RSM Tenon Share Discussion Threads

[gorvachof] 23/2/2011 07:41

That was to be expected I'd say.

Net debt of £73.3m at 31 December 2010, expected to reduce in H2 -
This was set out in Q1.
"Operating cash performance is exhibiting the normal seasonal pattern experienced in previous years, carefully maintained by consistent working capital management procedures. Together with integration costs, this will result in the expected peak in net debt in the first half, reducing in the second half"

Re: Spending Review
Early warning signs first given at AGM imo.
"Whilst the full impact of these changes has not yet been experienced"

Any drop in the Share price though could just be the creation of a better entry price for long term growth. imo.

[luthier] 23/2/2011 07:21

Dose that not need to be seen in the overall context?
What about this:
"Profits for the year ending 30 June 2011 are currently expected to show corresponding gains, increasing operating margins on the previous year and representing strong growth in earnings per share."

[simon gordon] 23/2/2011 07:07

Profit warning:

"The first six months of the year has seen significant changes to key financial legislation and economic indicators in almost all areas of our business. The Comprehensive Spending Review, Draft Finance Bill, insolvency statistics and inflation all have relevance to the future shape of our markets, impacting on the UK economy and increasing uncertainty for many businesses.

These external features that have influenced our marketplace in 2010 are expected to continue throughout 2011. This results in a more uncertain trading environment and whilst we fully expect underlying profitability to continue to progress, we consider that it will be at a slower pace than originally anticipated."

[gorvachof] 22/2/2011 12:31

Interims out tomorrow people.

[envirovision] 17/2/2011 15:09

eps is projected to be 8.2p this year then for 2012 9.2p and 10.6p for 2013, also the stock is on a PEG of 0.3 this seems to highlight the forward growth via cost synergies.

Bonnio1000 As you may be right just stable for a couple of years before general growth I am not disputing your outlook, but what if you are right? ... then that implies continued growth into 2014 and beyond. ie could be looking forward to economic growth taking the reins by which time the projected dividend yeild will also start to become an attraction.

On a present forward PE of 5, its undervalued and should be bought. IMO. Its just a matter of buying and holding to double ones value here in time imo. I agree dont expect fireworks and for it to happen like an oil stock, but given time it will imo.

Just looking for ICs tip you keep going on about, they are highlighting cost synergies through acquisition of RSM Bentley Jennison.

This is what they said:
#
#
Profits are expected to rise significantly as cost synergies start to show through, and the business climate suggests that demand for accountancy and recovery work is set to continue growing. Trading on 6 times forecast EPS at 56p, the shares retain their attraction. Buy.

[bonio10000] 17/2/2011 14:50

Accountancy practices are being squeezed (I work in a top 25 one).

I see no reason to pile in as fees are stable but under pressure. It's not as if they can suddenly find oil. This will only move with an improvement in the economy, which could take a couple of years to feed through into fee income.

Haven't read the IC article, but sounds like BS if they are ramping this.

[jimelson] 16/2/2011 22:23

Best to create your own tips imo. Jurys still out here, chart gives me a head ache

[farmsted] 16/2/2011 13:08

Its seems that the news the Investors Cronicle gave was either premiture or a hype as the shares have only gone one way since there tip, Am I missing something having bought on the IC tip or will I have to wait years to get my money back.

[jimelson] 09/2/2011 15:39

Personally Martin, I had thoughts on buying at first over 60p with stop 58p, and then 57p with stop at 53... If I had brought, both times I would have been stopped out. Like you say Martin better to take a "small loss" and be safe.

I personally not liking the look of this chart now. Still with the right news it should rocket.

[martin2729] 09/2/2011 12:36

broke support 55. its so hard, how long do you keep holding. that is always the big question.
can't always get it right small losses

[farnesbarnes] 09/2/2011 12:22

Surely 52ish would be a better cut considering the mid December hammer?

[martin2729] 09/2/2011 12:17

Decided to cut had enough

[envirovision] 09/2/2011 11:22

well put it this way if it does then it will be on a forward pe under 5

[pugugly] 09/2/2011 10:50

Chartwise now starting to look as though 55p resistance may be about to break. If 55p goes next small resistance could be at about 49/51 and then nothing until 45/46.

Apart from changes in work load as a result of changes in legislation and the economy I suspect the success [or lack of it] in the integration of the Vantis acquisitions will be the short term driver of the share price

Any other thoughts ?

[jimelson] 02/2/2011 08:54

AGM
""During the period since our last reported financial statements, a number of significant changes to key financial legislation have emerged, combined with continuing developments in the broader UK economy. The Comprehensive Spending Review, insolvency statistics and the Draft Finance Bill all have relevance to the shape of our business for the future.

"Whilst the full impact of these changes has not yet been experienced, we remain confident in our balanced portfolio of service lines and in our ability to provide client solutions according to changing demand. Trading has remained in line with market expectations for the full year as stated in the Q1 Interim Management Statement announced on 10 November 2010.""

The beginning of the second paragraph is what has stopped me buying so far. I was looking at Eaga just before they were hit badly by Goverment Cuts.
I have been trying to work out as to what and how these changes may make affect but not having much luck.

[janes bond] 02/2/2011 01:31

RE: The dividend - 1.6p doesn't come across as hugely impressive. However, considering that this is a Small Cap company, at the current share price, the yield is 2.69% and has potential to grow. To me that would be a deal breaker, but only if there was some reassurance of value at this share price. By value, I mean for the shares to continue rising. This would present a double whammy of growth and income. It's the potential growth, (or more to the point, the possible lack of it), which almost strikes a line through the idea for me. 2.69% annual return is more than most banks are shelling out for your hard earned spondoolicks. The most juicy part about the dividend is its year on year growth which, if maintained, is both A GOOD INDICATOR OF A COMPANIES FINANCIAL HEALTH and great for overcoming the effects of inflation. A lesser benefit, of course, is help with paying for transaction costs and a cussion in the event of corrections and share price fluctuations. Admitted, holdings in RDSB, Chesnara and Vodafone, to name a few, are the real income providers for my portfolio, but I don't look on those holdings for growth.
I wouldn't, for one minute, try to fool myself that the market has overlooked this one. Financial advisors and accountants rely on a healthy economy - i.e. for their own clients to be doing well in order to continue to use, or more to the point, increase demand for the services. If Begbies statement is anything to go by, then I wouldn't be surprised to see signs of a struggling RSM Tenon at this time. The macro economic news is plagued with stories of 'austerity measures', (cutting government funds for services to the bone), as well as potential company failures etc... Meanwhile, I hope for holders, that my long established cynical views towards most companies is proved total twaddle in this case, but it has saved me from losing cash on many occassion. I wonder what the thoughts of Peter Lynch, Warren Buffet, Jim Slater etc. would be?

petersinthemarket - 30 Jan'11 - 12:22 - 186 of 186
All in all, I would also be interested in buying into TNO, but for now, I have a very small spread bet for the run up to results, (complete with tight stop loss and to be cancelled before results). I would rather see more evidence from the company on news day before risking cash which could be used with more confidence elewhere. If this boat is missed, there's always another on its way.

[envirovision] 28/1/2011 10:01

Infact looking at events the last few days in more detail, it appears the price did bounce off 57p so yes i guess we have to see support from this level. Significant since if you look at the last 4 years starting from the peak its been in a 4 year down trend from 70p, i drew the average of the top of the trend at 56-57p

We are now above the top of this upper trend line, since we bounced off it. I have bought in.

Sorry i cant show you graph i am using sharescope, it grades it highly for value/growth using my filters.

[envirovision] 28/1/2011 09:37

There may be some support at 56p. I think if 56-7p then becomes long term support then you could be seeing a long term change.

As you point out its been stuck in a tren for 4 years, so any change is not going to happen over night.

However i can understand why david linton got excited.

I have just read the last several posts and would comment about the dividend. Its only 1.6 pence or so. So its such a low dividend, hardly of any relevance at all imo.

[petersinthemarket] 27/1/2011 14:54

Congrats on the wide choice of charts on the header.
They demonstrate superbly how difficult it is for charts to accurately reflect a shares chances of rising. Each chart could be interpeted in a different way. For my money (no pun intended) the 10yr chart is the most revealing. The share price has been stuck in a 40 to 60p trading range now for over 3years. As nothing stays the same for ever, the share price simply has to make up its mind at some time or another whether to rise or fall to escape the current support/resistance tunnel. Any sustained break above 60p would have to be treated as highly significant. Assuming we continue to get good management, plus the usual luck, I believe the break will be upwards - but when is still another matter.
pim

[keybox] 27/1/2011 08:33

Yes, that does clarify your post and of course you are absolutely right to suggest moving in on a dip. Very difficult to time correctly though.

[janes bond] 26/1/2011 15:02

Sorry keybox - I was trying to add substance to your post regarding profit taking, which forms the main aim of my post. Perhaps a misunderstanding. You are right regarding the dividend provides a decent yield and year on year growth, which is why I suggested maybe a hold, as opposed to a buy. That is also why I watch for a decent entry for the longer term. Holders will have a distinct difference of opinion to speculative buyers looking to start accumulating.

After re-reading my post, I think I realise the cause for confusion. To try to explain my reference to the dividend; it was an attempt to explain that investors looking for an entry to the shares, for a decent yield, (pension/fund managers, along with private investors), would see that existing holders, (like yourself), have already been paid the last years income, therefore presenting considerable time to accumulate before the next payout.

So, if you tried to view the shares from a buyers, (as opposed to a holders), point of view, you would also, surely, wish to gain entry at as low a point as possible. Also, a buy signal may present itself as a good opportunity for you holders to accumulate/add, as I'm sure you would prefer to maximise profits as much as is possible - hence preferring a lower share price bouncing from a moving average or some other support on the chart?

I hope that helps.

[keybox] 26/1/2011 07:20

James Bond. When you say "no dividend for almost a year" are you referring to Begbies because that does not apply to Tenons, they have inceased their divi year on year. I have just received a healthy return on my investment. I am a long term holder as this is a growth company and look forward to the H1 results due at the end of Feb.

[janes bond] 25/1/2011 23:09

keybox - 25 Jan'11 - 15:01 - 177 of 178
I think that could be one of many reasons for profit taking
However, other reasons might include poor GDP figures, Begbies announcing a high rate of company insolvencies for 2011, a large amount of debt, no dividend for almost a year and all coupled with soon to be announced results...

I'm still interested in the shares and the tip on another financial website, as posted by davebowler - 21 Jan'11 - 13:06 - 176 of 178 caught my eye. I assume David Linton is concerned with TA, as opposed to fundamental issues, otherwise the shares might have been rated a 'hold'?

If the company announces that debts are being reduced and the share price looks good value, I will consider buying for the longer term.

You'd think a firm of mostly accountants and financial advisors would keep their own business healthy?

[farmsted] 25/1/2011 15:07

is it still a buy or will it dive futher ??