R&q Insurance Share Discussion Threads

[red ninja] 10/8/2020 09:38

It does, but the market has no reaction.

No buys or sells and the price has flat lined for a few weeks.

[jonwig] 10/8/2020 06:14

This looks a pretty good deal -

[red ninja] 18/7/2020 09:05

HL sent me a message yesterday that bonus shares would be added yesterday. Still not added though. I guess they'll be in on Monday.

[jonwig] 17/7/2020 11:58

Yes they're credited in my ii acc.

[alter ego] 17/7/2020 11:20

still waiting for my bonus shares to appear in my HL account. Anyone else got theirs?

[red ninja] 14/7/2020 08:18

I agree no difference in underlying value of holding.

However, I also expect to see a mark down tomorrow and selling pressure as people sell the new shares for income.

[breezer_42] 14/7/2020 08:13

The bonus shares don't have any impact on the value of the business or your holding. What the issue does is effectively take some of the capital value of the business and make it count as income. This allows institutional income investors, whose mandates often prevent them from selling shares to create distributable income, to sell these new shares (which count as income because they've been given out by the company) and distribute the cash to their investors.

As such we may see some selling pressure in the coming days, but I doubt it'll be people exiting positions.

[red ninja] 14/7/2020 07:19

So the bonus shares trade ex-entitlement tomorrow :-

"Randall & Quilter Investment Holdings Ltd. (AIM:RQIH), ("the Company"), the global program underwriting management and legacy acquisitions specialist, confirms that the date on which the Company's Bonus Shares, as proposed in the Company's Notice of Annual General Meeting published on 15 June 2020, will commence trading ex-entitlement will be 15 July 2020."

[speedsgh] 09/7/2020 11:43

Ken Randall Announces Retirement Date -

The Board of Directors of Randall & Quilter Investment Holdings Ltd. (AIM:RQIH), today announces that Ken Randall, Executive Chairman of the Company and co-founder of R&Q, has notified the Board of his intention to retire as Executive Chairman and step down as a Director of the Company with effect from 31 March 2021...

... Ken Randall, Executive Chairman, said: "Today, the opportunities for R&Q are arguably the greatest since I founded the business with Alan nearly 30 years ago as the significant secular growth in our two core markets, legacy and program management, continues to accelerate. In addition, the strength of the management team we have built gives me great confidence in our ability to capitalise on these opportunities...

[jonwig] 09/7/2020 06:02

breezer - thanks for comment. For some reason I haven't seen the company's presentation, but the same points are covered in the Hardman analysis.

[breezer_42] 08/7/2020 12:18

Interestingly if you look at pg 14 of their latest presentation they give some idea on how to think of thge valuation, basically giving management's view on which peers each business resembles, explaining the levels at which those peers are valued, and then explaining that R&Qs business lines actually outperform the peers:

The Program Management business is most similar to global Insurance Brokerage businesses (a list of brokers is in the appendix)
- Annual recurring fee-based business
- High pre-tax margins
- Scalable with limited capital required for growth
- Key performance indicators for Insurance Brokers are growth in Revenue and EBITDA as well as EBITDA margin
- Over the past 5-years, publicly traded insurance brokers have traded at 3.6x LTM Revenue and 16.4x LTM EBITDA

The Legacy business is most similar to global Specialty Insurance companies (a list of Specialty Insurers is in the appendix)
- High and stable returns on capital and equity
- Strong, non-cyclical growth
- Key performance indicator for Speciality Insurance companies is Return on Net Asset Value
- Over the past 5-years, Specialty Insurance companies have traded at 1.99x Net Asset Value.

Our businesses have higher growth and stronger returns than the comparable companies
Program Management has a 280% CAGR (’17-’19) in Commission Revenue vs insurance broker average of 8%
Legacy has a 5-year Operating RoAE of 20.2% vs Specialty Insurance companies average ROAE of 9.4%

[jonwig] 08/7/2020 10:43

Yes, it's sponsored research. I'm not happy with lumping RQIH int a 'sector' - it doesn't fit well with general (or Lloyd's) insurers.

[red ninja] 08/7/2020 09:51

It reads well, but I believe it is research paid for by RQIH so not independent.

I see ED state RQIH is 66% undervalued in comparison with sector, but if you raise cash at 135p a share, you can't really expect investors to chase them too far above that level.

[edmonda] 07/7/2020 14:48

Record FY19 results from Randall & Quilter saw a combination of strong Legacy deals and growth in the scale, product range and reach of Program Management.

Group looks well set / able to benefit from covid disruption to insurance, and its shares appear materially (2/3) undervalued v sector and prospects.

Read new detailed research note from Equity Development here:

[bisiboy] 27/6/2020 16:33

reason is to keep retail funds sweet. they can class shares as income and distribute more as a result. otherwise I agree pointless exercise unless the future growth in dividends per share is higher than it would otherwise have been.

[red ninja] 24/6/2020 11:27

A trade at 12:06 for 3.5 million at 174p today looks like a buy and a vote of confidence.

Note, I say buy as on HL platform it gave me a buy price at around 174p today.

[jonwig] 06/6/2020 10:48

According to their RNS, Invesco sold about 10.8m shares on 03/06 and told the market on 04/06.

The five biggest trades late on Friday 05/06 totalled some 9m shares. I wonder if those were Invesco's, late reported? (You can't definitely stamp them as buys.)

Anyway, 9m shares is 4.2%, so we may get another RNS if somebody else is involved.

[red ninja] 06/6/2020 10:31

I notice that about 9 million RQIH shares bought just after 4pm on Friday (in several trades).

Possibly Invesco selling out their remaining stake in RQIH ?

[jonwig] 05/6/2020 06:41

Yes, actually shows why not paying a cash dividend is a good thing (maybe should make it standard). These legacy deals book a big upfront profit but cost cash long before it starts coming back.

[rik shaw] 05/6/2020 06:20

Another acquisition

[this_is_me] 04/6/2020 21:56

Yes didn't affect the price. They must have found a home for them.

[speedsgh] 04/6/2020 18:04

Invesco have reduced from 9.49% to 4.40%...

[pldazzle] 04/6/2020 10:08

alter ego - that's a fallacy. If Company X pays (say) £1m in dividends and has 100m shares, the shareholders get a div of 1p/share. If Company X then issues 1m bonus shares, the div reduces to 0.99p(approx) per share. If you held 1000 shares, you now hold 1010 shares and get exactly the same dividend as before.

[alter ego] 04/6/2020 09:47

well you obviously cannot please everyone, but I'll take all the future dividends on those extra shares as adequate compensation for the loss on one cash dividend payment.