Stanley Gibbons Share Discussion Threads

[pavey ark] 09/10/2015 08:19

Further to the latest IC coverage.
The analysts at Peel Hunt say that the EPS this year should be C. 9p and 13p in 2017.
Given that the balance sheet is not highly geared (the company should have little debt next year as stock reduction takes place) a PE ratio of 12 would imply a share price of 160p by the end of 2017.
The analysts at Peel Hunt are giving the usual caveat that there is an element of uncertainty in these predictions/estimates but it would seem that there is a pretty fair chance of 60% upside in the next 18 months.
Are we to think that every "buy" recommendation in IC has a better potential return than this ?

[graham1ty] 09/10/2015 07:51

SGI paid £46m for Noble, £8.6m for Mallett. Now capitalised at £45m.

So, if they have not destroyed those two businesses, you get them and then a stamp business thrown in for free !!!! Can that be right ?

[11_percent] 08/10/2015 13:58

Investors Chronicle has today issued a "Sell" advice at 104p. Down 67% from its "Buy" advice at 312p.

-----------

Lol.

My goldfish, Bert, knows more about shares than IC.

[spob] 08/10/2015 13:08

Couldn't agree more

I wouldn't have toched this with a barge pole at £3.12

[brando69] 08/10/2015 12:26

Investors Chronicle know as much about share tipping as Stanley Gibbons know about harnessing the internet.

[whackford] 08/10/2015 12:22

Investors Chronicle has today issued a "Sell" advice at 104p. Down 67% from its "Buy" advice at 312p.

[rivaldo] 08/10/2015 12:10

I'm not a holder here, but an interested watcher for some years - just thought I'd mention that SGI are exhibiting at the London Investor Show on 23rd October.

Holders might have a number of pointed questions to ask whoever is at the stand!

[eastbourne1982] 08/10/2015 11:18

Rightly or wrongly I've topped up with a few more, I notice a lot of the sells on Hargreaves Lansdown website are in fact buys.

[eastbourne1982] 08/10/2015 10:57

Regarding the management, when the share price was £3 - £3.50 they had a hiding place even though they probably were not making the most of the business, now the share price is under £1 there is no hiding place, they should be feeling the pressure and either up their game or someone else needs to step in and have a go.

At the current valuation this should be a takeover target, are there any billionaire stamp collectors who fancy an instant collection at a good price ???

[njb67] 08/10/2015 10:48

I believe that the long term value of SGI as ab investment is ultimately tied to the quality of the management.

Herein lies my problem, the current lot to me are uninvestable.

I will continue to keep an eye on this as I like the brand. In the right hands it could be a good company to own.

[yasx] 08/10/2015 10:44

Eastbourne,
You raise some salient points.

I do not think they have covered themselves in glory with the recent statement reinforcing expectations and contrasting follow up a few weeks later.

Nor have they done a good job with the IT infrastructure.

But, much, if not all of this has surely been priced in.

[yasx] 08/10/2015 10:25

The shares bounced heavily from below one pound back in 2008 - the dynamics are now rather different, but, technically, a rally is on the cards...

[yasx] 08/10/2015 10:17

It is difficult to value the stock given the plainly clear reference to illiquidity and on the basis discounting must be marked.

However, the shares still look reasonably cheap. Coupled with the fact that technically the chart is heavily oversold (Daily RSI is the lowest it has been) and I therefore think that at the very least a trading bounce is due.

I do wonder about the likelihood of an interested party tabling a bid and then selling off stock in a more ordered and less desperate manner...

One can now pick up shares for around 96p, though I suspect we will be back over a pound in short order.

[njb67] 08/10/2015 09:46

On stock valuation.

If the market price of the stock is £150m rather than the £50m stated in the accounts, then I would push my fair price valuation upwards.

I would still discount the stock relatively heavily for two reasons:

(i) The high end illiquidity remains a concern. Has recent years sales been driven by an Asian bubble which has now burst?
(ii) The stock is the equivalent of three years of sales.

[deanroberthunt] 08/10/2015 09:46

spob

are you ill or something ?

[pavey ark] 08/10/2015 09:23

Just a few thoughts here.
This company raised £40m two years ago at 295p with senior management taking over £600k, the company went on to make a profit each year since.
Although the above is hardly inspiring news it does mean that anyone buying at today's price is well ahead of the game.
The recent acquisitions could be thought of as costing a third of their actual cost if paid for by this share issue.
The main point today would seem to be stock value and the accounts show that the management increased the stamp stock by £13m and stock in general rose by £12m.

As rare stamps would be the original company's area of expertise it should be a comfort that this is where the money went. Given this knowledge of the market,investors such as myself who know nothing of stamps and their value, must take note of the fact that management made these purchases because of the opportunity to acquire valuable collections at good prices.
I don't have to know much about stamps to know that there may be few people in the market able or willing to buy entire collections for multiple millions but once these collections are bought the individual stamps and groups of stamps can be sold on.
Obviously SG is in a position to do both.
It is not difficult to see the large stock balance of £53m (cost) being much greater than current market cap and the cash deficit which is projected to reach £17m H1 should be reduced very quickly.
My history here is a very small holding initially then a larger holding with the price drop and I fully understand if some long term holders don't share my rather breezy views here.
(Two months ago this company wasn't even on my watch list and even now it only takes about 1/6 of a group of small cap shares I bought in August. From original purchases 2 up a little, 2 down a little, one practically unchanged and SG!!)

[stevenlondon3] 08/10/2015 08:56

"Open market valuation" implies transactions at those prices. The "illiquidity" comment implies limited transactions. However SG does not want to lower its prices as it would imply that top quality stamp prices were weak and not an attractive investment. Does anyone know what auction prices have been like recently at the top end of the market?

[deanowls] 08/10/2015 08:44

Age of stock?

I reckon the stock is really old and second hand at best!

[shanklin] 08/10/2015 08:39

Surely that is quite a big if? In most second-hand goods, fashions change fairly rapidly, so the idea is to buy on the cheap and realise retail value as quickly as possible, not take a punt on values increasing.

SGI is a retailer, with retailer related costs, not an investment company.

All IMHO.

[spob] 08/10/2015 08:29

If the value of stock appreciates with time

I don't see any rush

just my personal opinion