Paysafe Share Discussion Threads

[eh9] 20/12/2016 07:07

Goodbye shorts!!

[2bluelynn] 19/12/2016 21:35

I Follow British bulls dot com a bit with technicals and research of myOwn but I'm a massive holder in Pays long term Today they have a Buy signal about time too see web site too but they say below ..........Signal Update Our system's recommendation today is to BUY. The pattern finally received a confirmation because the prices crossed above the confirmation level which was at 338.95, and our valid average buying price stands now at 339.31. The previous SHORT signal was issued on 13/12/2016, 6 days ago, when the stock price was 370.37. Since then PAYS.L has fallen by -8.39%.Market Outlook The bulls have strong evidence on their side and this evidence prompts us to make a bullish bet. The bullish pattern that was previously identified is finally confirmed and a BUY signal is generated. It is probably the right time to be part of this boost and bullish market sentiment. The market is telling you about a possible new profit. Do not miss this chance.

[fourgirls] 19/12/2016 20:21

As I said previously,was an excellent opportunity to top up.It is often relayed by a lot of leading investors that the best time to invest is when there is the most uncertainty.I have used this to my advantage several times.Still holding this for a long time...good luck all.

[tsmith2] 19/12/2016 19:26

Let's see what tomorrow brings, I think a better than today

[wolfhound1] 19/12/2016 17:37

Hey - it looks like someone took the trash out as well !! Lol

[zcaprd7] 19/12/2016 17:19

CFO did alright with his options then...

[melf] 19/12/2016 16:49

.....and as the dust settles, the timeliness of Sands' entrance and exit still sits very uncomfortably with me. Maybe the timing of it was a "lucky" coincidence....similar to the pig flying past my window now.

[wolfhound1] 19/12/2016 16:45

Trading update at T-12 and counting !!!

[eh9] 19/12/2016 16:36

Any chance of more of the Morgan Stanley note?

[100laila] 19/12/2016 16:34

Just seen the Morgan Stanley note

They run through the shorters points in the Spotlight Research and one by one dismiss them. They give a target share price of £5.60. Their summary is:-

"We see a buying opportunity post press reports of short-seller commentary, with risks now overly discounted. We revisit our views on some of the topics brought into focus today, and reiterate our Overweight rating."

[trentendboy] 19/12/2016 15:59

Good analysis (in that is matches my own view on this)

[albanyvillas] 19/12/2016 15:16

Undoubtably there are paid users representing shorters on boards just as in all these situations. You need to do your own reseach and risk management (ie dont hold all your eggs in one company in case it does blow up) and then dont look at the boards, only look at press and RNS news.

For what its worth these posts seem to be genuine analyst reseach:

Paysafe’s share price fell by 18% yesterday, having been down 35% or so at one point. The sharesopened up by around 4% today.

We fundamentally disagree with the research report that prompted the sharp share price fall. The
report was issued on Seeking Alpha, which is a crowd sourced content service. As far as I’m aware,
anyone can post research on this site, although I’m not entirely sure if contributors are vetted. The
question is, who are Spotlight Research, the authors of the report? We haven’t come across them
before but we do know that they had a ‘short’ interest in the stock.

So, our take on the situation is that a shorter of a stock has issued a negative note making lots of
speculative and inflated claims designed to get a negative share price reaction. We fundamentally
disagree with their claims. In fact, the content of the report is highly misleading and is factually
inaccurate, in our view. Interestingly, the note was issued at 10am yet the share price didn’t react until
11am after some odd sell orders below the market price cascaded the share price down.

The main issues highlighted are the exposure to China via its payment gateway and the impact of
anti-money laundering (AML) directives. None of this is new news. The company has been very open
with the analyst community about its China exposure and has given analysts detail on the revenue
exposure and profit margin of that part of the business. On our calculations, the overall profit impact if
Paysafe was to withdraw from this business would be in the region of 16% to 18%, not in excess of
50% as the report claims. In China, online gambling is not regulated i.e. it’s a grey market. At any
point, the Chinese authorities could move to ban online gambling. We recognise this and had factored
this risk in to our investment thesis.

As for the impact of AML 5 – the latest AML directive – we and the company welcome it. In fact, the
company hosted a conference call on AML 5 some months ago with the analyst community
specifically to address its implications. The company has been very transparent and open about this.
As it is, it looks like the implementation of AML will be delayed into 2018. We do not agree that AML 5
poses a substantial risk to the business. In fact, we think that strengthening ‘know your customer’
(KYC) requirements will favour Paysafe, which we believe has very robust KYC processes.
As for the aggressive accounting allegations, these are not substantiated in the report. We look at the
cash flow of this business very closely. Cash generation is excellent, almost 100% conversion of profit
into cash. This is not consistent with aggressive accounting practices. Following the Skrill acquisition
in 2015, trailing net debt/EBITDA was around 3x. We expect the company to be almost debt free by
the end of 2017. That’s an impressive achievement.

I spoke too a couple of leading fund managers yesterday who hold this stock in their top 5 holdings within their UK Mid Cap funds to gauge their opinion and outlook following yesterdays news. summary below :

1) The view is that they are significantly overstating the profit contribution from Bet365 and China in particular. We believe it to be 13% of revenues and no more than 20% of profits.

2) The detail on the closure of 1-Pay and the use of an “outsourced service provider” is interesting but itself no material. We do not think this will cause either a liability from the operations in China or a potential impact of the view of the business in Europe or the US as a result of its operations in China.

3) We had always invested discounting the Chinese operations, they were useful in generating cash flow but could not be relied upon in the future. The business trades on 9.6x PE falling to 8.4x . The business will be debt free at the end of 2017, the FCF yield of the business is 12%. Even if we remove the Chinese business the company would trade on 11x or FCF yield of nearly 10%. The global peers trades on 20x PE or an EV/EBITDA of 11x versus an exChina PE of 11x or EV/EBITDA of 7x for Paysafe.

4) We are watching the news flow very closely and will be speaking with the management hopefully tm. We took the opportunity to add to our position significantly below the closing price, we have held the shares for the last 3 years and have done well by understanding the business and holding our nerve through volatility and adding to our position in periods of weakness - which we certainly consider this to be.

[wolfhound1] 19/12/2016 14:44

@lomax - I would not take all of the short reporting as gospel , whilst at face value it says one thing the opposite might be the case i.e. they can be short in Fund A and Long in Fund B - and not have to report the net position. As long as they are technically "seperate legal entities"

Motivation is simple - keep reporting short positions whilst you cover short and then go long to benefit from the spring back. That way they win both directions

[lomax99] 19/12/2016 13:23

Not sure, I had thought that given the sheer volume of trades last week (Tuesday c. 40M, Wednesday c 16M), etc that we would have heard far more from existing notifiable interests (As it is Sand Grove exited their short, Kames reduced their shareholding and Norges increased theirs slightly).

[ihatemms] 19/12/2016 12:27

Will we get any belated change in short disclosures today?

[heliweli] 19/12/2016 11:10

Can't blame folk that bought in cheaper from taking profits but it will bounce back up.

[malcolmmm] 19/12/2016 11:08

No, I buy end of day, some funny trades through, three buys of 63, 9, etc . Perhaps a message to other shorts? They have a lot at stake here and will try to drive down the share price by any means imo

[admin900] 19/12/2016 10:50

354p to 330p in short time not good.

[high park] 19/12/2016 10:36

Bots don't sleep.

[tsmith2] 19/12/2016 09:11

Rinse and rise coming up as shorters start to close

[malcolmmm] 19/12/2016 08:48

Should imagine that most investors in the US are unconscious at the moment

[abcd1234] 19/12/2016 08:43

redlee, the "US" can buy now... they dont wait , its a LSE stock on gmt/UK trading hours

[malcolmmm] 19/12/2016 08:35

Trance Man must be hoping for another short raid but with all the upgrades I think this is a dwindling hope. How is your short going TM?