Tp Icap Share Discussion Threads

[japatrick] 20/3/2024 09:47

nice if in at Chris mills levels
Liquidnet still a dog
hiding other revenues in there won't help - voice broking treasuries etc
management weak - improved post merger with Icap but that crowd now left
strategy is off - who on earth responsible for that ?
bgc and e -platform performance is strong/out performs tp and Icap
keep in for dividend maybe - sale of data unit been floated before old news
income funds like it could do with a change of management to flush out also rans

[ppreston1] 19/3/2024 16:15

Totally agree with you. JP Morgan price target seems pretty conservative. Liquidnet isn't the same business as it was 1 year ago. Coming along nicely now. Also throw in the possible Parameta minority IPO into the mix as well. Seriously undervalued.

[ggrantsu] 19/3/2024 14:54

cheers Preston...I've read their note.

the really key thing is their words at end commenting on the target multiple they give 'we realise this is still a large sifgnificant discount to other financial structure platforms, which generally trade on high teen multiples or more'

still so much upside here as Liquidnet improves and the solid performance continues. target price for starters in my view should be 3.50.

[ppreston1] 19/3/2024 09:24

JPMorgan raises TP ICAP price target to 274 (259) pence - 'overweight'

[jeffian] 13/3/2024 23:01

"The market can stay irrational longer than you can stay solvent"

That is often wheeled out on these boards but the reason I like the 7/7 or High Yield/Low PER approach is precisely because it is the antidote to that saying. I piled into those stocks in 1998 when the dotcom boom was all the rage because on an undemanding valuation and paying me a reasonable return in the meantime, I could afford to wait for the market to come round to my way of thinking, which it did (i.e I was able to remain solvent until the market became rational).

[thorpematt] 13/3/2024 20:21

jeffian,

7/7 I think, is a Lord Lee quote. I always find him to explain things in a remarkably simple way (considering his success). KISS I suppose.

I myself, have a number of approaches to my investing. Too many I suspect. "One should find out what they are good at and stick to it" is what I tell newbies who ask.

To this end I have tried to categorise my "bets" and then analyse at year end what I am bad at (and stop doing it). And vice-versa.

Currently I like the 7/7 thing because there are not usually many to choose from. As you say there are many High yield/Low PER stocks that can sit comfortably in the portfolio so I like a bit of comfort to balance my riskier stuff.

On the LSE: I do think the tracker fund trend is a big issue. In essence Momentum gets rewarded and value gets punished. SO much money has come out of managed funds and Hedge funds that now the trackers compound over-valuation in US markets and compound undervalueation in ours.

I have no idea what will happen next so I am going to defer to Ben Graham:
"In the short run, the market is a voting machine but in the long run, it is a weighing machine."

...then again, he also said:
"The market can stay irrational longer than you can stay solvent"

:-/

[jeffian] 12/3/2024 22:56

Thorpematt,

I agree with your approach but I hadn't heard the 7/7 thing before. I have bored people to death with my High yield/Low PER approach (same thing) which was the foundation of my portfolio in the run-up to 2000 and proved spectacularly effective (at least until 2008!). It's still something I feel very comfortable with.

As far as LSE is concerned, clearly the domestic market has shrunk. IMO, in large part this is to do with the institutional shift from equities to bonds, meaning that the UK instis are no longer the driving force that they were. I also have a theory that the current fashion for share buybacks (which I hate as a method of "returning value to shareholders", which they don't) is simply shrinking the market. Last time I bothered to look, over 30% of all daily RNS announcements were "Transactions in Own Shares"! BUT. This is a global market. If London is as cheap as people say it is, why aren't international investors swooping in and hoovering up cheap stock?

[thorpematt] 12/3/2024 19:35

I note that Stockpedia has a ranking of 100 on this.

I originally invested here after it came up on one of my value screens.

In my opinion Stocko has the EV wrong on this because the client money should be ring fenced in the calculations. Nevertheless I do concur that this is profoundly discounted. Also I perceive that the recent downtrend in the stock price is overdone.

In any event this remains one of my top holdings and I am rather pleased in today's move. I think there is much more to come.

I have mentioned 7/7 stocks before (apologies if repeating myself). In essence a yield of 7 or more and a PER of lesss than 7. There are quite of few of those on the UK list at present. Including TCAP

I am (mid-term) optomisitc on UK listed stocks and future returns. I think this link explains that in part at least: -

[t-trader] 12/3/2024 18:11

Agree, would need to be US listing to be of benefit.

[hatfullofsky] 12/3/2024 18:07

US IPO would make a lot of sense

[dope007] 12/3/2024 16:41

Can't see a minority IPO working. It again relies on the market to value it correctly and if on the LSE then good luck. However I would expect most funds would want a full IPO and traders would need a good float for trading it.

For me either keep it 100% or a full IPO at full price. Keeping it should be the best option and let those moaning about the stock price sell their stock to someone else.

[t-trader] 12/3/2024 16:34

They plan to hold on to Parameta. Any IPO will only be for a minority stake which to me is the sensible option.

So retain the asset, capitalise on future growth and unlock additional shareholder value with a minority IPO.

[t-trader] 12/3/2024 08:47

Good set of results and a possible IPO for Parameta although only a minority stake.
Share buyback and a significant dividend increase.

Great stuff

[podgyted] 10/3/2024 20:30

Lets see if they get to an IPO before a US hedge fund bids for them.

[value hound] 10/3/2024 07:16

Yes - as mpage says from the FT...

"TP ICAP separates data unit following investor pressure

Parameta Solutions registered as standalone company in preparation for potential listing or sale.

--

UK broker TP ICAP has separated a fast-growing division that sells data to traders as it attempts to respond to pressure from its investors to return capital.

The data unit, Parameta Solutions, was registered in February as a standalone company as TP ICAP prepared a possible sale or listing of it, said two people with knowledge of the matter. Parameta is registered as a separate company on the Jersey companies register.

The decision to separate Parameta follows intense pressure from some of TP ICAP’s biggest shareholders to offload it because of the broker’s sinking share price. One investor said Parameta could generate as much as £1.5bn from an initial public offering, which is more than TP ICAP’s entire market capitalisation of £1.46bn, based on its stock price on Friday.

In 2022, the City of London broker was lambasted by a US hedge fund for its “disastrous share price decline”, and investors had called on the company to either sell itself or Parameta. The separation of Parameta indicated that those plans were now on track, the investors said.

TP ICAP’s share price has recovered about 70 per cent from its 2022 lows but is still depressed, trading flat over the past year.

[mpage] 09/3/2024 17:18

FT today reports that in February Parameta was registered as a separate legal entity after pressure from major shareholders. The main purpose of this is supposedly tax efficiency in the event of an IPO/sale.

[xamf] 19/2/2024 10:38

Took a risk and sold around 190 (hoping for a short term retrace) as it was struggling to make headway. Chuffed to catch them at 177 this morning. This is a cheap stock for the sector with respect to book/div yield/div cover/net debt position as has been discussed already. Recent market volatility should help boost profits further.

Final div last year 7.9p. There has been a consistent final div (ex div April) between 2012 and 2020 of 11.25p/year. Hoping to see an increase in the final dividend on 12th March.

[xamf] 19/2/2024 10:35

My apologies - duplicated post.

[xamf] 19/2/2024 10:25

My apologies - duplicated post.

[ggrantsu] 13/2/2024 16:53

good find preston that FT article...

plays directly into my thesis that we are on for a stunning year ahead here at ICAP. one of the few names out there which directly benefits from financial market weakness/meltdown!

unbelievably cheap...with the highest FCF yield and net cash position combined in the UK markets. and that cheapness is before factoring in the real value of Parameta...totally confounds me the lack of interest in this stock.

[ppreston1] 13/2/2024 14:27

Perversely, higher interest rates for longer should be good for TCAP. The recalibration of expectations for an interest rate cut is clearly a positive here, and I'd expect the share price to react accordingly once the market begins to understand their business model. Hopefully, final results on 12th March should underscore this point.

[ppreston1] 13/2/2024 13:55

Here's some more positive newsflow from Liquidnet. This FT article from a few days ago indicates they are capitalising on the turmoil in the global property market hit by prolonged high interest rates https://www.ft.com/content/e0f66ca3-aac3-4775-b3ad-f0c8a71d08e6"Broker Liquidnet said it has seen a surge in trading volumes in real estate investment trusts, and also in property-related debt - not just in the speculative part of the market, but also at the more conservative end of the spectrum that is "not used to seeing such volatility".At the start of last year, it added, real estate related flows accounted for a single-digit percentage slice of its overall trading, which is focused on illiquid assets. That has now swept up to around 16 per cent of a total that is also growing fast. Not all of this is distressed, but some of the debt is trading at prices as low as 30 cents on the dollar.

[elsa7878] 24/1/2024 16:47

The elephant in the room is naturally cum-ex.....seem to be more cases coming to court and settlements with banks....the situation here is as clear as mud!

[ppreston1] 24/1/2024 11:26

Elsa, great find with that article! This indeed looks very encouraging. Everyone pretty much agrees they overpaid for Liquidnet, and the performance has been a dog ever since. However, if they're beginning to turn things around as the article suggests, this could signal a major rerating. Right now, the value of Liquidnet is discounted for free based on the current market cap and has been a drag on the share price. Final results on 12th March should give us a clearer picture. Looking forward!