S & U Share Discussion Threads

[pugugly] 07/2/2020 11:16

Very tightly held - Moves very fast (either way) on minimal volume - One for putting under the mattress and sleep comfortably.

[plasybryn] 07/2/2020 10:44

Overdue. Doesn't need much to get us going. Very nice.

[rogash] 07/2/2020 10:33

also trading update about this time last year.

[flagon] 07/2/2020 09:56

Thanks bench2 ... looked like it had been tipped but didn't know where. Holding in my income portfolio.

[bench2] 07/2/2020 09:43

Up 6% today full page BUY in the Chronic Investor

[chrismcglone] 31/12/2019 14:05

Steady as she goes!

[contrarian joe] 16/12/2019 17:05

Added to the income portfolio today.

[breezer_42] 10/12/2019 11:26

Copied from the note: Guidance re-iterated
S&U this morning released a trading update in which they re-iterated guidance in the face of weaker consumer sentiment and economic activity. Full year results mainly depend on collections in the next two months, but management is confident that the 20-year uninterrupted run of growth in profits at Advantage Motor Finance will continue.


Advantage (Motor) Finance
Advantage Finance provides Hire Purchase Agreements to fund used cars at an average price point of c.£6,000 up to a maximum term of 60 months. It has grown its profit every year since inception in 1999.

Perhaps surprisingly given the headlines about the new car market, the used car finance market has proven robust with volumes up 2% YoY according to the Finance & Leasing Association. Impressively Advantage’s volumes advanced have risen 11% YTD, but it’s worth noting that this has come at the cost of increased sales incentives to brokers. The increase reflects a strategic choice to increase the number of internet leads and increase lead quality but will have cost Advantage some gross margin.

Customer numbers have hit a record 63,500 (31st July 62,000) and net receivables now exceed £280m (31st July £274m), slightly ahead of our forecast of £278m for the full year. Full year results mainly depend on collections in the next two months.

At the same time Advantage has slightly increased book quality, with monthly collections up 7% on receivables up 5% and risk adjusted yield up 30bps to 25.2% of average monthly receivables. Risk adjusted yield is calculated as (revenue – impairments)/average net receivables. This metric examines the quality of the loan book by showing ‘clean’ revenue as a percent of loans outstanding.

Aspen (Property) Bridging
Aspen provides 1st charge unregulated bridging loans on residential, commercial, and semi-commercial property across the UK yielding on average just over 1% per month for 6-18 month terms.

The nascent property bridging business continues to grow, but has not performed quite so well in some respects. The company noted that ”some borrower exits are still slower than anticipated” due to market conditions. We believe this is a reflection of the fall in housing transaction volumes rather than any risks associated with individual borrowers. However, depending on repayments/new loans issued in the final quarter, the loan book, currently at £28m, looks like it may end up slightly ahead of our £28.8m expectation for the full year.

Group
Utilisation of the £160m of debt facilities (£132m) leaves significant headroom for growth.

We don’t think it is necessary to amend our forecasts on the back of this broadly positive trading update, but we note the increased acquisition costs will likely start to reduce gross margin slightly. We will revisit the numbers as part of a full review after the full year results have been released early in 2020.

Disclaimer:
This document is a marketing communication which is designed to educate and inform professional investors about the subject Group. The subject Group pays Capital Access Group a fixed annual fee to cover the costs of research production and distribution, and the research has not been prepared in accordance with regulatory requirements designed to promote the independence of investment research. Capital Access Group does not make recommendations. Any comments in this report regarding the valuation of a financial security are based on comparisons with similar securities; they are not forecasts of a likely share price. This document is not an offer to buy or sell, or a solicitation of an offer to buy or sell, the securities mentioned.
Capital Access Group does not buy or sell shares, nor does it conduct corporate finance transactions, nor does it undertake investment business either in the UK or elsewhere. Capital Access Group is not regulated by the Financial Conduct Authority (FCA). Neither Capital Access Group nor the analyst responsible for this research owns shares or other securities issued by the Group analysed in this research note, nor do they have a position in any derivative contract based on those securities.
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[breezer_42] 10/12/2019 11:05

Ah, you may have to have a (free) Research Tree account to access it, but it should be free to view once you have one.

[gabsterx] 10/12/2019 10:52

Seems to be behind a paywall

"This content is only for direct clients of Capital Access Research. Please contact Capital Access Research in order to request access."

[breezer_42] 10/12/2019 08:57

Free (company-sponsored) research now published: hxxps://www.research-tree.com/companies/uk/retail-finance/s-u/research/capital-access-research/s-u-update-note-guidance-re-iterated/23_2019120907430424910

Summary: "S&U this morning released a trading update in which they re-iterated guidance in the face of weaker consumer sentiment and economic activity. Full year results mainly depend on collections in the next two months, but management is confident that the 20-year uninterrupted run of growth in profits at Advantage Motor Finance will continue."

[pugugly] 10/12/2019 07:53

Steady as she goes but downbeat yet concervative tone in view of subdued economy

[plasybryn] 06/12/2019 15:02

SUS Q3 Trading numbers due Tuesday.

[plasybryn] 26/11/2019 07:44

Sorry that Hummingbird , Horizonte, Anglo Asian Mining & Cora Gold haven't done anything yet. More patience required no doubt. Lots of positive views on gold although this further pull back was expected. The case for nickle remains strong I believe. Cheers.

[plasybryn] 26/11/2019 07:29

Did you see Ariana Resources (AAU) news and reaction yesterday as well. Very best of luck for the future.

[gabsterx] 26/11/2019 06:12

@Plasybryn, kicking myself for not buying into GAW when you mentioned it :((

Back on topic was reading this article on the Times, applies to the US but wondering if any of that will trickle across the pond. In any cases SUS is known for it's prudent approach to growth so even if we see a drop in the sector I don't believe its fundamentals will would be affected.

Yield-crazed investors pile into US subprime car loans
ABS are motoring despite weakening consumer economy and rising delinquencies

"There was more than $1.3tn of US auto debt outstanding at the end of the third quarter, according to the Fed, following $159bn of originations during the previous three months — the second-highest quarterly haul on record. Of that $1.3tn, 4.8 per cent, or about $62bn, is seriously delinquent, up from 3.1 per cent or $29bn five years ago. That proportion is not far off the peak of 5.2 per cent in the financial crisis. The trend contrasts with mortgage debt, where delinquencies have steadily declined as a proportion of outstanding loans.

This year a blog post by Fed economists showed that the increase in delinquencies was particularly concentrated among subprime borrowers."

[gabsterx] 25/10/2019 15:35

Thank you all for the suggestions, I'll definately be doing my research into those. A company I recently started a small position in is Paypoint. I like the strong well covered divi, solid cash flows, no debt, high margins and ROCE. Shares looked cheap on a conservative DCF analysis and they will be returning proceeds from a sale of their online business by special divis until end of 2021.

All that being said sorry for hijacking the SUS thread, which I will be holding till the wheels fall off!

[doc60] 25/10/2019 10:31

Gabsterx, if you're looking for a company with a stable share price and good divi take a look at JIM.

[f15jcm] 24/10/2019 23:05

IGG pays a significant dividend and isn't geared to the economy like SUS so it would balance your PF. CEO has been buying. DYOR

[plasybryn] 17/10/2019 20:09

I'm not sure it is a good idea to recommend shares, as I have no idea of your risk profile or sector preferences. Or if you want dividends or just growth. Location is also a big consideration. But I would have a look at GAW. Look at its chart.
If you want a tidier, and believe that gold & silver must do well in this debt ridden, Fiat currency world, then I would have a look at AAU. This is a small gold producer with other great assets. Well run and appears very cheap.
AAZ is another more substantial, well managed gold producer which has recently had a bit of a correction. Pays a dividend.
Longer term plays that look interesting are the Nickel play HZM. Nickel good for electric car revolution. Will need Capex to build mines so some time away yet from production. Has good Institutional support. Cora gold is a longer term gold play (again exploration stage but with good support) and HUM is a recovery gold play. DYOR. Sorry to go off subject. Apart from GAW, these are all much higher risk than SUS of course.

[gabsterx] 17/10/2019 12:16

Can anyone recommend a company of the caliber of S&U? Sold off most of my GFRD shares at about break even and looking for a well run, low-key, stable business to replace it. I'm primarily a value investor looking for income through dividend growth.

Would buy more SUS but it's already my top holding!

[chrismcglone] 15/10/2019 16:59

when I first bought in here I remember losing a big % of my share value initially. Had I not bought almost exclusively for the divie at the time I would have probably panicked and run. Apart from a couple of great wee speculative gold shares, this has turned out by far my best judgement in share purchases.

[chrismcglone] 15/10/2019 16:55

Not much to disagree with that jeffian and thanks for the heads up on the article. Selfishly I would welcome a temporary hit on the sector and some collateral damage to the share price here as I would jump at another opportunity to build a bigger stake for my retirement planning. The last great opportunity I got was around 10yrs ago.

There are indeed so many variables out there which can take any company, product, market by surprise but that’s why Buffet invested as much in the management of the businesses he bought as the business itself. And then left them in place to continue to do the jobs he so obviously valued.

Our wee company would indeed be a classic Buffet buy on so many measures, not least the sector and it’s ‘owners’. Just as well we’re a minnow.

[f15jcm] 15/10/2019 15:22

SUS's annual report said it welcomed the FCA's findings in March, though I'd be worried about another PPI type situation if I had long exposure to this sector.