Ramsdens Share Discussion Threads

[shanklin] 26/6/2018 17:04

Given the combined sell is just under 3% per my earlier post I imagine somebody or institution expressed an interest in buying 925k shares at a discount to the prevailing price and these sells are the response.

[manrobert] 26/6/2018 16:44

allat the same time?

[gorse] 26/6/2018 16:43

It may well be that Ramsdens' directors are prudently rebalancing their portfolios assets - but still retaining substantial stakes in the business. So, it may be good news in reaffirming that Ramsden has a management team who are smart cookies.

[topvest] 26/6/2018 16:35

They are retaining big stakes, so whilst not the most positive of signals it probably just means that they want to cash out some of their stakes. Not unreasonable.

[xajorkith] 26/6/2018 16:15

Yeah, sold out too regrettably despite the apparent value here.

Not taking any chances after XLM & agree that Directors selling en masse not the most positive signal, along with a move below the 200 day MA.

Remains on my watchlist though & GLA who continue to hold.

[igoe104] 26/6/2018 16:12

Always disappointing when directors sell, and kick off lots of stop losers. but as we know from results a couple of weeks ago the business is going extremely well, someone / fund will be picking these shares up on the cheap now, at the expense of PI.

I popped in a Ramsdens store in Swansea (whilst on a cricket trip) to buy some currency last week, and was very impressed with the service, the staff seemed very well trained.

[cheshire man] 26/6/2018 15:41

Stop loss hit and out at breakeven,,,,,,,glad I had set one,I'll be staying out for now

[firtashia] 26/6/2018 15:30

I realise that they are under no obligation to do so, but you'd hope that the 3 parties involved in selling would be well aware of the unsettling effect this has on existing shareholders and make an exception by offering an explanation for their selling. I'll make my judgement on whether to continue to hold based upon whether or not this happens.

[shanklin] 26/6/2018 15:25

Well its a lot less bad than the CEO selling the whole of his holding.

925,000 shares sold in all, which is a fraction under 3% of the company (2.9996% if the shares in issue are still 30,837,653 as per the latest holdings RNS). So, whoever the buyer, perhaps they want to avoid declaring their position.

[palmermpz] 26/6/2018 15:19

Sold at break even. Frustrating share and co-ordinated director selling in big quantities doesn't inspire confidence. Back on the watch list as results suggest it is a solid company...

[michaeljames1] 26/6/2018 15:11

When the CEO reduces his holding by a third that's definitely not a good sign....

[stevegrass777] 26/6/2018 14:50

Why the director sell off today I wonder.
Just profit taking?
I don't like it when two or three do it in one go.
Do you think the currency exchange business will be effected by the very hot weather and people staying home instead.

[wanttowin] 21/6/2018 13:51

just added 1500 on this dip

[topvest] 18/6/2018 20:48

Seems a nice little company here. Happy to hold.

[lammylover] 18/6/2018 17:05

Surely got to break through 200p shortly? 175k buys today, 10k sells and MMs dropped price at the end of the day. Got to still be a big seller out there or an overhang to clear in my view. Hopefully clear shortly and we will be ready to move on up (as Curtis Mayfield said!) gla holders Rich

[igoe104] 17/6/2018 09:07

IC Comment.


Ramsdens upgrades yet again
Simon Thompson
Middlesbrough-based Ramsdens (RFX:197p), a diversified and fast-growing financial services company, joined London’s junior market early last year, and has been posting a series of earnings beats ever since.
To put the upgrade cycle into perspective, when I suggested buying the shares, at 132p ('A jewel in the north', 12 Jun 2017), analyst Justin Bates at Liberum Capital predicted the company would deliver pre-tax profit of £4.8m and EPS of 12.6p in the financial year to the end of March 2018. He subsequently upgraded his estimates twice last autumn to £6.23m and 16.2p, respectively. In the event, Ramsdens increased pre-tax profit by 56 per cent to £6.31m and delivered EPS of 16.4p, up from £4m and 10.1p in the 2017 financial year.
The fivefold rise in the payout to 6.6p a share was better than I had expected and is supported by a bumper operating cash inflow of £5.5m, which boosted closing net funds by a third to £12.7m, a sum worth 41p a share. This provides the directors ample capital to finance a planned store roll-out programme of 10 new stores this year at an average cash cost of £220,000 each. A 30-month payback period for their investment highlights the high returns to be made. The cash pile also offers firepower for the directors to make small bolt-on acquisitions on the pawnbroking side of the business, with a view to cross-selling Ramsdens' full product range in the acquired businesses. It makes sense to do so in light of the success the company is enjoying.

Specific profit drivers
A key driver behind this stellar organic growth story has been the company’s highly competitive foreign currency arm, which exchanged £483m-worth of currency, up from £408m in the previous financial year, for 687,000 retail customers. Total commission rose by more than a quarter to £11.3m to account for 40 per cent of the company’s total gross profit of £28.3m, partly reflecting the 13 per cent growth in transactions but also a focus on margin pricing, with Ramsdens increasing its cut from 2.2 per cent to 2.33 per cent per transaction.
There was also a strong contribution from the company’s pawnbroking operation, which has 34,000 customers and raised its loan book by 8 per cent to £6.4m. Interest income increased at even faster rate, up 14 per cent to £7m to account for 25 per cent of Ramsdens’ gross profits, reflecting higher lending on jewellery. The company has been able to do so because it has been scaling up its jewellery retail operations by cross-selling to its 800,000 customers through the 131 store network and increasing its online presence. The jewellery retail business increased revenues by more than a third to £8m and lifted gross profits by a quarter to £4.1m.

Value on offer
Admittedly, investors are cottoning onto the ongoing growth story, which is why the company’s share price is up 46 per cent in the past year. However, there is still value on offer as net of cash on the balance sheet the shares are still only rated on nine times Liberum’s conservative looking upgraded EPS estimates of 17p for the new financial year. They also offer a prospective dividend yield of 3.6 per cent based on a payout of 7.1p a share.
So, having last advised buying the shares at 185p ahead of the full-year results (‘Riding earnings momentum, 16 April 2018), I feel a new target of 225p a share is warranted to value the equity at £69.5m and give the company an enterprise value of £56m net of cash, or seven times annual cash profits. Moreover, even if my target is achieved it still represents a ratings discount to rival H&T (HAT:351p), which is rated on eight times this year’s likely cash profits to enterprise value. I included H&T, at 289p, in my 2017 Bargain Shares Portfolio, since when the board have paid out total dividends of 15.8p, and have a 400p target based on a 2018 cash profit multiple of nine times (‘Bargain Shares: Beating the market Part II’, 14 Mar 2018).
With scope for the ratings discount to its larger rival to narrow, and the company making a good start to the new financial year, Ramsden’s shares rate a buy.

[bigbigdave] 14/6/2018 12:03

The seller who it appears we knew the identity of all along may be be done!

[cheshire man] 14/6/2018 11:58

Good to see us moving up today :-)

[pireric] 13/6/2018 20:56

Sorry not looking for red flags at all, just more obscure info/general flags

[rp19] 13/6/2018 20:51

Not really sure if that is a specific flag. It's a fact and they've highlighted it.

[pireric] 13/6/2018 20:01

Just reading the release to look for hidden flags:

"It should be noted that in FY18 the Group benefited from two pre-Easter holiday periods whereas there will not be one in FY19 due to the late Easter in 2019."

[yump] 13/6/2018 13:46

I bought a chunk here a year or so ago for the dividend and some growth as its still quite small - hopefully to forget about now they have some breadth to the business.

Difficult to know if the retail problems work for or against them or just cancel out.

Without being too non-PC, I guess their target retail market are more likely to be walking around towns than most ?

[glasshalfull] 12/6/2018 12:48

yump - that made me chuckle!

Cheers
GHF

[glasshalfull] 12/6/2018 12:47

Afternoon guys,

Quite correct Puffet, I’ve sold 50% of my holding at c.200p for a 74% gain. It was my largest holding by a distance & simply prudent portfolio management. I plan to hold the remainder...so any further selling ain’t me.

I was happy with the results & outlook & believe Liberum’s 17.0p earnings target will prove conservative. That said, I’m also mindful that RFX are up against strong comparators in FX & the well publicised implosion of the High Street could also impact...both favourable & negatively.

Favourably... as units/stores available for a fraction of the costs. Negatively...but perhaps lower footfall in branches???

So, overall still positive. V well managed company.

All IMHO

Kind regards
GHF

[yump] 12/6/2018 12:21

Yes Glasshalfull - well known for buying one month and selling a couple later.
Not.

What we need is simply time. If its growing earnings steadily, the share price will most likely rise steadily. Gamblers best look elsewhere imo.