AFG - Allco Finance Group

[3 veiws of a secret]

Sorry guys to disturb you from your cricket ....BUT AFG has a trading halt true or false? According to my screen only trades accepted today where up to and including 10am? tea break grrrrrrrrrrrrrr Anybody got any news?

 

[BlueTrader]

3 veiws of a secret, you must be a fortune teller!

Trading Halt, coming off the earlier of Wednesday or the issuing of an announcement, was announced after 6pm last night. A $500M capital raising was also announced - 2 shares for every 19 held offered for $8 each.

Another announcement coming - seems likely Allco will get involved in the Qantas deal if it goes ahead? Allco has also recently significantly bulked up its debt facilities and looks set to pursue growth at pace.

 

[michael_selway]

3 veiws of a secret, you must be a fortune teller!

Trading Halt, coming off the earlier of Wednesday or the issuing of an announcement, was announced after 6pm last night. A $500M capital raising was also announced - 2 shares for every 19 held offered for $8 each.

Another announcement coming - seems likely Allco will get involved in the Qantas deal if it goes ahead? Allco has also recently significantly bulked up its debt facilities and looks set to pursue growth at pace.

will price fall or go up because of cap raising?

thx

MS

 

[3 veiws of a secret]

will price fall or go up because of cap raising?

thx

MS

At the time I sold CTX and was watching AFG drop to levels of $10.21~$10.26......at the last 15 mins of trading I was anxious to get a print out of how much money was in my bank account.When I found out and looked at the time there where minutes to go I think the price jumped to $10.32 so I said what the heck lets try first thing in the morning ........well history takes over and the share just took off. Question my timing sure but instant karma going to get AFG ,haaaaaaaaaaaaaa and yes dilution of this or that ,but will the price plummet to $9.98 ???? as what was the scenario 3 days ago. No lesson learn't here ...just a case of timing,and being conservative/anxious from time to time ,I can live with that!

 

[BlueTrader]

Hi Michael,

It doesn't look like the share price will go down - a fair bit of excitement and promise over future deals.

The market should be supportive of why the capital raising is being done, basically for similar reasons as the recent BNB and MBL raisings, for growing their respective businesses. Now that RCD and allco have merged, they are stepping on the throttle to extend their investment banking opportunities.

There will be bookbuilds for shares not taken up and these shares should be in high demand, producing a higher bookbuild share price.

 

[Julia]

Any current holders of AFG?
It has drifted lower since the failed Qantas deal.
Anyone know anything else that could be causing its fall from favour?

 

[michael_selway]

Any current holders of AFG?
It has drifted lower since the failed Qantas deal.
Anyone know anything else that could be causing its fall from favour?

It might be a good buy soon i think

Earnings and Dividends Forecast (cents per share)
2006 2007 2008 2009
EPS 49.4 61.5 75.6 88.5
DPS 41.0 41.0 42.5 52.0

EPS(c) PE Growth
Year Ending 30-06-07 61.5 16.6 24.5%
Year Ending 30-06-08 75.6 13.5 22.9%

thx

MS

 

[reece55]

Of the investment bank style entities, this one has been hit the hardest.

I remember reviewing AFG with one a friend indicating a head and shoulders pattern on the weekly time frame that pointed to 6.90 as a target - initially even I thought that was just a ridiculous target, but what do you know, it actually payed out.

AFG is in deep trouble, with a down trend that just looks terrible. I think clearly there are some impairment issues with their receivables not contained within their financial statements, because valuation wise these guys are actually pretty cheap. Still, the interest margin they achieved as Record Investments always bemused me as it was so high (like 12% and up) - you don't achieve that without taking on some risk.

Cheers

 

[Ken]

This one moves around a lot.

Good for trading.

I reckon anything under $8 and with a yield of over 6% is worth considering.

The trend may be ugly, but for fundamental investors, the numbers stack up at the moment.

Directors buying. If you're entering large might be worth buying in stages to average your price out.

AFG potential to rise in big percentages, so might not be a trend to spot.

I hold as of today at 7.68 after trading it 5 times for small profits.

 

[michael_selway]

This one moves around a lot.

Good for trading.

I reckon anything under $8 and with a yield of over 6% is worth considering.

The trend may be ugly, but for fundamental investors, the numbers stack up at the moment.

Directors buying. If you're entering large might be worth buying in stages to average your price out.

AFG potential to rise in big percentages, so might not be a trend to spot.

I hold as of today at 7.68 after trading it 5 times for small profits.

Yep fundamental numbers look now, when price has fallen

Earnings and Dividends Forecast (cents per share)
2007 2008 2009 2010
EPS 63.9 76.5 92.5 106.1
DPS 44.0 44.0 46.5 52.0

EPS(c) PE Growth
Year Ending 30-06-08 76.5 10.0 19.7%
Year Ending 30-06-09 92.5 8.3 20.9%

Thanks

MS

 

[Awesomandy]

Yep fundamental numbers look now, when price has fallen

Earnings and Dividends Forecast (cents per share)
2007 2008 2009 2010
EPS 63.9 76.5 92.5 106.1
DPS 44.0 44.0 46.5 52.0

EPS(c) PE Growth
Year Ending 30-06-08 76.5 10.0 19.7%
Year Ending 30-06-09 92.5 8.3 20.9%

Thanks

MS

Assuming the div forecast is spot on, it means we get around 5.6%, mostly franked. So, even if the sp stays at the same spot for years, it would still outperform a bank account. And, with a forward PE of around 10, and growth forecasted to be around 20%, it's a no-brainer, I think. This one is going into my core strategy.

 

[michael_selway]

Assuming the div forecast is spot on, it means we get around 5.6%, mostly franked. So, even if the sp stays at the same spot for years, it would still outperform a bank account. And, with a forward PE of around 10, and growth forecasted to be around 20%, it's a no-brainer, I think. This one is going into my core strategy.

Dude correct unless something bad happens all all those forward earnings are downgraded. At current prices, its "cheaper' than MBL, BNB etc

Another similar "good value" stock is MFS. Altough risk rise it may be higher/different

MFS - Earnings and Dividends Forecast (cents per share)
2007 2008 2009 2010
EPS 53.1 45.3 55.4 63.3
DPS 28.0 30.0 33.0 38.0

EPS(c) PE Growth
Year Ending 30-06-08 45.3 10.1 -14.7%
Year Ending 30-06-09 55.4 8.3 22.3%

thx

MS

 

[reece55]

Assuming the div forecast is spot on, it means we get around 5.6%, mostly franked. So, even if the sp stays at the same spot for years, it would still outperform a bank account. And, with a forward PE of around 10, and growth forecasted to be around 20%, it's a no-brainer, I think. This one is going into my core strategy.

Awesome,
I would submit it just isn't that easy mate, because otherwise don't you think every fund manager would be doing that?

As I said previously in my post, AFG is in a major downtrend, not uptrend. The reason - well, obviously our current crisis in the confidence with the whole financial sector, especially those connected with sophisticated finance. The one thing I will say is that when I worked for ADB, Mobius (a component of the AFG group) were investors in lower grade notes some of the off balance sheet trusts managed by ADB. Some of these are subordinated notes and whilst there weren't any impairment issues that I was aware of, to achieve such high interest margins (as previously discussed), one must be prepared to take on higher risk of the impairment of collateral. So, I would say there is still a lot more to come from AFG and 20% growth is not a reasonable assumption anymore.

Cheers
Reece

 

[Awesomandy]

20% growth is not a reasonable assumption anymore.

Yes, you are definitely correct. I do apologise for my previous post. Reading back on it now, it sounds like it's all blue sky, but as a matter of fact, the risks are actually quite high, and I should have mentioned that. Anyway, thank you for pointing them out again.

 

[golfmos123]

Just to add some more blue sky to the discussion.....don't forget, these guys were flying at 11 bucks not long ago with the Qantas deal in their back pockets. The Q deal goes pear shaped, AFG announce that it doesn't hurt them financially, and on the back of the subprime nervousness, the stock plummets down to 6-7 bucks.

To me, that is a market over-reaction. As has been posted recently, at around the 7 buck mark with good yield, this one should be a nice tidy earner (slow and steady wins the race remember...)

 

[Pager]

Anyone bought into them recently ?.

They are on my list to add as a long term holding and getting very close to my price to buy in, about the only thing that is remotly close .

They bought out the remaining stake in rubicon, have said they have no exposure to sub prime, the QAN buyout **** up didnt impact them financialy and they have close to a 6% yeild, why are they still getting hammered

 

[Julia]

Anyone bought into them recently ?.

They are on my list to add as a long term holding and getting very close to my price to buy in, about the only thing that is remotly close .

They bought out the remaining stake in rubicon, have said they have no exposure to sub prime, the QAN buyout **** up didnt impact them financialy and they have close to a 6% yeild, why are they still getting hammered

Pager, despite the assurance that they have no exposure to subprime, I sold mine after reading that they could in fact be affected in an indirect way.
I bought at around $4 so was happier taking my profit and running.

I think there's still some nervousness around AFG, not unlike the same feelings about MBL.

Until that settles out, there are other more stable companies making consistent growth.

 

[3 veiws of a secret]

Yes I bought in some 2 days ago ...in fact 2nd to last trade of the day.Have expressed glee at the price I bought in,but your quite correct it's not receiving favourable status for its recent purchase of Rubicon. I'm slightly concerned if it dropped to $7.00 ....I hold tightly for now!

 

[michael_selway]

Pager, despite the assurance that they have no exposure to subprime, I sold mine after reading that they could in fact be affected in an indirect way.
I bought at around $4 so was happier taking my profit and running.

I think there's still some nervousness around AFG, not unlike the same feelings about MBL.

Until that settles out, there are other more stable companies making consistent growth.

Unless you buy AFg "low" then it will be

Earnings and Dividends Forecast (cents per share)
2007 2008 2009 2010
EPS 63.9 78.6 94.4 106.4
DPS 44.0 44.0 49.0 53.0

thx

MS

 

[vishalt]

The prices you guys are getting these financial stocks at are pretty cheap prices, ofcourse after a drastic shock like that it'll take a while to regain confidence.

But the time to buy is when there's blood and panic on the streets!