Punch Taverns Share Discussion Threads

[amelio] 12/1/2010 10:31

I sold yesterday at a healthy profit - will have a look where this moves later.

[lagosboy] 12/1/2010 10:12

As I said, be careful, this is being traded, underlying fundamentals have yet to improve.

[ant15] 11/1/2010 16:59

This crew owe me money and you cannot believe the problems I am having getting it anyone would think they are without!!!!All is not gold here for certain!!!

[amelio] 11/1/2010 12:21

Cheers QS9

[qs9] 11/1/2010 08:26

GOodstart to the day

[lagosboy] 08/1/2010 16:13

Well done all you longs, I had fun 82 to 71 pence before getting out so good luck but be careful.

[qs9] 08/1/2010 16:07

well done amelio....nice 10%...!

[qs9] 08/1/2010 15:10

May see 80p next week if this can hold. Decent volume today.

[amelio] 08/1/2010 09:16

Had a first time punt at 69p on this one earlier in the week so hopeful for a decent rise.

[qs9] 08/1/2010 09:04

Already there, reckon 10% short-term at least, in for the ride first thing...

[amelio] 08/1/2010 08:59

Agreed. Short-term trend looking good now. Would like to see a close above 73p.

[qs9] 08/1/2010 08:29

Decent start, may find some more support me thinks any views?

[qs9] 08/1/2010 08:24

Will read across from Marstons help PUB? seems to be attracting some buying interest IMO...

[lagosboy] 29/12/2009 15:12

Thanks for the links...interesting.

Not sure how it fits with todays positice share price bounce of 4.5%?

[lagosboy] 29/12/2009 11:21

HampsterApe

What is your long term view for Punch. I was short pre the trading update but am sitting on the side at the moment.

I can see nothing but hard times ahead for the UK economy and this sector in 2010.

I feel the share will drop to circa 50 pence, what's your view ?

[hamsterape] 28/12/2009 20:21

The argument that debt is bad or not bad depending on the fashion is
fundamentally flawed.

Taking on debt to expand the business is one thing, but having a
declining business that already has outstanding debt from
earlier transactions, possibly done at much higher prices than
would be achievable in the current market, is quite another.

It's a bit like arguing that borrowing money to buy property to
let out at a profit is a good idea, and that therefore a buy-to-let
landlord already up to his eyeballs in debt is not in a worse
position than a rival landlord with much lower debt when both are
competing for price-conscious tenants in a shrinking market place.

The only advantage to us guys of the company having a huge debt pile
is that it makes the shares very volatile and likely to rise substantially
in the (many think unlikely) event that the company makes a sustained
recovery without issuing more equity or selling off most of the assets
that generate the hoped-for profit in the first place.


On the earlier subject of share buy-backs - I too would be really annoyed
if the idea of a special dividend had been tabled and dropped in favour
of a share buy-back (usually argued due to supposed tax advantages).
The good thing about a return of cash as a special dividend is it takes
the money out of the company's coffers and therefore removes the
possibility of the management losing it in the future. It's a lot harder
to justify a proposed acquisition to your shareholders if you have to
make an appeal for more money via a rights issue than if the money is
already sitting in the company's account.

I'll paint an analogy here with cashing out of a poker table after a
particularly long run of good cards and buying back in at another table
for a much lower amount to continue playing without risking all your
profits by somehow ending up all-in on a near coin-toss draw.

[desperate dan] 24/12/2009 10:45

Certainly agree that it is perception at any one given time. As jeffian quite rightly pointed out, it is whatever the "fashion" happens to be. The PUB model is currently very much out of fashion.

I know that I will be opening a couple of chilled bottles of Bollinger before dinner tomorrow on the back of PUB. I may even propose a toast to the Finance Director and the senior management of the company - for running it into the ground!

[jazza] 24/12/2009 10:33

DD,

That comment wasn't levelled at you in particular..

..but there is a lot of that kind of thinking out there..which is odd given, as you say, "it is a fundamental of capitalism and commerce."

"bad" debt is often more about perception than anything else...it aint bad when profits/assets/economies are inflating...that's why there is a transient nature to all of this!

Working that out is simple, working out the timing is the tricky bit!

:-)

[desperate dan] 24/12/2009 10:23

jazza,

I have never said that all debt is bad. It is a fundamental requirement of capitalism and commerce.

What I am saying is that bad debt is bad - that is where PUB is currently positioned, given the view of the markets at this time. The "at this time" perception will certainly change, but not in the forseeable near future.

Merry Christmas to you too.

[jazza] 24/12/2009 10:09

DD,

This goes with my post 1090...the market can & will (as we are seeing) think whatever way it likes...but that thinking also can & will change.

When you spot BS like the current "all debt is bad, all liabilities are losses, assets are worthless" that is routinely peddled, you know the zeitgeist reflects a world trying (and failing) to account for the extraordinary events of the last few years....a complete over-reaction...which is saying something given the enormity of said events.. :-)

It's called drama-queenery....we are all so self-absorbed we think the world really will end while we are still here to witness it.

I'm thankful that its an odds-on bet that I won't be that unlucky..

Merry Christmas!

:-)


Desperate Dan - 23 Dec'09 - 22:56 - 1088 of 1091
... the institutional investor perspective has changed dramatically. No matter how you work the numbers, an over-leveraged business model (in the manner of PUB), will not be currently accepted.

[jazza] 24/12/2009 10:04

Completely agree jeffian.

Visit any of the "house price crash" threads on advfn...when they actually get to talking about the housing market (not often anymore 'cos it won't actually crash!) the general air is of bewilderment..."why won't it crash like in the 1990's"....lols, absolutely no attempt to understand the mechanics of the market...cheap money is errrr CHEAP!!!

Of course, you could talk about interest rates soaring from current levels...but talk is cheap, where is the catalyst?!

:-)



"Last time (1990's), what caught out the over-geared was the massive rise in interest rates which meant that the interest became unserviceable and resulted in forced sales into a falling market and massive asset-value destruction."

[jazza] 24/12/2009 09:59

Aye, I sometimes wonder what happened to the world and the way people think..

We've always had mortgages, we've always borrowed money with the promise of servicing/repaying the debt and it works quite well.

Not in "credit crunch" world it seems, every liability is a loss, every debt a harbinger of doom.


It's all a complete load of BS of course. If that's the zeitgeist, than that's where we are and that's why the market is where it is...that doesn't stop the realist seeing through the nonsense and waiting for public/market opinion to come back to planet earth..

:-)



"What is so "flawed" about that? It's the way most of us run our lives!"

[seahorseleisure] 24/12/2009 09:35

Got to say that this is probably the most interesting thread I've read on Advfn for many a month with points well argued and backed up.

This may even give me my faith back in the usefulness of bulletin boards.

FWIW, I'm coming down on Ian's side, PUB and ETI are in difficulties but there may well be some money to be made when these turn as it's extremely unlikely that they are going bust.

I have been short of both these during 2009 (closed too early by the look of the current price) but wouldn't short these shares at the minute and feel that the worst is probably behind them although I do think that the high street (leisure) has more pain to come.

However, the one overriding point is that, whatever happens in the economy or in peoples lives, pubs and going out are here to stay. Its a question of 'what level is appropriate value?)

Have a great Christmas all, and best wished for 2010

SH

[desperate dan] 23/12/2009 22:56

Good stuff jeffian. I do enjoy a measured argument!

Your evidence is more detailed than what I consider to be a general market view ...

... the institutional investor perspective has changed dramatically. No matter how you work the numbers, an over-leveraged business model (in the manner of PUB), will not be currently accepted.


It is certain that the asset values quoted on the balance sheet will be overstated (hence my comment about the balance sheet figures being shored-up (standard accountancy practice after all). Basically, ask the question - on which valuation? (non-audited valuations, no doubt).

You and others consistently refer to revenue stream as being the panacea to servicing levels of debt (in the same way as one would with a domestic mortgage) ...

... major correction (if I may):

... the comparison is worlds apart.

The accounts can be manipulated to read however you would like them to be preceived. Revenue to service debt - no problem whatsoever! Book value to generate a placing/rights issue - no problem whatsoever (entirely depends upon the criteria or accepted standards as to how you value the book!).

The end result is that the PUB revenue stream cannot (and in no way can)service the debt - either by cash (current or prospective), or a questionable asset value.

PUB are in a cul-de-sac where, without an unlikely white knight, there is no return.

I think I'll take my position of currently being out - rather than your position of being in.

Again, I do accept the possibility of a bounce opportunity approaching Spring.

and again, Happy Christmas!

and further again, please - don't accept my pontifications - look at the price chart.