top.

I personally think Ruby was not really that good,and pr made her up!Not only that, the company paid for her PR .She could not leave a few years ago by making it appear inPR she was indispensable!She was just left to dig the trench deeper!

How she was made a baroness is another scandal

Always wondered why Isqbel Macpherson left not long after the social deal.

Only my opinion of course!

[essentialinvestor] 18/1/2017 10:27

fidra, what do you think of the amount paid Ruby over the years, plus share options,
pension top ups ).

[robinskardon] 18/1/2017 10:17

Peel Hunt and Liberum both reiterate their Sell recommendations this morning. PH retain their target price at 174, Liberum reduce their's to 165. Both look too optimistic to me. No indication in the TU of what net debt is now but as others have pointed out mention of the covenants must mean it is increasing still - £300m plus?

[fidra] 18/1/2017 09:47

Actually two women and a board of directors who were sycophants.And others who were only in for themselves and what their family could get out of it.Hopefully they still have there shares and a re beginning to feel some responsibility ...I do doubt it though.

I think I said what I thought re the finance director some years back.A large salary did not make her a better FD.whereas some of the senior managers given more freedom and paid more would have delivered more at an operating level.

The m and e division mistakes are repeated throughout this company.

The social care could actually have been better.But frankly they don't have the nouse or the will to pay the correct people to sort it, or manage the loss better now it is closing.So will end up with a bigger loss.The social care they could manage it down better but wont.They could actually with better management make it turnaround and get a sale to another at a later date they wont though.

They talk the talk but really they couldn't walk the walk.

A Shame really

[bagpuss67] 18/1/2017 08:24

These businesses can go bust. Look at connaught. Look up what MITIE stands for? The model is all about management return. There is a natural need to push things to keep the share price progressing. The easiest place to do it is the balance sheet.

[bagpuss67] 18/1/2017 08:10

FD steps down and mention of banking covenants! This could go bust. What horrors are lurking in that balance sheet!?!

[blueball] 18/1/2017 07:59

I reckon down to 190p today.