Ramsdens Share Discussion Threads

[pillion] 21/6/2019 12:08

Good find Rivaldo

[rivaldo] 20/6/2019 13:27

Ta henryatkin, interesting comparison.

Gold is up above $1380 now. Good news for RFX.

[ntv] 18/6/2019 15:10

what over lap in stores is there?
Ramsden a bit short of stores down south
plenty of room for organic growth
gold wants to break free

[henryatkin] 18/6/2019 11:41

Sharescope: Ramsden v H&T bottome couple of pages.

A few extracts: The main difference between the stores is that Ramsden have a much higher proportion of foreign currency exchange carried out in store while H&T has an unsecured loan product. The foreign exchange is offered at better spreads than most of the large banks offer it and it has long been an unspoken truth that banks make outsized profits from customers from wide foreign exchange pricing. So, Ramsden has found it can provide a competitive product to its customers which is highly profitable......

..... as both companies have a significant stock of gold in their inventory any increase in the gold price will increase their profits which I am rather liking. These are defensive stocks to own.

The markets obsession with growth over the last 12 months has led both stocks to depreciate and both now trade on a similar PE ratio of 10.3/10.4X and give a 3.5%-4% yield. However, at Ramsden the ROE is almost double that of H&T implying a much more efficient allocation of capital.

We can see from this table that H&T, with 182 stores has a higher revenue/store (£786k) but with a lower profit contribution per store of under 10% as it has less of the high margin foreign exchange business. Ramsdens 156 stores have a lower turnover per store (£300k) but a higher margin of 12.6%. The cash generated from this extra margin may be the reason that Ramsden is in a net cash position while H&T has a modest amount of gearing.

[ntv] 17/6/2019 22:15

last of the overhang gone today?

[rivaldo] 14/6/2019 13:50

Cheers - here's a link:

[wynmck] 14/6/2019 12:44

ST updates in IC...."stellar performance" BUY @177p

[rawnsley] 13/6/2019 17:50

Looking at the report it looks set for a bumper 19 with 10%+ profit growth due to FX growth increasing and money shop store improved revenue and profits, along with reduced costs from this as investment was partly prior year.

I would like to see more LFL sales, as while they say stores are profitable, are they on average reducing in profit, but managing to stay above breakeven? Clearly not at the moment, but the trend would be interesting.

[yump] 12/6/2019 12:36

RFX is indeed exposed to the economy. Different parts of it, which prosper or not at different times, so I don't understand why that is an issue at all. To me it looks like a balanced business. If it were all FX or all gold or all jewellery it would be a risky exposure. As it is, its retail-related, but just because it has consumers as customers, doesn't put it in the same camp as other stocks whose market does depend entirely on the economic cycle.

[tp6] 12/6/2019 12:33

Nearly half a billion in Foreign exchange transactions. Scope to build that up further as banks and travel agents close branches.Pleasant experience if you pop into one of their shops. Staff are very on the ball.

[ntv] 12/6/2019 11:23

A good yield that looks pretty safe
not overly rated
gold price starting to inch up
happy to hold maybe add on weakness

[essentialinvestor] 12/6/2019 08:33

Looks rather tasty to me, nice specialist niche segment.

[topvest] 12/6/2019 08:29

Results are solid versus more difficult comparatives. Happy to hold.

[saurish] 12/6/2019 08:26

Great result imho. Management have done an outstanding job holding their own in adverse conditions and producing YOY improvement while maintaing a strong balance sheet.

[rivaldo] 12/6/2019 08:20

Liberum reiterate their 248p target.

The current year forecast is for 19p EPS, rising to 21.3p EPS next year.

The cash pile is forecast to be £9.6m at the end of this year.

Even a P/E of 10 would see around 200p, but with the cash pile, growth potential from the Money Shop acquisition, a likely better year from fx, the rising gold price, plus solid overall prospects - and defensive qualities in a downturn - imo RFX deserve a slightly higher rating than that.

Which would justify the 248p target price.

[rcturner2] 12/6/2019 08:07

Different views make a market. I have held these in the past. As I say they don't look cheap to me, they look fairly valued.

[spooky] 12/6/2019 08:05

RCT they are definitely cheap, obviously cheap doesn't definitely mean the shares are going up but .....

[igoe104] 12/6/2019 08:02

25% of the market cap in cash, plus loads of cheap acquisitions recently. plus last year was a record year for weather, so a big drop in holidays. Weather this year, back to normal.


So going forward turner, how can you say these don't look cheap ?

[rcturner2] 12/6/2019 07:56

It's a solid company but I don't think it is cheap. PE 10 is about right for a retail business that is exposed to the economy in the way it is. They have to retain a significant portion of the earnings to pretty much stand still, which is not a great sign.

[igoe104] 12/6/2019 07:41

RFX looking extremely cheap, £13.4 million cash, Divi increasing by 9%.

[gorse] 12/6/2019 07:36

Very strong balance sheet.

[igoe104] 12/6/2019 07:29

·
FX up even with a Hot summer, folks paranoid for nothing and with a average summer,2019 plus all those Money shop acquisitions, it looks good for year end march 2020.




The proposed final dividend of 4.8p, if approved, will take the full year dividend to 7.2p (FY18: 6.6p) and an increase of 9%
· Net assets up £3.3m to £30.9m, including cash of £13.4m
· As a consequence of adopting IFRS9 and IFRS15, both Revenue and Cost of sales have increased by £3.0m in FY19, with comparatives not restated. Excluding this, Revenue grew by 10%.

Operational highlights:
· Continued growth across all business segments with the Group serving more than 832,000 customers during the year
· £496m of currency was exchanged with the Group in the year (FY18: £485m)
· Jewellery Retail revenue grew by 23% to £9.8m (FY18: £8.0m)
· Store estate at the year-end increased by 25 to 156 stores including 4 franchised stores (FY18: 131 stores including 4 franchised)
· Acquisition of 18 stores and five loan books from The Money Shop completed towards the end of the financial year. Post the year end, the Group completed the acquisition of an additional four stores trading as The Money Shop and 12 loan books

[stevegrass777] 11/6/2019 10:45

its not all about FX,if the gold price keeps going up it will at the very least lift net asset prices of all the pawned gold,and pawn brokers tend to do well in a high gold price environment.
The biggest threat to FX is revolut and the likes.