Phoenix Share Discussion Threads

[solarno lopez] 07/9/2017 11:09

Many thanks Stun

[stun12] 07/9/2017 11:03

Thanks, solarno. I did use AJ Bell as we have our SIPPs with them and they have always been efficient. There isn't too much choice for LISAs as the high street banks don't seem to be interested. Of course, SIPP providers are already familiar with claiming money from HMRC in tax relief, so they will be the obvious go-to for LISAs.

[solarno lopez] 07/9/2017 10:44

Stun may I ask who you use for the LISA as I have been contemplating setting one up for my son. There are so few brokers who deal with LISAs and my own does not. I am tempted towards AJ Bell but have never dealt with them

[solarno lopez] 07/9/2017 10:24

Good for them and I wish them well

[stun12] 07/9/2017 10:21

True, solarno. He's 20 though, so the prospect of saving up for 45 years time probably isn't going to thrill him. He (+ girlfriend) don't want to rent so are making a real effort to save for a deposit. The LISA scheme is unusually generous so they're both trying to put in the maximum amount each year for 5 years or so.

[solarno lopez] 07/9/2017 09:53

Stun he could keep it for his pension which is another alternative

[essentialinvestor] 07/9/2017 09:46

FCA news this AM as most will be aware.

[stun12] 07/9/2017 09:22

Bought some more, this time in my son's LISA. So not just a divi, but also a 25% top-up by the government at the end of the year. Only allowed to buy a house with it, mind.

[stevenrevell] 07/9/2017 09:11

Ta may add again I think hopefully £8 soon

[garycook] 07/9/2017 09:09

Corret 25.1p.

[stevenrevell] 07/9/2017 09:07

Is it xdiv today

[woodhawk] 04/9/2017 14:10

Yes, I've added some more on the fall - doubled my holding now.

[my retirement fund] 04/9/2017 13:28

Also just topped up. Ex divi for interim on 7th Sept. Payment 2nd Oct.

[lauders] 02/9/2017 01:35

Hope you do well with the rest of us Woodhawk. I note that the IC also updated their previous buy with another buy as per a post on iii:

Tip Update: Buy at 781p

Phoenix is churning out cash

Acquisitions are a vital part of income play Phoenix’s (PHNX) ability to continue growing its cash generation and therefore its dividend. However, last year’s acquisition of Axa Wealth has proved more beneficial than expected, generating another £165m during the first six months of the year. That takes the total amount generated by the closed book life assurer’s latest purchase to £282m, above the £250m targeted within the six months of completion. Annual cost synergies are also expected to be between £13m and £15m, up from the £10m anticipated.

That helped take total cash generation up to £360m, more than double the same time last year and beating consensus expectations of £333m. Management actions, including reducing expenses contributed £69m to operating profit, which also doubled year on year. Actuarial assumptions were updated to reflect lower longevity rates experienced across the industry, which also contributed.

Management also announced plans to cut annual fees on its workplace pension products to 1 per cent at the end of 2017. It took a resultant £28m provision against the profit impact.

The capital surplus increased from £1.1bn at the year-end to £1.7bn at the end of June, leaving plenty of space for further acquisitions. Analysts at Shore Capital expect adjusted net assets of 617p a share at 31 December 2017, down from 684p at the same time in 2016.

The shares are up solidly on our buy tip (582p, 10 Apr 2014) and trade at 1.3 times forecast net assets, a more demanding valuation than at the full-year results. However, the group is progressing well against its cash generation target of £1bn-£1.2bn between 2017 and 2018. With a forward yield of 6.4 per cent, we remain buyers.

[woodhawk] 01/9/2017 14:00

Just topped up my holding - thought the results were very good and ex-divi for 25.1p as of next week. Can't be bad!

[hazl] 25/8/2017 21:39

thanks for reply

[hyden] 25/8/2017 21:03

One example is that it allows the company to offset risks against one another. One of the risks PHNX faces is that of life Assurance policyholders dying early because it has to pay out the sum assured. The SunLife book is predominantly Lie Assurance. Now, if PHNX buys an annuity book then PHNX will be able to offset this risk because the company will make a corresponding profit on the annuity book if people die young. The net effect is that PHNX will be required to hold less regulatory capital which means either more money for shareholders or more money for acquisitions.

[hazl] 25/8/2017 09:11

I am not a holder here and not upto speed.
Could anybody tell me why it would be good to take on such risk?

'annuities - which see insurers take on the risk of a company's pension scheme.'

[robsy2] 25/8/2017 09:01

Thanks for that, bodes well.
R2

[speedsgh] 25/8/2017 07:38

Phoenix hunts for deals as it sits on 'more money than ever before' -

...The group now has the financial flexibility to go after more deals, chief executive Clive Bannister said, adding the time is ripe given many firms in the UK insurance industry are consolidating or being chopped up.

"A lot of people in the old industry want to be capital light investment managers - if that trend continues that will create opportunities for us," he said. "[At the] same time there is this rapidly growing annuities market."

The firm, which is expecting the bulk annuity market to grow to £350bn in the next decade, is keeping its eye out for deals in this space just as insurer Prudential considers selling around £10bn of its annuities back-book.

While Mr Bannister declined to comment specifically on that portfolio, he hinted that his firm was more likely to look for "proportionate and selective" deals in bulk annuities - which see insurers take on the risk of a company's pension scheme.

Bigger acquisitions are more likely to come out of the £300bn "closed life" market, which the group said remains a key focus. The business has around £500m of cash to fund future deals...

[jonwig] 25/8/2017 05:53

Citywire:

Shore Capital: Phoenix income attractions ‘considerable’

Cash generation and operating profits at insurer Phoenix (PHNX) continue apace, meaning the income attractions ‘remain considerable’, says Shore Capital.

Analyst Eamonn Flanagan reiterated his ‘buy’ recommendation on the stock, which was flat at 775p yesterday.

He said interim results were better than the market expected and the ‘cash generating abilities of Phoenix remain resilient with the group on target to deliver between £1 billion and £1.2 billion in 2017’.

‘Trading at a mere c.15% premium to our 2017 forecast net asset value of c.670p with a 6.5% forward yield, we reiterate our “buy” recommendation,’ said Flanagan.

‘The income attractions remain considerable and secure, with the company committed to “protecting” its dividend paying ability as part of any deal criteria.’

[jonwig] 25/8/2017 05:39

Thanks Lauders - seems to have been removed - hopefully temporary.

[lauders] 25/8/2017 01:51

jonwig - The webcast was available at the link below earlier but the video was not working (just colourful noise in the form of mutli-coloured lines) and the slides were out of sink to the sound (which was clear) so I assume they removed it to sort out the issues. Although I was half asleep at the time, everything I heard sounded encouraging. As you say the Q&A part is the best and there were some good questions including one on how long would PHNX survive if no more acquisitions are made. The nature of the question was made in a "fun" way and the reply was just as "fun" if not serious. Listen to it when you can and "sofa" will let you know what I mean. The BOD had no concerns with any of the questions raised and they say things will only get better when the two on-coming trains of more people retiring (baby boomers) and other financial instituitions want to sort out policies they hold and "outsource" them (read sell to PHNX) get ever nearer to one another.



Expect more M&A activity going forwards. They are apparently pretty experienced at it now ;-)

[arf dysg] 24/8/2017 21:19

Maybe in the next few days we'll see the effects of institutional buying (or not).

[jonwig] 24/8/2017 20:26

edmund - thanks for that: I haven't had time to look, myself.

The webcast recording doesn't seem to be on the website yet (nor the slides). You often get searching questions at the end.