Rpc Share Discussion Threads

[beckers2008] 08/9/2018 14:57

steverabet,

Pretty much everything went badly South in June 2016 so your point has no weight? What are you talking about? I'm talking about the Shorts increasing from October 17!

Hold on, I'll put my rose tinted specs on and not worry about market gyrations!
From the morningstar website, RPC have under-performed the FTSE 100 over the last 3 years, surely 3 years is not short term.

More media bad news for RPC today from the BBC today, the Atlantic ocean is being cleaned up of plastics and the organisation behind it estimated that half the Atlantic will take up to 5 years to clean and this is only the surface down approx' 50 metres.

I do like RPC as a company but I think there are too many headwinds facing it currently and they are not going to go away anytime soon, certainly not for another few years.

[steverabet] 08/9/2018 13:16

jeffian you appear to be conflating shorts which are trades with cfd's which are not (and thus cfd's have absolutely no impact on SP) on other points i tend to agree - plastic is actually essential (awkward to dispose of, admittedly) and i see value and potential in RPC
beckers - don't really care. rpc went from £4 in 2014 to £10 in 2017 - not too shabby. and all the while eps has gone from 38p to 72p. pretty much everything went badly south in june 2016 so your point has no weight. market gyrations happen. you might not like rpc, you might have real and valid concerns, but fixating on short term share price declines as overall indicators of a company's worth is short-sighted

[jeffian] 07/9/2018 11:41

"jeffian, thats not correct. no shares change hands in cfd or spreadbets -"

I didn't say they did, did I? The point I was making was that under the old regime, the trade was for a fixed period after which the seller had to produce the shares to the buyer. With cfd/spreadbets the position can be left open for long periods.

[beckers2008] 07/9/2018 11:31

steverabet,

RPC is down over 21% in a year, this is a 'dog' performance.

Northern Trust has concerns and this is spreading into market, notably the short position has steadily increased from 0% in October 17 to 9.27% recently on the 4th September.

You do not have to be on your toes lending from LTH's using AT and Autobot trading along with 10 other fund managers, it's the way of the trading world I'm afraid.

[steverabet] 07/9/2018 10:47

jeffian, thats not correct. no shares change hands in cfd or spreadbets - it's essentially on online bookie. and whilst it is true that the action of shorting itself does temporarily depress a share price, keeping a short open until you are in the money will cost - you must pay any dividends to the owner of the shares, plus roughly 3% borrowing fee, so you need to be pretty sure of your guess or have a high risk appetite.
it boils down in the end to timing and fundamentals - if you short a dog (carillion) you win, if you short a decent company, you lose - unless you are really on your toes

[jeffian] 06/9/2018 19:25

DR_SMITH,

Whilst I have nothing against short-selling per se (not that I do it myself), I do agree with you that modern 'instruments' such as CFD's and spreadbets have changed the dynamic, particularly the ability to leave the trade open for long periods. Being an old codger, I remember certificated trading and in those days you were contractually obliged to deliver the shares at the end of the agreed trading period - T10, T20 whatever - and it seems inherently wrong to me that you can build a short position (the existence of which will itself exert downward pressure) and simply leave it open until you 'win'. To make an analogy with sports betting, it seems to me the equivalent of betting your team will win a football match and when they have lost after 90 minutes you simply say "Well play on until my team gets ahead, however long it takes!"

Shorters need a story to hang their hat on. In this case (RPC) there is no doubt in my mind that the Northern Trust shenanigans were an orchestrated attack of the type derided above, but then along came Saint David Attenborough and they are suddenly fighting a PR battle on two fronts, financial and 'politicial'. Ultimately, the only way a company can defeat the shorters is to perform and prove them wrong. I have a significant holding in RPC and I believe that the financial fundamentals are sound and that the 'green' issues will be dealt with and fade over time, so I will continue to hold and find Beckers' persistent droning on this point rather tiresome. The point is made; there's no need to repeat it several times a day to the exclusion of all else.

[beckers2008] 06/9/2018 19:00

Yet another increase in the short position.

Portsea Asset Management LLP notified the market on the 4th September that they have increased their position to 0.92% of the stock.

Total Short position, currently 9.27% of the stock.

[beckers2008] 06/9/2018 18:48

DR_SMITH,

Totally agree.

There is so much & many underhanded stock market activities, it's scary and the big boys are all in it together, surely anyone that has been around a while knows this, especially in the tech/trading world as one method I mention "rinse and repeat"

For many years, my rose tinted specs removed permanently for all stocks I own or would like to own!!!

[dr_smith] 06/9/2018 18:21

I beg to differ on short selling.
Bear selling was typically within a 3 day (T+3) or 5 day period and purely a short term view, with no action on behalf of the bear to influence the market, other than the sale itself.
Short sellers are there for a longer period and in this period use various tools, mainly media to my knowledge to foster negative views by other to make the financial speculation come true, not by normal commerce but the creation of negative sentiment through any means.
The distribution of news without declaring the writers connection (directly or directly) with sh*rters is nefarious activity.
Unfortunately legal, but still nefarious (criminality is case dependant but typically wicked).

The internet with its long reach in a short time (less than 3-5 days) means negative news spreading is now easy and ever more prevalent, leading to false news we have now as a hot topic.
It's what I call, being a sh*t and you get out of life, what you put in it.

When you approach death and reflect on your lifes influence on this rock, do you really want to say you undermined good commerce in your country?
Blinkered thinking can be used to help sh*rters sleep at night.
IMO.

[steverabet] 06/9/2018 17:50

beckers, institutions lend out LTH's stock because they have a long term view. if you can bag a 5% dividend plus a 3% lending fee whilst waiting to hit your price target (mine is a year or 2 away) it's basically free money. there's nothing nefarious in it. and 'shorting' is not 'market manipulation' - it's what was once called 'bear selling' in old money

[beckers2008] 06/9/2018 17:26

S,

For me, I don't like LTH's adding to their position, only to lend out to shorter's to manipulate the share price
If GS are happy to get the interest payment so be it for the period they are prepared to lend so be it. Unless the share price goes South big-time, GS can't lose, easy money for them!

RNS - GS just reduced their LTH and reduced their open lending position to 1.18%.

Oops! and Oops! again, so now we know 0.37% have been lent out for the shorters to 'rinse and repeat' Guess that's why the share price is now sub 7.00.

[squidsgone] 06/9/2018 15:15

What's the 'oops'?, doesn't that just mean they are happy to own the shares but just get an interest payment whilst on loan? The borrower may use them to short. Point is that GS are happy to own and not short themselves.

[beckers2008] 06/9/2018 14:55

B,

And increased their open lending position to 1.55% up from 1.29%!
Oops!

[bouleversee] 05/9/2018 18:27

Well, Goldman Sachs apparently thinks they are worth adding to. (RNS today)

[beckers2008] 05/9/2018 18:09

Cashcow5,

I surprised you haven't heard of the Fool Tip Curse, the good old IC had a bad name for this about a decade ago, the Fool as far as I know haven't shrugged theirs off yet. Good Luck.

[cashcow5] 05/9/2018 17:28

well obviously their knowledge is nothing like yours Beckers, but I've still done quite nicely with some of their tips so I'm happy to continue to take note of their views ;)

[beckers2008] 05/9/2018 16:56

They don't call them Fools for nothing, they certainly are, any Fool tip is one to be avoided at all costs, the proof could be in the text;

"Although concerns over the way the company funds acquisitions has weighed on its share price more recently"
What is this fool talking about?
The last major US purchase 'Letica' via a placing that was taken up by the tune of 97%. Where is the concern...Fool?

The problem is currently the company can not fund any acquisitions because of the current market valuation making it too expensive to do so, so the growth has slowed materially.

The latest broker forecasts have resulted in a reduction of sales, profit, eps and dps. Eps 5% this year down from an estimated 7% a couple of weeks ago.

[cashcow5] 05/9/2018 16:12

From Motley Fool (4/9/18)

"Plastic fantastic
Now Assura doesn’t come cheap, the firm sporting a forward P/E ratio of 19.7 times, which sits outside the widely-regarded value territory of 15 times and below. Whilst I reckon its leading position in this particular defensive medical market warrants a ‘lively’ premium, investors on the hunt for classic value may be more interested by RPC Group (LSE: RPC) which carries a prospective earnings multiple of 9.2 times.

Although concerns over the way the company funds acquisitions has weighed on its share price more recently, I believe that these fears are now baked into the plastics packager’s rock bottom valuation. The FTSE 250 play has pruned its operations and divested non-essential divisions to boost its balance sheet to help it continue on its M&A-led growth path in recent times too.

Moreover, whilst fears over plastics regulations from the EU have also put a dampener on investor appetite in 2018, RPC’s drive to develop its products with customers in line with modern environmental concerns should still provide the scope for it to keep winning plenty of business.

Dividends have risen for 25 consecutive years over at RPC, culminating in a reward of 28p per share for the year ended March 2018. It’s no surprise that expectations of further profit growth (of 5% this year and 7% next year) lead the City to anticipate extra significant payout growth as well.

A 30.2p reward is anticipated for the current fiscal year, meaning a chunky yield of 4.3%. And in fiscal 2020 the dial moves to 4.7% thanks to the predicted 32.5p dividend. RPC remains a stock to buy today and hold for years, in my opinion."

[jeffian] 03/9/2018 22:28

This is all a bit esoteric, isn't it, Beckers? I'm not sure anyone gets your point, or cares much if they do.

[beckers2008] 03/9/2018 18:58

RPCtech66,

Of course they apply, an acquisition is an acquisition.
Why fanfare your acquisition policy and then not demonstrate you are abiding by it?

[phillis] 03/9/2018 15:44

Correct RPC
Common sense is not in great abundance on this thread

[rpctech66] 03/9/2018 14:37

Plasgran are a recycler of plastic waste and not a producer of plastic products. So the same metrics don't really apply in this situation.RPC pay to have material recycled and also buy recovered material from Plasgran.This was more of a " look at what were doing" publicity more than anything else in my opinion.

[beckers2008] 03/9/2018 12:22

Steverabet,

RPC must have some idea when buying another 'Plastics' company if it is worthwhile or not.

RPC sold their acquisition strategy to the market with the trumpeted 20/20 vision project and this came with strict criteria.
This appears not to be followed otherwise RPC would have stated that their metrics have been met and/or their statement “All RPC's strict acquisition criteria are expected to be met”.

The market likes consistency and this has not been demonstrated in this instance.

Given this year's poor share price performance, I would have thought the BOD would have been a bit more careful.

[steverabet] 01/9/2018 12:31

i assume that the RPC board don't have a crystal ball to predict just how earning accretive plasgran will be; it is not usual for a company to publish all of their data comprising all of their analysis. second guessing the management is not a game that i play - let them get on with it, they will get judged by results - which, whilst leaving room for improvement, are far from shoddy.
my 'job' - or more succinctly, 'financial self-interest' is to keep myself apprised of salient facts. for now, i see value in RPC so thats why i hold

[beckers2008] 31/8/2018 14:15

steverabet,

You don’t need to scrabble around for too long to find reported inconsistencies and the market lamp is certainly illuminating on the operation performance of RPC.
From the last RNS, It seems the management are inconsistent on their reporting of acquisitions, will the market lamp start shining on this?

RPC statement;
“On 13th August RPC acquired PLASgran Limited, for a cash free, debt free consideration of £34.5 million. Operating from facilities in Cambridgeshire, PLASgran is a leading UK recycler of rigid plastics and in the last financial year generated revenue of £27 million”

RPC don’t mention their metrics of their acquisition policy with this purchase such as;

EBITDA and/or pre-synergy EBITDA multiple of circa %?
ROCE or RONOA %?

Is “the acquisition expected to be earnings accretive from year 1 with ROCE in excess of WACC, whilst RONOA and return of sales levels are expected to be comfortably ahead of the minimum hurdle levels of 20% and 8% respectively” ?

Or the statement - “All RPC's strict acquisition criteria are expected to be met”.

Why the inconsistencies, have RPC instilled confidence that they haven’t overpaid for another ‘Plastic’;s’ company?