Vale Int Share Discussion Threads

[rainmaker] 15/5/2006 01:31

Valhamos-Many thanks for drawing my attention to those Postings, as would almost certainly missed them as I very rarely visit MF, let alone Post there.I suppose the Company's Brokers, Corporate Synergy, will update their VIG forecasts after the AGM.Hence the forecast for the current year is the same for 2005 after accounting changes which will restate 2005 figures and nothing for 2007. Will find out when AGM takes place but if anyone knows and can save me the trouble, then please post the details here.

I'm always very interested in hearing other Value Investor's opinions-and they are definitely glass half empty Value Investors which commendable-its shame they don't post here.They have made some valid and thought provoking comments!! Nevertheless, I'm not as pessimistic/conservative as AIW in that I strongly believe that the Company's full market value can be realised without a Bid and I would justify that comment by stating the following points-

1)Historic organic growth rates in sales-compound growth rates in turnover for the last 5 years is 15% pa
2)Gross Margins-there're around 90%
3)Accounting changes-purchased goodwill no longer being amortised which will mean Company makes a pre and post tax profit-see my earlier posts
4)Control/management of costs
5)Synergy- Company has been creating value by increasing its geographical spread whilst adding value via bolt on acquisitions to broaden its product range ie Smirtware is a good example although they paid approx 20 times after tax earnings for this acquisition-apparently no bargain, on the basis of its four months contribution they will increase the comparative figure for net income figure six fold on an annualised basis and pay for the acquisition from Smirtware's profits alone in three years assuming a static contribution after the first year
6)Cash generation

Enough said!

regards

[valhamos] 12/5/2006 22:02

I've just noticed this post by AliceinWonder (Colin) over on Motley Fool:



For me I think he overdoes the negative tone (also VIG hasn't been quoted on Amex for a couple of years, and I wouldn't necessarily agree with his criticisms on cash), but his post does echo my comment here of a couple of weeks ago (post 282) about the company's poor communication and expectations management when they announce each half-year's results.

Here is what he says:

"Communication is poor, correction, communication is terrible

Bear the following in mind:

EBITDA

H1/04 – £304k
H2/04 - £222k
H1/05 - £556k
H2/05 - £201k

Now let us link the above with the Chairman's guidance.

Chairman's outlook: 13/04/05 – "The outlook for 2005 is more difficult to predict than usual as a result of varying macroeconomic and industry indicators."
Outcome for H1/05 – best half-year in recent history

Chairman's outlook: 7/09/05 – "We look forward with optimism to the rest of the year and beyond."
Outcome for H2/05 – weakest half-year in recent history

Chairman's outlook: 8/04/05 – "Much has been achieved in 2005 .... Current indications are that further improvements will be achieved, particularly in the second half of the year."
Outcome H1/06 – who knows?"


Who knows indeed. I haven't a clue; could be anything from £200k to £500k.

Don't get me wrong. Overall I am quite positive about this company. I would love to add to my stake but too much information is missing. I look forward to reading the annual report to see if I can glean anything else and maybe I should go to the AGM to find out more.

[rainmaker] 11/5/2006 12:23

Well down Trixter!!!-If you are a Value Investor, which you are if you are involved with VIG at current levels, is patience is required but you will be well rewarded!!!

Regards

[trixter] 11/5/2006 11:03

RM - still here. Nicely in profit and in for the long term with this one.

[rainmaker] 10/5/2006 23:37

Des re future returns although the Company is currently priced as a Value share, given a 15% historic compound growth rate in sales and Gross Margins around 90%,I expect,medium term at least, most of the future returns to come from Capital Growth rather than Income. When the Company does introduce a Dividend I expect it to be no more than about 20% of Net Income. Only when the Company's enters its so called, stable phrase(see three stage dividend discount models)-when it grows at the same rate as the nominal growth of the Economy at large, would I expect the payout ratio to be raised to 50% or 60%

regards

[rainmaker] 10/5/2006 23:25

Hi Des-I agree about the spread-it would be difficult not to!!An approx 30% spread dealing cost at current levels-ie (13-10)./. 13 x100.But,as evidenced by this afternoons trades, the real market is probably 11/12p. The more interest that can be generated in VIG, the more competition there will be between the MMs and the spreads will (hopefully, in theory) narrow,.Another problem is that the major shareholders in VIG hold aroung 56% which is a large proportion by any standards

Surprised there is not more interest here or maybe other Contributors have sold out-I hope not as I strongly feel there is plenty more upside

regards

[deswalker] 10/5/2006 17:51

The spread's back out to 30% (10 bid at 13). Ridiculous.

Lifting the 13p offer is still way too cheap (IMO, DYOR) but who is going to do it and immediately say goodbye to all that cash on a mark-to-market basis.

I'm still seeing most of my long term return direct from the company in the form of divis rather than waiting for a friendly mm to show me a decent bid. Either that or a future takeover at a 30% premium to the prevailing bid price (ie at the prevailing offer price :-)

Liquidity is seriously affecting value here IMO. Here's hoping that it will out somehow.

Grumble over.

[rainmaker] 10/5/2006 12:51

Re PG-If you 2.7 mln shares purchased for £200k at just 8 pence(they certainly picked Guinness's pockets on that one!!)then to spent a further £20/39k buying at 11 and 12 p makes sense. Don't presume it is PG as there are other interested Parties, not least, the Directors. IMHO still incredibly cheap at these levels!!!!!!!!!!!!!!!!!

regards

[rainmaker] 10/5/2006 12:39

I'll be looking out for some large protected purchases to appear later on this afternoon. But the point has been made several times, the fundamentals of this Company IMHO all point to a screaming buy. I just wish the Company's Brokers would get there act together!!!!!!!!!!

regards

[rainmaker] 10/5/2006 12:36

HP-a small illiquid stock like VIG where the majority of shares are held by Institutional Investors,fundamentals aside, is fairly easy to manipulate if you are dealing in reasonable volume. Where to now?

regards

[hugepants] 10/5/2006 08:41

I wonder if its the Hammer pushing the price up.

[deswalker] 09/5/2006 17:50

Some relatively big trades this afternoon.

[rainmaker] 09/5/2006 00:48

Thanks Des,so purchased approx £3k's worth,by no means large but nevertheless meaningful. It would be nice if the FD followed suit, as investors pay far more intention to their purchases. In fact historically their purchases have been the best guide, director wise, to future share price increases

regards

[deswalker] 08/5/2006 14:39

Chairman buys 30k shares. RNS just out.

[rainmaker] 05/5/2006 12:49

SP just needs to clear some recent overhead supply at around 11 p then plain sailing

regards

[rainmaker] 05/5/2006 12:47

When are the Company's Brokers going to update their EPS estimates?Given the long range growth and operating leverage, feel that 1p for current year is reasonable so on that basis,a prospective p/e on that basis of 10!!

regards

[rainmaker] 05/5/2006 12:41

Was beginning to think that this share only had a reverse gear!Number 16 on ADVFN top 30 risers

regards

[rainmaker] 04/5/2006 12:29

Varies-Would strongly recommend that you just run VIG and,if need be,wait for a couple of years. What impresses me about the People on this thread is that they are not panicked and seem prepared to wait. IMHO there are communication problem and general PR issues with this Company but that will only affect the share price in the v short term

regards

[Abuse team] 03/5/2006 14:34

Post removed by ADVFN

[varies] 03/5/2006 14:26

Rainmaker
Thanks for your comments on PG
If nothing else happens this year, there is at least a hint that we may see a dividend

[rainmaker] 03/5/2006 12:34

I'll have another look but Value wise very little going on in the market.Total Systems(TTS) are very attractive over a two year time horizon but nothing else I can see!!I note that there share price has been gradually creeping up over the last few days.

regards

[rainmaker] 03/5/2006 12:29

Is anyone going to speak to Corporate Synergy the Company's Brokers?

regards

[rainmaker] 03/5/2006 12:28

Thanks EJ-I looked at that six months ago-no interest as from what I remember a dreadful trading record and a weak balance sheet plus a manufacturing business which all things being equal, is a biggish negative

regards