Vertu Motors Share Discussion Threads

[clive7878] 13/10/2022 19:07

There were 5 sells of 247,825 shares today, which did the damage to the share price

Even Tescos went to under 2.00 today

[clive7878] 12/10/2022 17:02

Much negativity around today along with majority selling.
V

[microscope] 12/10/2022 14:13

FDM, I don't think Inchcape is a realistic comparison. It's a global conglomerate these days, from Kenya, to Chile and even Hong Kong, plus business in insurance, vehicle parts and many others. Attractive investment in its way but on a different scale to VTU.Motorpoint is very much the odd one out in the sector. Despite a 60percent fall in the shares, from memory is still on a p/e of around 25, against 5 or 6 here.Also it operates from only 18 or 19 outlets, so it's again a dubious comparison.Vertu has dealt successfully with margins in the last 18 months and said they're still strong.OT yes, it's interesting. Once before when they announced a buyback they didn't start straightaway until they announced an acquisition shortly after. But this time I wonder if they're the hunter, or hunted....And that brief dip earlier today followed by two 100k trades, I wonder if that was our seller clearing.

[otemple3] 12/10/2022 12:47

Anyone know why they have not bought back any shares yet??? Seems odd

[fun der mental] 12/10/2022 11:59

What concerns me with VTU is that the ROIC, ROE and Operating Margins aren't close to some of their competitors like Inchcape and Motorpoint - the thin operating margin worries me given inflation isn't likely to go away anytime soon.

I accept that the company is trading cheaply to NAV but my question is how do they unlock this value?

[clive7878] 09/10/2022 12:09

Share trading a bit flat today with mostly small sells.

Bit on Rip Off Britain about Clinch, and some buyers having a bad experience.
Clinch sells roughly 45k second hand cars a year out of a total sold per year in the car market of 7.5m
I personally would rather see and test drive any car in per person, rather than buying online,
but that is open to preference.

I notice on Autotrader that some cars were taking longer to sell.

[clive7878] 07/10/2022 22:26

Year end pretax profits now expected to be £38.5m with full net cash of £21m. A very financially sound & managed company.

[microscope] 07/10/2022 15:06

Agree entirely Rabid, plus a 3 million buyback which will help the price too. It's not a beauty contest, though the balance sheet certainly is a peach, and smart investors buy before the crowd arrive. Which all reminds me, how is that Israeli shipping thing doing, that our resident bundle of joy was so keen on.....

....Oh I see now, 34p to 24p, in a month, since put up..

[rabiddog] 07/10/2022 14:38

Sunshine..the global economic woes are more than baked into VTU share price. Cash rich, asset rich, well run and made most of the predicted yearly profit in first 6 months. Dividend well covered, potential acquisition target…very happy to keep topping up at these prices.

[sunshine today] 07/10/2022 12:07

Do you think for one minute the average second hand car value is unaffordable without credit, for the vast majority of potential purchasers.?

Affordability comes to mind when borrowing rates triple

[davebowler] 07/10/2022 12:06

Zeus on Motorpoint -
Yesterday Motorpoint released a H1 trading update showing strong revenue growth but significantly lower profits and a worsening outlook. We reduce our EPS forecasts for FY23, FY24 and FY25 by 50%, 56% and 44%, respectively. This is driven by lower sales volumes, due to demand headwinds and continuing supply shortages, plus ongoing costs to improve the Group’s digital offering. Shares now trade on a one-year forward P/E of 25x, falling to 14x by FY25, still a material premium to the average of its listed peers (6x FY3).

[clive7878] 07/10/2022 12:00

Vertu was written up in the Investors Chronicle today - stated as a buy.
It is the 4th largest motor dealer based on turnover and is much better value than PDG and Motorpoint however. The forward pe ratio is said to be 5.7.
The asset value including intangibles of 31p is said to be 91p
It appears to be a very well run company.
The average cost of a second hand car is now £19.958 and new car is around £24k
The fall in future profits may not be as bad as is currently being predicted.

[sunshine today] 07/10/2022 09:57

As predicted absolutely no interest to buy a stock with falling profits, ( no matter how good the valuation might be.)

[tomps2] 07/10/2022 09:49

Vertu Motors interim results webinar - October 2022

Vertu Motors Chief Executive, Robert Forrester and CFO, Karen Anderson, present interim results for the six months ended 31 August 2022, where they anticipate the full year profits to be ahead of expectations.

Video:

Podcast:

[pj84] 06/10/2022 22:56

Vertu Motors is too cheap, says Liberum
Vertu Motors (VTU) is too cheap considering it is well positioned to consolidate the car dealership market, according to Liberum.

Analyst Sanjay Vidyarthi retained his ‘buy’ recommendation and target price of 100p on the stock, which jumped 6.4% to 46p on Wednesday.

The group delivered a strong first half, with profit before tax 14% ahead of expectations.

‘Current trade continues to show similar trends, with supply constraints supporting margins,’ said Vidyarthi.

‘We think that the trading environment will remain robust, with cost pressures the big variable.’

He increased full-year 2023 adjusted-profit-before-tax estimates by 9% to reflect the first-half beat and a good start to the second half, but he left profit forecasts in outer years unchanged.

‘A current-year 2023 price-to-earnings of just 5.2x is too cheap for a business that is so well positioned to consolidate the market,’ he said.

[clive7878] 06/10/2022 20:25

Should be a buy in the Investors Chronicle tomorrow.

SIMPLY WALL says -
Trading at 45.1% below our estimates of fair value
Earnings are forecast to decline by an average of 16.4% for the next 3 years
Dividend of 4.57% is not well covered
Debt level is low and not considered a risk

Snowflake Analysis -
Undervalued with excellent balance sheet.

I would have thought that - as in the advfn financials - that the dividend is covered by 8 or 9 times though.
What the full years estimated profits and eps are - I must say I have since no figures, but if doubling up the 28.6m to 57.2m over 170 capitalisation then that gives a forward pe of just 3, so there is plenty of movement for a slight downturn in profits. And the company appears to be well run.

All in all - sounds ok ! Only as in all cases time will tell.
The ftse main stocks - Tesco, Sainsbury, Vodafone, Barclays - although the dividend yield seems at least now to be very good - the share prices are flat and looks like it may take several months to recover.
The

[clive7878] 05/10/2022 21:04

Trading still appears to be strong, so full years results should be quite solid.
If VTU has made 28.2m profit half way, that is quite good with a share price of £46p,
and considering the capitalisation. But what eps and profits are we looking at for the full year - I did hear that VTU expect to be ahead of expectations for the full year - but I did not hear what those expectations were. None the less if they make double £28.2m then that still puts them on a very low pe ratio.

There are always a group of people in society with good, or very good jobs who have a fair bit of money to change cars, the rest just buy what they can afford.

Times are going to get harder especially when people have to remortgage now at double the cost or more - who are on fixed rate mortgages - and then there are the 2 million that are on variable rate mortgages - than it would have been in last December.
And obviously it will affect other purchases like cars. VTU does appear to be well managed which is a bonus.

Hopefully we can look forward to more good news to come.

[sunshine today] 05/10/2022 19:46

From America today.

For the week ended Sept. 28, 2022, a 30-year fixed-rate mortgage was 6.70 percent, which is more than double what it was a year ago, at 3.01 percent.

“The current [mortgage] rate has more than doubled over the past year and has increased 130 basis points in the past seven weeks alone,” Kan said.

“The steep increase in rates continued to halt refinance activity, and is also impacting purchase applications, which have fallen 37 percent behind last year’s pace.


////////////////

That’s the housing market, the other big ticket item is for most households is the car.



It’s way way to early to think your near the bottom

[clive7878] 05/10/2022 19:43

I did post in 2298 yesterday - as I could not resist buying some stock yesterday

" to be able to buy at 35p or 30p is just not going to happen - the financials are too strong.
The stock is worth a minimum of 50p all day long, even 60p. Even with a -28.6 drop in earnings over the next 3 years - as per Simply Wall - VTU could still be very good value. "

It did not surprise me at all that the stock gained 2.5p.
The current pe ratio has factored in most of the gloom and the doom of the current market and the share price had fallen too far. A historic pe of 2.5 was just getting too silly.

[microscope] 05/10/2022 18:53

Did warn you folks last night! :)

You 'don't understand' margins.... Why does that not surprise me? Good grief (and g'night).. off to enjoy footie.

Do love a 'coincidence' though :))

2196.

2197.

'PurplePelmets1 Sep '22 - 02:41 - 2196 of 2315

...6 mnth target price 30p'

'sunshine Today1 Sep '22 - 07:24 - 2197 of 2315
That’s been my view here for the last 18 months...'


LOL :)

C U in 6 months.... Not Happening, sunshine. :)

TNAV 71p+..

[sunshine today] 05/10/2022 18:32

“A tight supply environment for new and used vehicles is anticipated to continue well into the next financial year. Margins are therefore expected to remain strong and used car pricing robust.


Umm I don’t quite understand this.

If the customer is broke,

1/ servicing is put off

2/ A new car is out of the question.

3/ Some sell the car full stop.


A glut of unsold cars is the end result, however the competition wants to see tomorrow, so they slash prices, because profit, no longer tops survival.

[sunshine today] 05/10/2022 18:12

microscope

With respect since I posted my views here the stock has gone one way.

Down.

BBC news is playing the news right now,

2 year mortgages fix is now over 6%.

What’s that doing to car finance

What effect on the consumer