Share Name Share Symbol Market Type Share ISIN Share Description
Provident Financial Plc LSE:PFG London Ordinary Share GB00B1Z4ST84 ORD 20 8/11P
  Price Change % Change Share Price Shares Traded Last Trade
  -1.60 -0.34% 465.40 718,547 14:01:59
Bid Price Offer Price High Price Low Price Open Price
465.50 465.90 468.00 464.40 466.80
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Nonequity Investment Instruments 1,124.40 90.70 25.20 18.5 1,179
Last Trade Time Trade Type Trade Size Trade Price Currency
13:54:13 AT 261 465.40 GBX

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Date Time Title Posts
15/2/201914:39Why is the management of this company letting over-zealous politician destroy it4
15/8/201712:25good for a short on tonights PANORAMA?7

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Provident Financial Daily Update: Provident Financial Plc is listed in the Nonequity Investment Instruments sector of the London Stock Exchange with ticker PFG. The last closing price for Provident Financial was 467p.
Provident Financial Plc has a 4 week average price of 454.10p and a 12 week average price of 402p.
The 1 year high share price is 636.20p while the 1 year low share price is currently 348.70p.
There are currently 253,284,814 shares in issue and the average daily traded volume is 1,216,542 shares. The market capitalisation of Provident Financial Plc is £1,178,787,524.36.
masurenguy: Cheers paulab203. Some more comment from PH. Doorstep lender Provident Financial has faced a number of regulatory problems over the past few years but analyst Stuart Duncan says it is now focused on growth, although that is not acknowledged in the share price. He said there were a ‘number of opportunities to improve returns range from product extension to funding efficiencies’ and the business is expected to ‘generate a return on equity of 20% to 25% by 2021 and dividend cover of at least 1.4 times’. ‘If we translate the return on equity target into earnings, taking the mid-point, the business could deliver earnings per share of at least 60p, and would yield circa 9% if we assumed dividend cover of 1.5 times’ said Duncan.
robinnicolson: That doesn't explain the 7.9% share price rise on one stage up more than 10%. Maybe there was a broker upgrade.
bookbroker: Would have been better had PFG not made a counter offer against NSF, the weakness in NSF share price has now had a detrimental effect on PFG, Woodford once again to blame, I see him in the dock down the line over his gross mismanagement of assets, the bloke still refuses to admit to his misguided hubris! The belief that he is infallible when it comes to investing capital! As soon as the restrictions in place on redemptions are lifted, you will witness a rush for the exit!
porsche1945: If Cannacord move to sell its a defo buy, Cannacord probably the worst broker, and thats saying something, at share ratings, truly abysmal and always wrong. A Canadian company whos own share price is in the dirt, that maybe is better sticking to Canada. That idiotd Woodford still having to unload these, when it stops and hopefully he is out for good, share price will recover.
dual: Woodford in trouble... this is probably why PFG share price has fallen for the past week.. Woodford will need to sell.I think this is the beginning of the end of Woodford Investment and with it NSF.
grahamg8: Sorry Invictus "PFG" don't get to choose the take out price. The shareholders do. And according to NSF it's all done and dusted. IF a rival bidder can be teased out then the price could be driven up. Try to be too greedy and NSF will simply walk away and the PFG share price will drop like a stone. It isn't exactly clear what the NSF shareholders get out of this, so the biggest hurdle might be getting them to agree to the deal at the current offer price.
dexdringle: This is most odd..... Firstly NSF announce a 'firm' offer but no immediate response RNS from PFG who take three and a half hours to announce that they haven't yet got a response. So, presumably, they had no idea this was coming. NSF state that they have the agreement in principle from more than 50% of PFG shareholders meaning that, before the announcement, they must have discussed the proposed plan with some shareholders and not others. The PFG share price is now nearly 10% above the offer price based on the current 62p NSF share price x 8.88.
theborn: 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.
umitw: PFG share price is a bit like Bitcoin! LOL
spob: Paul Scott Small Cap Value Report from yesterday Tuesday, Aug 22 2017 Good Evening, it's Paul here. Sorry my report is late today. Provident Financial (LON:PFG) Share price: 589.5p (down 66.2% today) No. shares: 148.2m Market cap: £873.6m Trading statement - this is such an interesting announcement that I feel obliged to mention it. This company is a UK sub-prime consumer lender. Its divisions include Vanquis Bank, the Consumer Credit Division (comprising Provident and Satsuma), and Moneybarn. Looking back to its 2016 results, the group made an adjusted profit of £334.1m, and paid 134.6p in dividends to shareholders. The share price was riding high, at about 3000p in late 2016. Compare that with today, at just 589.5p - that's a share price fall of about 80% this year. Its interesting how, when a share really collapses, there are often clear warning signs in previous announcements. That seems the case here. The most recent interim results were poor. They also contained worrying comments about several FCA reviews affecting the company. Also, disruption was reported from a change in the business model at the CCD - moving from self-employed, to employed operational staff. This was supposed to be a compelling change in business model. EDIT - a couple of brokers have flagged up that competitors are saying that large numbers of the best sales agents are jumping ship from PFG, to join competitors such as Morses, and NSF. This sounds ominous to me, and could mean that profits may not necessarily recover at PFG. Today's announcement has to be one of the worst profit warnings I've seen. The wheels seem to have completely come off at the CCD. This bit from today's announcement sounds awful; The rate of progress being made is too weak and the business is now falling a long way short of achieving these objectives. Collections performance and sales are both showing substantial underperformance against the comparable period in 2016. The routing and scheduling software deployed to direct the daily activities of CEMs has presented some early issues, primarily relating to the integrity of data, and the prescriptive nature of the new operating model has not allowed sufficient local autonomy to prioritise resource allocation during this period of recovery. Things don't get a lot worse than that. It sounds as if the new business model has been an unmitigated disaster. Unsurprisingly, the CEO has now gone. As a result of these problems, debtor collections have fallen a long way short; Collections performance is currently running at 57% versus 90% in 2016 and sales at some £9m per week lower than the comparative weeks in 2016. The extent of this underperformance and the elongated period of time required to return the performance of the business to acceptable levels invalidates previous guidance. The pre-exceptional loss of the business is now likely to be in a range of between £80m and £120m. It looks as if the customers are possibly taking advantage of the lender being in a shambles, to decline to repay their borrowings? This raises a big question mark over whether bad debt provisions are adequate? That's the inherent weakness with sub-prime lenders. They can report big profits for a while, then often it becomes clear that many debts have gone bad, and won't ever be collected. So a huge write-off then has to be done. That's the main reason why I would never invest in any sub-prime lender. Divisional profits - to get my head round the numbers, I've looked back at the 2016 results, and this shows the group's profitability as follows; Vanquis Bank £204.5m CCD £115.2m Moneybarn £31.1m Central costs -£16.7m As you can see, Vanquis was the biggest profit earner within the group. Interestingly, today's statement says that Vanquis is still trading alright; The trading performance of Vanquis Bank, Moneybarn and Satsuma remain in line with internal plans. Therefore I'm wondering if the problems are confined to the CCD part of the business, there could possibly be a value opportunity here? FCA investigation into ROP - this is the product from Vanquis Bank called Repayment Option Plan. New sales of this were suspended in Apr 2016. However, Vanquis is currently generating £70m in revenues from this product, which seems to have been sold between 1 April 2014 to 19 April 2016. EDIT - one broker suggests that the ROP product generates 20-25% of Vanquis's profits, this issue is of considerable significance. It's not clear what the outcome of this investigation will be. However, it sounds like there could be a risk of some kind of customer compensation liabilities, if the FCA decides that the product was flawed. Dividends - are off the table for the time being; In view of the substantial deterioration in the trading performance of the home credit business, together with the uncertainty created by the FCA's investigation at Vanquis Bank, the Board has determined that the group must protect its capital base and financial flexibility by withdrawing the interim dividend declared on 25 July 2017 and indicate that a full-year dividend is unlikely. Sounds sensible, in the circumstances. Will it go bust? That's the key question. I've looked back to the latest balance sheet, and it's actually not bad. You would expect this type of business to be groaning with bank debt. Its business model is to borrow cheaply, on a large scale, then lend very expensively, on a small scale, to people who are desperate, hence can be ripped off. The high customer default rate should in theory be more than covered by the huge profits made from customers who do repay their borrowings. In an economic downturn, customers often default en masse, and this type of business therefore often goes bust in a recession. We're not actually in a recession, although there's little doubt that household incomes are feeling the pinch somewhat right now. Interestingly, PFG had (relative to its receivables book) fairly low bank debt - a £450m syndicated bank facility. It seems to be mainly financed through taking retail deposits into Vanquis Bank - which was a larger figure of £941.2m at end Dec 2016. So Vanquis Bank looks a fairly ordinary savings & loans type of bank. Therefore, to my mind, the main risk to this group is if depositors are scared off, and withdraw their deposits. As we saw with Northern Rock, once such a bank run starts, it can't usually be stopped without a Government bailout. PFG looks much too small for a bailout (if needed), so who knows? EDIT - this risk may not be as bad as I feared. Apparently Vanquis takes term deposits (e.g. 1 -5 years). So that should limit the damage from depositors withdrawing funds. I think the key question is whether depositors can withdraw funds before the term has expired. Often that is possible, but carries an interest penalty. Therefore I think the ability of depositors to withdraw funds is an absolutely key question mark here. My opinion - this is one I'll be watching from now on. What interests me, is that the key value in the share seems to be Vanquis Bank. That doesn't seem to be affected by the problems in the CCD part of the business. Although if the FCA review goes badly, then more, potentially serious bad news could be on the way. I loathe this type of business. The way I see it, they prey on financially weak people, by offering loans to people who really shouldn't be borrowing at all - because they are poor. I have friends who have (stupidly) borrowed from Vanquis, and I ended up bailing them out, because the high interest charges compounded so rapidly, that my friends soon ended up being overwhelmed by what was initially only a small debt. So personally I have zero sympathy for shareholders here. As far as I am concerned, the losses that PFG shareholders have suffered here are a well-deserved punishment for trying to enrich themselves at the expense of the poorest people in society. I know some readers disagree with me on this, as we've discussed it here in previous reports. There are some good lessons from this situation; 1) Selling on the first profit warning is usually the best course of action, when it looks as if something serious, and structural is going wrong. Looking back, there were clear signs in Jun 2017 that something was going badly wrong at PFG, with the reorganisation of the CCD. 2) Management were clearly foolish to tamper with a previously highly profitable business model. So I'll certainly be wary in future, of any company where a big change in business model is being implemented. Do management have the skills to control, and change a business? Clearly in this case, no they didn't. 3) Regulatory risks - the FCA seem to be looking much more closely at businesses like this, which essentially rip-off the poorest consumers. So to my mind, sensible investors really should avoid any business which is over-charging the poorest part of society. The regulatory risks could blow up at any time. Who knows where & when the next mis-selling scandal will blow up? 4) Big dividend yields are often a signal from the market that something is going wrong - and those big divis may not be sustainable. So I would look very carefully indeed at any share where the divi yield is above say 6% - that seems to be roughly the cut-off point where we have to tread much more carefully. Stockopedia is showing an 8.16% forecast dividend yield as of last night, just before the profit warning. Such a figure is well into danger territory. Overall though, I think this share is probably too risky to have a punt on now, without doing a lot more research. Although I think the value in Vanquis could now be more than the entire group market cap, maybe? That depends on how much profit is derived from the ROP product, which is not disclosed in today's announcement. Also, would I really want to hold shares in an exploitative business like this? No. I see that Woodford funds own 19.9% of PFG. Another disaster for them. I do wonder how much real due diligence they're doing? If it's just a scatter-gun approach, with little original research, then investors can do that themselves, without needing a fund manager. 599c7b84d613aPFG_chart.PNG EDIT - my thanks to Clouds, who kindly flagged up Neil Woodford's blog, with his response to the PFG profit warning. He reckons it's ridiculously cheap now, and should recover. Hmmm... we all say that, don't we. Interesting to see that a top fund manager is suffering from the same behavioural biases that novice private investors are often criticised for - averaging down on losing positions. The trouble is, big funds with big positions, often can't sell, even if they want to. Plus, the moment an RNS comes out, showing a big fund manager selling, then confidence in the share slips further. It will be interesting to see whether Woodford recoups his client funds on this one, or not. It will also be interesting to see how long his blog will continue to allow comments, given how critical a lot of them are (understandably)!
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