Petra Diamonds Share Discussion Threads

[blueball] 07/10/2019 10:53

Looking here today.

[mcrudden] 07/10/2019 10:20

Exactly right it's a very rare blue diamond of exceptional quality going up for a special look see auction. Very nice.

[technowiz] 07/10/2019 09:23

this not any old diamond up for sale. its a rare blue diamond worth £££;££

[rumobejo] 07/10/2019 08:38

wtf this rns for? rns is not for marketing ffs

[technowiz] 07/10/2019 07:19

sold via special tender. what does that mean? i hope it means big £££;£

[laptop15] 07/10/2019 07:12

https://twitter.com/laptop1515/status/1181089269865160704?s=19NICE RNS....MUST BE WORTH A MANY MILLIONS

[laptop15] 05/10/2019 09:30

https://twitter.com/laptop1515/status/1180396244193153024?s=19

[gosoftly7] 04/10/2019 14:46

Trying to find the current price of the bond - does anyone have a link?

Thanks

[ukgeorge] 04/10/2019 12:37

Great post Laptop...................


ðŸ›'NOTHING HAS CHANGED HERE ON THE FUNDAMENTALS

The company still has a massive amount of debt.

ðŸ›'JUST ITS GOT RIDICULOUSLY CHEAP TO BUY share price WISE 6.4p

Birds cheap. These could go lower. Massive rights issue.....

ðŸ›'BUY AS MANY AS U CAN AS IT WON'T STAY THIS LOW LONG

You don't know for sure what is going to happen (you were saying buy at 8p) telling people to buy is reckless.

[resourceful] 04/10/2019 10:58

firestone trying to swap 200m debt into equity
no wonder the price is gone

[laptop15] 04/10/2019 07:23

https://twitter.com/laptop1515/status/1180005164645851136?s=19

[davethehorse] 03/10/2019 14:47

FDI for one, GEMD look well placed imo

[wigwammer] 02/10/2019 18:58

I'm sure many lower tier diamond miners will go to the wall. Any idea what that will do to supply?

[plentymorefish] 02/10/2019 18:03

'god forbid interest rates rise'

now that's worth a lol.....a stalling world economy and you're talking about rising interest rates?!

[resourceful] 02/10/2019 16:18

are you all bonkers
Petra can never,never,repay its debts
diamond prices falling so free cash flow probably below interest rate costs
god forbid interest rates rise
its a walking deadman
only a massive placing....200/300m at say 2 p will fix it
there is not even spec value in the price
look at firestone today

[atticusfinch1] 01/10/2019 23:32

Great logic and exactly the reasons I've been steadily buying and will continue to do so. In a way I don't mind it languishing down here, gives me more time to build.I'd say the only thing missing from your analysis is sentiment, and ignores heard mentality and the irrational thinking that follows. Most shares overshoot in both directions..It just needs a trigger to kick start the inevitable upward trend.

[blueball] 01/10/2019 12:31

Should have stayed a bit longer.

[rumobejo] 01/10/2019 09:20

no point going against the flow, shorts killing it, out for now...

[psb123] 01/10/2019 09:00

I just cannot understand the price of this share. I've been buying this for a couple of months so please bear that in mind and do your own research, however...

Petra is priced almost as if it was going to go bust but I cannot see how that can happen. I always try and play ahead to what might happen and even if the share price wasn't able to recover substantially from here (and my basic analysis puts it's value at a minimum 3-6 times current price) there is too much value in there and someone would surely acquire and have to pay a premium to today.

Using broad, round numbers the market cap is circa £60m, the net debt is circa £500m, interest on the debt is circa £50m and the free cash flow is circa £70m at current levels (with a likely recovery in diamond prices and a major turnaround project underway).

Simplistically if I had £560m I could buy the business outright and pay off the debt, immediately wiping out the interest and have an asset delivering and immediate £120m return (£70m FCF plus the extra £50m no longer paying the debt) for an immediate 21% return for decades to come. Factor in some not unreasonable assumptions about diamond pricing (given supply is likely to crunch from next year) and operational improvements and it's not difficult to imagine that return being more like 35-40%.

More likely I would pay off half the debt and restructure the rest at a lower interest rate given the reduced risk profile. I'd then be looking at something like £300m for a £100m annual return (still paying £20m a year interest), potentially rising to as much as a 40-50% annual return with assumptions around prices and efficiency.

You can attach your own valuations to a business delivering those kind of returns but on any basis you'd have to say it would be a large multiple of today's valuation.

The value of the asset is so much greater than today's share price implies and I can't see how it could go bust because there would always be a way to realise that underlying value even if sold off at a huge discount to true value it would still be miles higher than today.


And I see that as a reasonable worst case scenario, more likely Petra are able to realise that value themselves over the next few years and then you could be talking about truly huge multiples of today's price.

Am I missing something? I genuinely can't believe how oversold this is

[wigwammer] 30/9/2019 21:02

I think both NOG and PDL have been hit by aggressive Berenberg downgrades in recent months. Since when were Berenberg such an authority?! Presumably the downgrades arrived after Berenberg capitulated - having spent years pushing both stocks. The historic evidence would suggest that doing the opposite of what they instruct would have saved clients money :)

[wigwammer] 30/9/2019 14:50

Argyle mine in Australia to close in 2020. That's 10% of global production gone. Exploration spend has been falling for many years - production falls are inevitable over the next decade. A growing middle class will still want diamonds and pdl own the third largest resource globally. This will be a nice place to be :)