Provident Financial Share Discussion Threads

[tradejunkie2] 22/2/2019 11:58

Shareholders completely shafted here.

[dendria] 22/2/2019 11:45

With the share price at 560p+ the market must be expecting a higher offer, or another bidder?

[richardbrook1] 22/2/2019 11:41

I note PFG at ‘shareholders are strongly advised to take no action in respect of the NSF offer.‘

[patientcapital] 22/2/2019 10:44

From JvK's website:"John left Brown Shipley in 1991 to become Group Chief Executive of Provident Financial plc, the consumer credit and motor insurance company. He was appointed Chairman in 1996, a post he held for the next 17 years. In 1997 he led the strategic decision to start an international division with substantial businesses being created in Poland, the Czech Republic, Slovakia, Hungary, Romania and Mexico. A decade later Provident joined the FTSE 100 and the international business was demerged as International Personal Finance plc with a market capitalisation of £600 million. He also led the strategic decision to recruit a team of credit card experts to launch Vanquis Bank, which now has pre-tax profits of £200 million. During John's tenure as CEO and Chairman, Provident Financial plc shareholders received a 44x total shareholder return (with dividends re-invested)."

[patientcapital] 22/2/2019 10:35

It's a management question. JvK left PFG in very good shape after a long time in charge. I'll certainly give him a second crack of the whip. No question.Will it flush out a higher bid? It might.

[dexdringle] 22/2/2019 10:21

Blimey, things at PFG must be bad if a 'nil premium' reverse takeover by a firm a tenth of the size is considered a good thing.

[dekle] 22/2/2019 10:01

Taking out a rival has got to be a great move for NSF so joining them must be good for PFG

[superstardj] 22/2/2019 09:38

topvest, the debt is like working capital in this sort of business. They borrow long to lend short. Look at the receivables balance in debtors - that is the flip side of the coin.

[patientcapital] 22/2/2019 09:22

Et al-- Woodford, Invesco and Marathon have given irrevocable undertakings to accept the Offer and letters of intent to accept (or procure acceptance of) the Offer in respect of, in aggregate, over 50 per cent. of Provident's issued share capital.

[jonwig] 22/2/2019 08:26

And the presiding vicar? Rev. Neil Woodford.

[topvest] 22/2/2019 08:10

A merger of two highly leveraged lenders. A marriage made in heaven!

[patientcapital] 22/2/2019 08:03

JvK is just the man to rectify the situation. What took him so long?

[dr biotech] 22/2/2019 07:40

Looks like a nil premium takeover just to sack the board.

[melmoo] 22/2/2019 07:32

Hopefully there will be no unexpected surprises next week.Hoping for better than
expectations just to see some upward price movement.Fingers crossed,just like last year!

[theborn] 15/2/2019 14:39

I’m going to repost what I’ve said in another group:

Per 2018 interims:

Shareholder equity £678m. Taking this over the 253m shares in issue = £2.70 of asset value per share on B/S at that time.
Assuming a statutory PAT for H2 2018 of c.£50m = £0.20p of further asset value per share on B/S.

So on a current share price of £4.95....nearly £3.00 of that is current value.
Meaning future return prospects are priced in at only £2.00?!?

I know PFG have had their issues but I struggle to accept there isn't a huge market overreaction here, regardless of the 'profit warning' which wasn't a profit warning in the traditional sense. PFG stating adj. profit 4% lower than the mid range (but still within the full range) has knocked 25% off the share price. Madness.

With the bulk of the regulatory and home credit issues put to bed, plus even factoring in tightened underwriting and borrowers being cut some slack on payment arrangements, there is no reason PFG won't be forecasting (and hitting) adjust profit target of >£200m for 2019 (on basis of Vanquis / Moneybarn zero growth and Home Credit not adding anything to P&L)....this is 80p per share.

Any way I look at it, going long at any price close the current £5 represents significant RV opportunity and risk adjusted upside.

No doubt the PFG Board will make me eat my words by announcing 2018 figures below the £151m bottom end on adjusted P&L, but regardless of that, the future value here is still very appealing.

Viewing on a medium term time horizon there is a very real chance the share price will double, if not treble, on today's value if they continue to work with the regulator and focus on sensible underwriting. Factoring in a dividend policy of paying out c. 70% of PAT I can't see many other income and capital cash cows available at this type of value. I’ve been loading up.

[bazegan] 15/2/2019 14:27

Don’t like that PFG has fallen below 12m low of £5
Am watching it but not seeing any news so can only speculate it might be nervousness ahead of preliminary results announcement in case it’s drlivers an unpleasant surprise that I’d worse than content of trading update maybe?

[mj19] 15/2/2019 10:58

Is £4 coming

[bazegan] 08/2/2019 21:45

Preliminary results out on 27th following trading update so hope no nasty surprisesFinancials seem to be reacting badly to Brexit uncertainty and recent fall below £5 was point I was poised to buy but I’m really nervous and don’t have the cohones just now. Should be doing better but maybe too early in turnaround story to attract institutional buying?

[slypaul] 07/2/2019 14:09

The management is lousy. For a company that has lasted for decades, and is in the ONE growth sector ((i.e DEBT DEBT DEBT)) in this funny economy of ours, not to be doing well, just shows how lousy or being out of touch the past or recent current management had/has been. The home credit section is just one component of the company. Vanquish and MoenyBarn sections are doing ok, and given the fact that they comprise around 50% of the turnover, i reckon the fall in price from 2016 is overdone; and mainly due to lousy management and over-zealous politicians. A special dividend and dividend rate of more than 10% would have been what the management should do to stop this slide and news article like these. The company is well funded. They should also seek better PR and point out that the public too, own shares in this company; and that it is immoral and perhaps illegal what some over-zealous politicians are doing to it.

[paulab203] 18/1/2019 19:43

£150m gives EPS of close to 50p and I think next years cover is stated at 1.4. Assuming PFG stands still next year and makes the same £150m that suggests a divi of around 35p = yield of call it 6.5%. That really assumes no contribution next year to profits from CCD which seems unlikely, Wont be going back to £23 anytime soon but if you think CCD will start to contribute next year then looks quiet reasonable value IMHO. IMHO Vanquis on its own is worth this price and everything else is currently in for free

[richardbrook1] 16/1/2019 16:01

I agree. I think yesterday was not bad or good news. They are going to pay a nominal dividend this year and then pay full after that. I remember this stock being tipped in the times for being able to get back to £23. Just a matter of patience

[minerve] 16/1/2019 10:49

I don't think the RNS was that bad. I think expectations by some investors had got ahead of themselves. This is going to take years to get back to some resemblance of what it once was. The relationships that were damaged have gone and new bonds will take years to form.

Demographics still fit PFG well.

[bookbroker] 16/1/2019 09:03

Not necessarily, the issue that seemed to concern the market were the potential for rising delinquencies with the Vanquis card holders, in the old days when PFG relied pretty much on door to door lending this was easy to resolve due its simplicity, and the customers being monitored in a more personal way, now it is probably done by letter and they just do not open them! Otherwise the statement was generally ok, but Vanquis is seen as the prime product within the PFG portfolio!

[fenners66] 16/1/2019 00:42

Have all the measures gotten worse since the first half ?
In isolation that RNS did not read as bad as the share price suggests ..