Provident Financial Share Discussion Threads

[sippguru] 07/2/2018 08:15

chucko extreme maybe but i strongly believe its warranted. In my mind i've already written off the prospect of a successfully underwritten bond in the near future given the current state of the business thus repaying debt from cashflow becomes a real prospect.

[chucko1] 06/2/2018 21:29

Sippguru, that is quite an extreme statement! The repayment of the bonds need not come from cash flow now, as they would look to refinance the bonds upon maturity. Of course, that depends on there being willing bond buyers and these would be scarce in the event of perceived future insolvency.

But for now, it is profits which may well be scarce and that is the reason for a 700p share price. The market is looking for a loss this FY followed by profits of reasonable magnitude thereafter. So long as the business model is thought to work, and it has done so for a century or so, just about any cash shortfall could be financed. In terms of the unknown scale of the FCA fine(s), I would say that the FCA is not in the habit of putting financial firms of reasonable standing out of business. Even the likes of Wonga were allowed to survive, although hopelessly diminished since they were nowhere near acceptable regulatory standards. PFG’s lending is far more “bank-likeR21; but were I a shareholder (I am not) I would be quite nervous about the capital hit that I might take from the forthcoming FCA pronouncements. This is why I prefer the bonds at an 8.5% yield for the next five years rather than perhaps far more upside from the shares, but with virtually no margin of safety.

I own the 5.125% 2023 bonds priced around 85% but the ones referred to in the previous posts were the 8% 2019 and they are priced around 94.5% to yield about 11.5%. In the most recent market turmoil including the fears about a PFG rights issue, these bonds moved by no more than 1.5%.

[sippguru] 06/2/2018 16:52

fenners i see no way in which cashflow will enable PFG to repay bondholders. I suspect some sort of debt for equity deal coming up, if the FCA fines are as sizeable as some have suggested PFG could be about to hit the perfect storm. Lets face it we all know how dishonest they have been with RNS to date, i don't believe a single word i read from this bunch now, well maybe the last two, ---------The End--------

[umitw] 06/2/2018 14:11

Invesco Ltd/ Atlanta increased their position from 22.05% to 23.14%

[fenners66] 06/2/2018 13:53

chucko1 - I am looking up the 8% 2019 bonds and they appear to be trading at around 94.6 so a long way from 70.
At that price they do not look as much a bargain.

Has made me wonder if there are opportunities here though.

I bought shares instead of the bond because the yield was better ( when I bought them) and I got a gain as well.

Sold the shares as the yield dropped - maybe time to look at the bonds...

[sippguru] 05/2/2018 17:37

smurfy, try taking one of the zeros away. it's more likely.

[smurfy2001] 02/2/2018 18:27

Back to 900p?

[losos] 02/2/2018 13:14

umitw - "Seems like the market likes the news so far!"

That's the 'acid test' in my opinion. Still plenty to do, so let's hope they get stuck in PDQ :-)

[umitw] 02/2/2018 13:04

Seems like the market likes the news so far! :-)

[umitw] 02/2/2018 09:12

Once PFG resolves the issues with FCA THE SHARE PRICE Could ho up £1 on the day, as long as the agreement is satisfactory.

[scemer] 02/2/2018 08:44

Fair point sipp but the key for me is discussing with key holders and FCA

[sippguru] 02/2/2018 08:34

Not harsh at all, they went looking for a new CEO, a process they originally claimed was led by Malcolm Le May, they come back 6 months later and it would appear Malcolm Le May has appointed Malcolm Le May (oh and all of a sudden the process was led by someone else). You've got to wonder why they couldn't find a suitable external candidate. Seems they forgot that they issued this statement in November 2017:-

Provident Financial plc ("the Company")

28 November 2017

Board changes



Further to the statement on 24 November 2017 the Board of Provident Financial plc announces the following changes to the Board and Committee structures with immediate effect: As previously announced, Malcolm Le May has been appointed as Interim Executive Chairman and will also assume the role of Chairman of the Nomination Committee and in that role he will lead the ongoing process to appoint a new Chief Executive of the Company.

[ccnp] 02/2/2018 08:31

There is one continuing dishonesty/misrepresentation by PFG that I find interesting. PFG always refers to 'discussions' with the FCA.

That's a bit like saying someone the police have pulled in is having a 'discussion' as opposed to 'being questioned under caution' or 'helping police with their investigation'.

PFG is under investigation - effectively under caution. It is not having a discussion.

It would be lovely if the FCA put out a statement slapping them hard for the lie.

[scemer] 02/2/2018 08:23

Bit harsh sipp when you read all their history

[sippguru] 02/2/2018 07:13

oh dear, failed to attract an external candidate to replace the fat crook. Doesn't matter how they spin this its a huge snub that nobody was interested.

[smurfy2001] 02/2/2018 02:45

Sky news ceo appointed....

[losos] 31/1/2018 14:43

CC2014 "don't even start me on some of his holdings in WPCT where he just seems to be throwing good money after bad."

Just had a look at WPCT it's not for me but you have to admit that where the yanks and others have excelled is backing early stage companies and sticking with them. In UK that is a rare thing. WPCT shareholders need at least a five year view, in fact I would say a ten year view.

Who knows what the world will look like in ten years, Will PFG & CPI still be around :?: Don't know about you but I'll just be happy to still be waking up in the morning haha.

[tim 3] 31/1/2018 13:53

He is in cpi in a big way and was a top 10 holding of his fund and has been buying all the way down again as recently as December.

[umitw] 31/1/2018 12:02

It doesn't pay to be a short termist. Woodford is a long term fund manager. Black Rock, UBS are buying in as well. So looking forward, may be they think it will recover!Not necessarily it will go back to £30 but may be double from here.

[meijiman] 31/1/2018 11:10

His 'success' was linked to marketing not stock selection...sucked in the retail money.

[smurfy2001] 31/1/2018 11:09

Woodford is also in CPI?

[my retirement fund] 31/1/2018 10:54

He is a spectacular failure. Christ knows how he got a reputation for being a knowledgeable fund manager.Ive got more talent in my little finger even the Daily Mail money section are becoming fearful of talking him up after several years of praising him as some kind of Warren Buffet.Hr is not even fit to lick the dirt of Buffets shoes !!!

[cc2014] 31/1/2018 10:46

The other fund managers must be laughing at him. Every time they have an issue he takes their stock off them and just keeps adding and adding like an inexperienced PI.

He also seems to seek out businesses which are risky in the same way PI's tend me.

So, now he has no dividend flow on either PFG or CPI and don't even start me on some of his holdings in WPCT where he just seems to be throwing good money after bad.