Stanley Gibbons Share Discussion Threads

[cockneyrebel] 06/2/2004 17:21

I think they are getting to more collectors and potential collectors via the internet.

Also stamps are more in vogue again. Buy to lets not doing as good as they were, unless your a shares anorak like us then finding a stock or fund for your money is tough, Gilts and fixed interest not exactly exciting.

Stamps are pretty tangible collectors items, rose around 9% last year and are expected to do the same again or better this year.

If you stripped out the cash and the value of PRVD (which they could sell their stake in and return the cash to shareholders) then the forward PE is probably around 7 - as it would be if they sold the PRVD stake and bought back shares in the Stanley Gibbon company. But no need to do anything like that at the moment cos PRVD is rocketing.

CR

[taurusthebear] 06/2/2004 17:02

OK, I can see the earnings growth, but can you tell me why? With CKN, HRN, MBY and, to a lesser extent, VCP, I can see what is driving it, but I can't quite see how having a good web site will drive profits ahead? Or is it purely based on the underlying, and increasing, value of old stamps (hey, I've got a Penny Black!), which surely ebbs and flows in unpredictable fashion!?

Having said all that, still haven't read up too much - will do, but it's time for a beer or five now (midnight on Full Moon night in Thailand!). Good weekend all! :0)

[cambium] 06/2/2004 16:57

10sells 2 buys today - nfm

[daza70] 06/2/2004 16:45

prvd going mad!!!! Up 6.9% now to $22.46. What does this make the stake worth anyone??

[cockneyrebel] 06/2/2004 15:55

Great tip - from a guy that can't work out how to release the cap lock on his keyboard.

CR

[pill box] 06/2/2004 15:52

YOU GUYS NOT BOUGHT INTO EIC...EINSTEIN..WE ARE ABOUT TO GO BALLISTIC..WONT BE ABLE TO TOUCH IT AT TODAYS PRICE ...NEW DEAL BEING FINALISED...RNS ON THE WAY GET IN GUYS WE ARE GONNA FLY..KEEP WELL.....PILL BOX..

[cockneyrebel] 06/2/2004 15:52

Taurus - 0.95p eps in H1.

With 3.3p expected they will have done 2.35p in H2. On that basis the 5.7p eps for the year ahead looks well achievable to me if not easily beatable.

So a forward PE of 10 and 3 years of very strong earnings growth.

Undervalued assets on the balance sheet.

Web sites now picking up a huge growth in hits.

Only a fraction of the market tapped.

Potential for a divi soon.

I can see these trading on a forward PE of 20 myself but just a PE of 15 = 85p a share.

As always, do you're own research and I know you will before committing.



CR

[daza70] 06/2/2004 15:40

Originally posted nov 9th 2003

Medium Term Target 70p


Stanley Gibbons recruited over 4000 new customers in the first 6 months of 2003. Keeping pace with changing times, today's new stamp collectors are likely to be looking for an alternative investment opportunity as well as a hobby.

As any collector will tell you, the prices being asked and paid for specialist stamps and covers provides plenty of evidence that the financial future for stamps is very good indeed

With over 30 million stamp collectors worldwide the hobby has a very solid collector base and a liquidity of market that no other alternative investment can offer. Consider this point, as people use this market and therefore Stanley Gibbons for investments.

Simple laws of supply and demand dictate the value of stamps.
All this said it comes down to collectors and what they are willing to pay but an interesting quide of value would be the index produced.

[taurusthebear] 06/2/2004 15:32

OK, CR - having only started looking at SGI in the past hour or two, I readily admit that I'm not up to speed yet. Will remedy over the weekend! :0)

EDIT: However, if they do 3.5p (3.3 already supposed), then they are still on a PE in the high teens! Admittedly, to this year's results, but still, not a screaming bargain, I would argue. FWY isn't valued on it's share of Computerlinks, or Hornby their cash (apparently, but who knows?), so why should people take any notice of PRVD?

[cockneyrebel] 06/2/2004 15:29

Remember they have a holding in PRVD that looks like being valued way ahead of what's on the balance sheet Taurus.

And it's the growth in earnings expected this year over past year. Look at the earnings that are expected in H2 if the results meet expectations (as they have said they will do). Translate that to next year and thes elook very cheap to me.

CR

[daza70] 06/2/2004 15:14

prvd up again to its highest level @ $21.75.

[taurusthebear] 06/2/2004 15:11

Well, if you're going to assume 70% earnings growth this year, that would put VCP on a forward PE to 2005 of less than 5! ;-)

But that's it! Why should they do 70% growth just because the broker says that? Where is it going to come from? Are you going to say: "increasing sales, margins and more effective sales channels", because if so that isn't an answer, to me. You have to justify why that growth will continue! Are stamps a burgeoning market, and if not, why should SGI gain market share from others?

I wait to be enlightened (or not)... :0)

[nurdin] 06/2/2004 09:26

For those still sitting on the fence and waiting...have a sniff of this:

-70% eps growth in 03 (in the bag)
-70% eps growth forecast for this year which could prove conservative
-PRVD stake worth 10p a share currently
-cash worth 4p a share
-stripping out cash and equivalents you paying 46p on current offer.
-expected to make 6p in 04, thats a multiple of just 7.6!!

PRVD stake could get upto 20p by the year end...and if we are lucky the stake could be sold off and the cash returned to investor.

Can you find a cheaper stock?

[cockneyrebel] 05/2/2004 22:34

What ja mean - this stock was my idea :-)

CR

[nurdin] 05/2/2004 22:31

Cant wait to see the results..think I might yet win your 1 bagger competition :o)

[cockneyrebel] 05/2/2004 22:26

Looks to me that they could sell there stake in PRVD at the end of the year for well over 20p a share - nice if they handed that back to investors.

I like statements like this:

"The Board is committed to realising the potential associated with being the only
recognised brand name in an estimated $10 billion per annum market and to
continued growth in revenues and earnings over the second half of the year and
beyond."


CR

[mo123] 05/2/2004 22:19

On these figures around 6.6. Wonder when the market will wake up to potential of SGI.

[nurdin] 05/2/2004 22:14

sorrry correction above...at interim they had over £1m in cash..that equates to 4p a share!So cash and PRVD stake is already worth 14p a share and could be worth 16p a share if PRVD hits $24.!let you work out the pe as I just cant believe it!

[mo123] 05/2/2004 22:10

Cheers nurdin. Dont know why I didn't think about the cash that SGI are currently holding. As you say it makes them look very cheap indeed.
Mo.

[mo123] 05/2/2004 22:04

Thanks for the info Gateside. Will practice at the weekend when no ones looking. :0)

Mo.

[nurdin] 05/2/2004 22:02

Mo..its easy when you know how :o).But that link by Gateside explains all..

Apart from the PRVD stake,SGI also have cash of around £1m on the balance sheet...equating to another 2.9p a share!Strip out the cash and the PRVD stake and you buying the business at close to 41p.On that basis they are trading on 2004 pe of 7.3 (even after the recent rise) with earnings growth of 70% this and the next year!.Find me a cheaper stock and I will buy it!