S & U Share Discussion Threads

[the big fella] 15/1/2008 16:02

PE 7 and yielding over 8%. Cash generate business in a niche sector which could be a beneficiary of the current credit crisis. They do look very cheap.

[the big fella] 15/1/2008 16:00

" In marked contrast to the gyrations of the stock-market, both generally in our sector, and in S&U's share price, our trading remains stable and resilient and we view current trading with confidence."

Just what the company said in December. I bought some more this afternoon.

[chrismcglone] 15/1/2008 15:52

As we keep saying for anyone who cares to listen BIG FELLA, this is gravy train time for these companies. It will just be a while before it is noticed.

It reminds me of the Lloyd's syndicates i often invest in. The very best time to jump in is when they are getting hammered after a really bad hurricane or major category claim season. It certainly doesn't seem like it at the time but the following 18 months always see great profits.

It's a small specialist market and no-one is paying a blind bit of attention to it at the moment - other than to run scared as it looks (on the surface) like all the other financials getting hammered.

[the big fella] 15/1/2008 15:42

Interesting announcement today from Private and Commercial Finance (PCF) - who have some similar business interests. It appears business is booming.

[chrismcglone] 10/1/2008 21:09

Welcome on board BIG FELLA. 8% is just too bloody good isn't it and what a price to get in.

philjeans, looks like it could take a good few months for the market to realise that this is exactly the kind of economic climate we could thrive in as you rightly point out.

However, i wasn't intending going anywhere anyway. I am holding this for a wee bit of diversification and the pretty much guaranteed income so not really bothered.

Sooner or later the natural forces will correct the overdone fall.

[the big fella] 10/1/2008 14:21

Looks like all the deals recently are going through PLUS. All buys over the last couple of days , albeit in small amounts.

[the big fella] 10/1/2008 13:27

That was my thinking anyway. Bought a few this am and will look to add depending on how things pan out.

[philjeans] 10/1/2008 13:05

Fella; SUS has been mauled by a few small sellers, in the wake of the London Scottish fiasco where a new CEO has brushed very clean with his new broom. Plus, LSB have been caught under the BASEL 11 legislation which calls for increased capital reserves for small banks.

The board have assured me this is NOT the case with SUS, which has adequate funding and capital and are not actually a bank.

In a very severe macro credit downturn like this, and indeed, generally poor economic times, small credit suppliers like SUS, do extremely well.

Excellent value currently.

[the big fella] 10/1/2008 12:14

I would have thought some value / income funds would be taking a look at these levels.

[the big fella] 10/1/2008 12:06

OK - dipped my little toe in and if they fall further will add a few more.

[the big fella] 10/1/2008 12:04

I haven't looked at these for a while. Looks like they have suffered along with other small caps. PE of 7 and yielding over 8%. Recent trading update provides comfort the business is performing well and appears to be resilient compared to other sectors.
These look too cheap - but markets have a tendancy to go to extremes so I suppose they may go cheaper still. However looking at the chart anything under £4 historically has prooved a bargain.

[chrismcglone] 09/1/2008 19:27

Guilty by association philjeans.

Even though the link is very slim indeed.

Opportunity knocks as they say and fortune favours the brave.

More than enough cliches for one day however. I am still well and truly in.

[philjeans] 09/1/2008 09:08

I have been assured personally that SUS has no BASEL 11 problems.

London Scottish are a complete mess with bad debt write offs AND capital inadaquacies - a new broom is sweeping very clean it seems.

No such horrors here.

[chrismcglone] 08/1/2008 21:48

To answer my own question, i make it 8.16% at share price of £3.80 with a full year divie of 31p.

After having looked at this logically, i am seriously thinking of buying tomorrow. If the share price goes nowhere for 5 years you make 40%. A lot more with divies re-invested.

I think it was Jim Rogers (maybe's Warren B) who said about the market that every now and then there is a pile of money just sitting in the corner that nobody else seems to want. That's when he just wanders over and picks it up.

I say no more. Goodnight.

[chrismcglone] 08/1/2008 21:32

Hard to believe the level of fall given almost no shares traded in past month.

What the hell is the divie at this price. 8%?

Typical scattergun action in the markets just now. This is not the time to have market stops in place.

[philjeans] 08/1/2008 15:48

No probs here; nervous nellies selling in a panic.

The board have confirmed they are not caught by the Basel 11 legislation - London Scottish were registered as a bank and therefore subject to capital requirements - SUS is not.

Good time to top up - fantastic yield, ISA ble and recent trading statement has confirmed all is going very well.

MMs mugging any distressed sellers.

[pugugly] 08/1/2008 15:41

380p offer now - No volume - continues to fall - no apparent news - looks like someone knows something bad - Basle II ?: or a big dump?

Any knowledge, thoughts?

[ydderf] 02/1/2008 08:39

the fsa are weak and cowardly, and thus will always pursue the easy companies instead of standing up to the real culprits like NRK, (and probably most of the major banks) - prepare for more of the same against other easy targets, maybe including sus....

[philjeans] 01/1/2008 12:04

Fair enough - I tend to agree. Why don't you ring the F/D tomorrow to set our minds at rest - they are normally happy to speak with shareholders.

[pugugly] 01/1/2008 10:27

philjeans:> I agree in principle but it seems that London Scottish fell down on the new Basel II requirements - from today's telegraph - "under Basel II rules more capital must be set aside for riskier assets as LS lends to those on lower incomes and has a relatively high impairment ratio it is required to hold more capital than under the previous regime" The same market and type of customer serviced by S&U

I have just checked both the half year accounts and the recent trading statement and can find no reference to Basel II. I can find no reference. As it would appear to me that the regulations would apply to the company I would have expected some mention along the lines that the "company meets all the requirements" This omission concerns me.

(The above is a search for reassurance no ramping or deramping intended)

[philjeans] 31/12/2007 09:54

Pug; I can't believe Coombs wouldn't have made some reference to any capital shortfall position, when he made a fairly full and comprehensive trading statement earlier this month, if such was apparent.

I think London Scottish have been found wanting - not just on capital inadacuacy but obviously on bad debts as well!

Happy to hold here.

[pugugly] 31/12/2007 09:22

From London & Sccottish rns today down 20% to 60p - Implications (query any one know for S&U.

"The interim ICG will result in the Company being required to hold significantly more regulatory capital than under the Basel I regime. The combination of the Company being required to hold additional regulatory capital together with the impact of the additional impairment provisions, referred to above, will result in a shortfall of regulatory capital as at 1 January 2008 of approximately £13m.

The directors consider that the Company continues to have a strong balance
sheet, enhanced by the disposal of its leasing business and head office freehold premises during the last 9 months. Furthermore, the Company continues to comply with all the covenants in its banking agreements. The Company will submit, to the FSA, the necessary capital adequacy assessment, during the forthcoming months, so that the FSA can set a formal ICG. The Company will commence discussions with the FSA this week about actions the Company plans to take to address the shortfall in regulatory capital. However, until the Company has remedied the shortfall of regulatory capital, it may have to restrict new lending volumes and may be unable to pay a final dividend in respect of the year ended 31 October 2007."

[chrismcglone] 18/12/2007 12:03

Yep, there was also an article in the weekend FT along the same lines.

I think 2008 could be a good year for the small lenders off the back of credit tightening by the big boys.

[jeffian] 18/12/2007 11:44

This from today's Independent. Could be good for SUS too?

"Provident gaining from credit crunch
By Sean Farrell, Financial Editor
Published: 18 December 2007

Provident Financial, Britain's biggest doorstep lender, said yesterday that it.......was gaining business as the credit crunch forced mainstream banks to tighten their lending.

......

Mr Crook said Provident was already gaining customers as banks tightened lending standards. Vanquis, its online credit card business, has seen a sharp increase in applications and home credit customers are growing more quickly than in the first half.

High street banks that moved into riskier lending during the credit boom are reining in their lending after the the sub-prime crisis blew up."

[chrismcglone] 14/12/2007 22:48

It certainly gets less attractive the higher the interest rate goes. Rates look as if they are headed down though at least for a while.

There are, as you say, more and more candidates to choose from and i have just jumped into RBS for this reason. Plus i am hoping for a decent capital gain on top.

I have 5% in S&U for a bit of diversification and for the time being it presents a predictable, transparent investment that i am happy to hold.

It makes sense though to keep things under regular revue. If i was going to sell though i would wait for a bounce as i am sure you could exit at a higher price than today over the coming 6 months or so.