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Ah greed, what a wonderful thing...only problem is days/weeks like this make greed not so great.
AFG - Allco Finance Group
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Ah greed, what a wonderful thing...only problem is days/weeks like this make greed not so great.
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How sick is this puppy!
Last trade $2.55
Remember what a stella performance while under the Record Investments brand. What a difference a year makes...
the capitulation today is a worry, more so than 2 days ago. Obviously many in the market think it is finished.
So I gather, David Coe and one or 2 others have been margin called. Could explain some of the negative trading. The rest is blind fear by the looks of it. With MFS/CNP debacles front and centre, the fear of another is too much to cope with for some.
I hold AFG and will add at these levels. With confidence
I hold AFG and will add at these levels. With confidence
This is quite amazing.
There's not a single piece of solid evidence that can explain Allco's decline. I'm not saying there isn't risk involved in this share, there is. The company has been asked on numerous occasions if there is any valid reason why it's share price should have declined and on each occasion they have said "NO".
When asked what exposure AFG has to the US Sub-Prime markets they have said "very little". In fact, some of the Aussie Banks actually have more exposure to the Sub-Prime market than Allco.
Unfortunately, AFG has done it's self and it's share holders a massive disservice by not supplying the market with more evidence that their exposure is minimal and it is this uncertainty that has driven the fears of the Market.
If it turns out that Allco was, or is in trouble, surly their directors will be thrown in jail. I suspect that this is NOT the case as directors of the companies currently in trouble have already been forced to show their hand. This has NOT been the case with Allco Finance.
I'll be waiting with great anticipation for February 15.
There's not a single piece of solid evidence that can explain Allco's decline. I'm not saying there isn't risk involved in this share, there is. The company has been asked on numerous occasions if there is any valid reason why it's share price should have declined and on each occasion they have said "NO".
When asked what exposure AFG has to the US Sub-Prime markets they have said "very little". In fact, some of the Aussie Banks actually have more exposure to the Sub-Prime market than Allco.
Unfortunately, AFG has done it's self and it's share holders a massive disservice by not supplying the market with more evidence that their exposure is minimal and it is this uncertainty that has driven the fears of the Market.
If it turns out that Allco was, or is in trouble, surly their directors will be thrown in jail. I suspect that this is NOT the case as directors of the companies currently in trouble have already been forced to show their hand. This has NOT been the case with Allco Finance.
I'll be waiting with great anticipation for February 15.
I agree with you tronic, there is no information in their announcements which warrants this kind of hammering.
Either there is insider trading and the sellers know something we don't (they hit a subprime iceberg) or else it is shorters making a killing in the absence of buyers because of the twin effect of broader market rout and negative AFR articles this week. If it's the latter it should bounce back hard when the dust settles.
Hoping it's the latter. But I am only dabbling in it.
Either there is insider trading and the sellers know something we don't (they hit a subprime iceberg) or else it is shorters making a killing in the absence of buyers because of the twin effect of broader market rout and negative AFR articles this week. If it's the latter it should bounce back hard when the dust settles.
Hoping it's the latter. But I am only dabbling in it.
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tronic, your very astute in understanding the way mechanics of the allco future announcements will follow, and i have little doubt 15th february will answer your concerns. it may be a great share to be in at these levels imho..
michael_selway
Coal & Phosphate, thats it!
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hm might as well go back down to 50c!
Earnings and Dividends Forecast (cents per share)
2007 2008 2009 2010
EPS 63.9 71.9 82.3 92.8
DPS 44.0 44.0 48.0 51.0
thx
MS
Thanks for your replies Agentm & Broadside,
I've held AFG on and off for he last 6 months and have actually done well with it. I purchased early this morning (bad) and late this afternoon (good).
Before posting, I once again listened to the December meeting regarding the acquisition of Rubicon. It reminded me why I got into AFG in the first place. I urge anyone interested in AFG to listen to the recording of the meeting. It's available for their website. Some of the shareholders questions where the same questions both myself and others in the market had in regards to the acquisition of Rubicon. Having listened once more to the answers given, I'm still satisfied that the acquisition of Rubicon, although pricey, was a good move for the company.
Although many analysts claim the purchase price of Rubicon was high, it's important to note that there were caveats put in place that stipulated that if the Rubicon assets didn't perform, Allco wouldn't pay. This gave both parties a huge incentive to perform. AFG also already owned 20% of Rubicon so it also made sense in that respect. It should also be noted that many of the properties in both the AFG and Rubicon portfolio are extremely high quality, as are both their tenants and the long term leases they hold.
These guys aren't idiots. If they have a fault, it's their lack of Market transparency & shocking PR.
Interestingly, many of the research groups STILL have AFG as a buy, even after yesterdays crash! Most have down graded their earnings forecasts but there valuation of AFG is still high. Aspect Huntely for example, has a current buy recommendation with a price target of nearly $10, I quote
Huntley's Recommendation: Allco Finance Group Limited
"Our valuation is reduced to $9.65 to reflect a more conservative attitude toward risk."
Name one other share with a dividend of .44c, P/E ratio of 4.37 and a target price of nearly 500% it's current price.
It's also interesting to note that David Coe currently owns 6.7% of the company, surely as the ultimate insider, he of all people would have substantially reduced his holding if the company was doomed. 6.7% of nothing, is still nothing.
If the company ISN'T in the kind of trouble that the market "suspects", I suspect AFG will be one of the success stories of 2008. If it is in trouble, I'll be one of the first to organise a visit from "Bubba" when the directors are thrown in jail.
PS. This isn't ramping. These are just the facts as I see them. If there were facts to the contrary I'd be the first to list them (lack of transparency etc are examples).
I've held AFG on and off for he last 6 months and have actually done well with it. I purchased early this morning (bad) and late this afternoon (good).
Before posting, I once again listened to the December meeting regarding the acquisition of Rubicon. It reminded me why I got into AFG in the first place. I urge anyone interested in AFG to listen to the recording of the meeting. It's available for their website. Some of the shareholders questions where the same questions both myself and others in the market had in regards to the acquisition of Rubicon. Having listened once more to the answers given, I'm still satisfied that the acquisition of Rubicon, although pricey, was a good move for the company.
Although many analysts claim the purchase price of Rubicon was high, it's important to note that there were caveats put in place that stipulated that if the Rubicon assets didn't perform, Allco wouldn't pay. This gave both parties a huge incentive to perform. AFG also already owned 20% of Rubicon so it also made sense in that respect. It should also be noted that many of the properties in both the AFG and Rubicon portfolio are extremely high quality, as are both their tenants and the long term leases they hold.
These guys aren't idiots. If they have a fault, it's their lack of Market transparency & shocking PR.
Interestingly, many of the research groups STILL have AFG as a buy, even after yesterdays crash! Most have down graded their earnings forecasts but there valuation of AFG is still high. Aspect Huntely for example, has a current buy recommendation with a price target of nearly $10, I quote
Huntley's Recommendation: Allco Finance Group Limited
"Our valuation is reduced to $9.65 to reflect a more conservative attitude toward risk."
Name one other share with a dividend of .44c, P/E ratio of 4.37 and a target price of nearly 500% it's current price.
It's also interesting to note that David Coe currently owns 6.7% of the company, surely as the ultimate insider, he of all people would have substantially reduced his holding if the company was doomed. 6.7% of nothing, is still nothing.
If the company ISN'T in the kind of trouble that the market "suspects", I suspect AFG will be one of the success stories of 2008. If it is in trouble, I'll be one of the first to organise a visit from "Bubba" when the directors are thrown in jail.
PS. This isn't ramping. These are just the facts as I see them. If there were facts to the contrary I'd be the first to list them (lack of transparency etc are examples).
Garpal Gumnut
Ross Island Hotel
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Thanks for your replies Agentm & Broadside,
I've held AFG on and off for he last 6 months and have actually done well with it. I purchased early this morning (bad) and late this afternoon (good).
Before posting, I once again listened to the December meeting regarding the acquisition of Rubicon. It reminded me why I got into AFG in the first place. I urge anyone interested in AFG to listen to the recording of the meeting. It's available for their website. Some of the shareholders questions where the same questions both myself and others in the market had in regards to the acquisition of Rubicon. Having listened once more to the answers given, I'm still satisfied that the acquisition of Rubicon, although pricey, was a good move for the company.
Although many analysts claim the purchase price of Rubicon was high, it's important to note that there were caveats put in place that stipulated that if the Rubicon assets didn't perform, Allco wouldn't pay. This gave both parties a huge incentive to perform. AFG also already owned 20% of Rubicon so it also made sense in that respect. It should also be noted that many of the properties in both the AFG and Rubicon portfolio are extremely high quality, as are both their tenants and the long term leases they hold.
These guys aren't idiots. If they have a fault, it's their lack of Market transparency & shocking PR.
Interestingly, many of the research groups STILL have AFG as a buy, even after yesterdays crash! Most have down graded their earnings forecasts but there valuation of AFG is still high. Aspect Huntely for example, has a current buy recommendation with a price target of nearly $10, I quote
Huntley's Recommendation: Allco Finance Group Limited
"Our valuation is reduced to $9.65 to reflect a more conservative attitude toward risk."
Name one other share with a dividend of .44c, P/E ratio of 4.37 and a target price of nearly 500% it's current price.
It's also interesting to note that David Coe currently owns 6.7% of the company, surely as the ultimate insider, he of all people would have substantially reduced his holding if the company was doomed. 6.7% of nothing, is still nothing.
If the company ISN'T in the kind of trouble that the market "suspects", I suspect AFG will be one of the success stories of 2008. If it is in trouble, I'll be one of the first to organise a visit from "Bubba" when the directors are thrown in jail.
PS. This isn't ramping. These are just the facts as I see them. If there were facts to the contrary I'd be the first to list them (lack of transparency etc are examples).
I don't hold AFG but have followed their price via my charts.
In spite of yours and aspect Huntley's optimism , a stock is worth the highest price the next bloke will pay you for it.
As of my 5.30 pm today data this was $2.21
Its a bit like a banana grower telling you bananas are woth $12.50 a kilo when they are selling at a market for $2.21 a kilo. and in plentiful supply. That is their price and that is their worth at that time. they may be cheaper the following day.
This chart reminds me of HIH as it fell, and stabilised, and fell again, and again, until it went bust.
I would beware of buying this stock on dips. It may keep on going down.
A daily chart is enclosed. What it says is that there are more sellers than buyers, driving the price down.
Note that the volume increases when the price goes down, and drops on recovery from "dips".
gg
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Forced sellers guys.
Note the announcement tonight concerning the related party having a monster margin call and being forced sellers of 20m shares.
Nothing to do with fundamentals or the chart.
Trading tomorrow will be interesting...
Note the announcement tonight concerning the related party having a monster margin call and being forced sellers of 20m shares.
Nothing to do with fundamentals or the chart.
Trading tomorrow will be interesting...
If the dividend remains at 48 cents then the stock is going to pay for itself in only a short time.
I think its worth getting 2-3% of your total port folio dedicated to a stock like AFG. If it does go bust then your losses are not substantial, if it is a success then your rewards could be great, with an ongoing dividend.
Looking back at MQG I am sure they were in the same trouble early on.
Either way a lot of money is going to be made and lost on this stock.
If AFG is around in 12 months it could be an amazing ride.
I think its worth getting 2-3% of your total port folio dedicated to a stock like AFG. If it does go bust then your losses are not substantial, if it is a success then your rewards could be great, with an ongoing dividend.
Looking back at MQG I am sure they were in the same trouble early on.
Either way a lot of money is going to be made and lost on this stock.
If AFG is around in 12 months it could be an amazing ride.
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True BSD, it will be very interesting.....
But only today did the APT actually sell their shares, all other selling prior to today has been market driven.....
Whilst I do think they have problems, the 1.70 low appeared overdone to me unless they are bankrupt....... Amazing what a turn in sentiment can do, I sold out after they announced they would be buying the largest stake in the Qantas buy out that failed..... my 12.90 sale is looking o so sweet.............
Imagine how the employees and senior management are feeling now.... their margin call means they have sold out at what could potentially be a market bottom, giving up a significant portion of the Company dirt cheap.... very sad...
Cheers
Allco staff fund at root of company shares crash
Scott Rochfort and Stuart Washington, Sydney-The Age
January 24, 2008
THE crisis of confidence surrounding Allco Finance Group has grown into full-blown panic, when a fund believed to be largely owned by the group's senior employees contributed to the company's demise by being forced to dump Allco shares at fire-sale prices.
A single trade of 10 million Allco shares at $3 each yesterday morning further pushed down the share price in a company already under siege, as it emerged that the fund was being forced to dump stock in Allco after being margin-called by two of its four lenders.
Making matters worse, the Allco Principals Trust (API) is the company's largest shareholder.
Allco shares dived 43% to a new low of $1.70, before recovering to close 78 ¢ lower at $2.21, as the company left its investors in the dark until after the close of trade.
Shares in the company have now fallen more than 60% since the start of the month.
It was only after 6pm that Allco released a letter it received from Allco Principals Trust, which is believed to count Allco executive chairman David Coe as a key shareholder.
Allco chief executive David Clarke would say only that the fund's stakeholders included some "long-standing Allco employees" and senior executives.
Mr Clarke said he was not an API shareholder.
Mr Coe declined to comment on his interest in API. "I'd never comment on any shareholder matters," he told BusinessDay. "I divorce any single shareholder issue from the business."
API said it had been forced to sell 22.1 million shares, or 6%, of the group and a further stake in the listed Allco HIT, citing "extreme market volatility".
Adding to the concern, the distressed API is managed by Allco's Managed Investment arm and still remains the group's largest single shareholder, with a remaining 26.7 million shares.
"API is currently in constructive discussions with the remaining two margin lenders with a view to completing a standstill agreement between API and those lenders to ensure that, given the current market volatility, no further stock is sold," the letter said.
Mr Clarke expressed hope the company would prove that its current share price, which is down 60%, is unjustified when it releases its results next month.
"We're confident that when we publicly announce our results on the 15th of February the broad market will understand that the business continues to perform well."
He said that the API sale did not breach laws forbidding directors or executives selling stock in the "blackout" period leading to company's profit result announcements. This was because it was not managed by the directors.
Mr Coe dismissed talk his company could struggle to pay its debts.
"Most of the assets that you find in our main areas, they are all very long-term assets and we have no problem securing long-term debt for them."
As for the share slump. "There's no empirical or fundamental reason for it."
Scott Rochfort and Stuart Washington, Sydney-The Age
January 24, 2008
THE crisis of confidence surrounding Allco Finance Group has grown into full-blown panic, when a fund believed to be largely owned by the group's senior employees contributed to the company's demise by being forced to dump Allco shares at fire-sale prices.
A single trade of 10 million Allco shares at $3 each yesterday morning further pushed down the share price in a company already under siege, as it emerged that the fund was being forced to dump stock in Allco after being margin-called by two of its four lenders.
Making matters worse, the Allco Principals Trust (API) is the company's largest shareholder.
Allco shares dived 43% to a new low of $1.70, before recovering to close 78 ¢ lower at $2.21, as the company left its investors in the dark until after the close of trade.
Shares in the company have now fallen more than 60% since the start of the month.
It was only after 6pm that Allco released a letter it received from Allco Principals Trust, which is believed to count Allco executive chairman David Coe as a key shareholder.
Allco chief executive David Clarke would say only that the fund's stakeholders included some "long-standing Allco employees" and senior executives.
Mr Clarke said he was not an API shareholder.
Mr Coe declined to comment on his interest in API. "I'd never comment on any shareholder matters," he told BusinessDay. "I divorce any single shareholder issue from the business."
API said it had been forced to sell 22.1 million shares, or 6%, of the group and a further stake in the listed Allco HIT, citing "extreme market volatility".
Adding to the concern, the distressed API is managed by Allco's Managed Investment arm and still remains the group's largest single shareholder, with a remaining 26.7 million shares.
"API is currently in constructive discussions with the remaining two margin lenders with a view to completing a standstill agreement between API and those lenders to ensure that, given the current market volatility, no further stock is sold," the letter said.
Mr Clarke expressed hope the company would prove that its current share price, which is down 60%, is unjustified when it releases its results next month.
"We're confident that when we publicly announce our results on the 15th of February the broad market will understand that the business continues to perform well."
He said that the API sale did not breach laws forbidding directors or executives selling stock in the "blackout" period leading to company's profit result announcements. This was because it was not managed by the directors.
Mr Coe dismissed talk his company could struggle to pay its debts.
"Most of the assets that you find in our main areas, they are all very long-term assets and we have no problem securing long-term debt for them."
As for the share slump. "There's no empirical or fundamental reason for it."
GreatPig
Pigs In Space
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Yeah, pretty amazing.
I held this for nearly a year from mid-2005 to mid-2006, and it must be close to the stock I've ever made the most money from.
GP
I dont think David Coe would have let his stock go to unfriendly parties.
The hedge funds who shorted this stock have been wanting this scenario to unfold for a month or two. Unfortunately, due to the market enviroment, these hedge funds have been able to collapse the stock on relatively little volume and thus create this scenario. What might be worrying them now though, is that in order to close their positions out and lock in their profit, they needed to be the buyers of the margin sold stock.
I don't think they were the buyers of this stock.
If AFG come ou with the profit result/outlook and dividend statement I think they will, then these hedge funds could very well find themselves in "short squeeze land".
I belive we could well have a very significant rebound.
In their announcment yesterday, they effectively said that profits will be good, and given that they have no real debt financing issues, the fundementals of this business still remain.
Look out above
The hedge funds who shorted this stock have been wanting this scenario to unfold for a month or two. Unfortunately, due to the market enviroment, these hedge funds have been able to collapse the stock on relatively little volume and thus create this scenario. What might be worrying them now though, is that in order to close their positions out and lock in their profit, they needed to be the buyers of the margin sold stock.
I don't think they were the buyers of this stock.
If AFG come ou with the profit result/outlook and dividend statement I think they will, then these hedge funds could very well find themselves in "short squeeze land".
I belive we could well have a very significant rebound.
In their announcment yesterday, they effectively said that profits will be good, and given that they have no real debt financing issues, the fundementals of this business still remain.
Look out above
Bolivia: I dont think David Coe would have let his stock go to unfriendly parties.
The hedge funds who shorted this stock have been wanting this scenario to unfold for a month or two. Unfortunately, due to the market enviroment, these hedge funds have been able to collapse the stock on relatively little volume and thus create this scenario. What might be worrying them now though, is that in order to close their positions out and lock in their profit, they needed to be the buyers of the margin sold stock.
I don't think they were the buyers of this stock.
If AFG come ou with the profit result/outlook and dividend statement I think they will, then these hedge funds could very well find themselves in "short squeeze land".
I belive we could well have a very significant rebound.
......40% and counting
The hedge funds who shorted this stock have been wanting this scenario to unfold for a month or two. Unfortunately, due to the market enviroment, these hedge funds have been able to collapse the stock on relatively little volume and thus create this scenario. What might be worrying them now though, is that in order to close their positions out and lock in their profit, they needed to be the buyers of the margin sold stock.
I don't think they were the buyers of this stock.
If AFG come ou with the profit result/outlook and dividend statement I think they will, then these hedge funds could very well find themselves in "short squeeze land".
I belive we could well have a very significant rebound.
......40% and counting
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BT margin lending have removed the lending ratio from AFG, not just for new purchases but for existing holdings.
Have all margin lenders done this?
Have all margin lenders done this?
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Any investor still in Allco needs to take a good look at their announcement today.
Their structure (which is increasingly being required to be disclosed to the market) is rapidly unwinding.......
If I get time, I will do a quick digram to illustrate all the no no's these guys have being doing since Coe et al vended the Allco side into Record. Reminds of a lighter version of what Enron was doing before they went belly up...
Key point - using your own companies shares as collateral, no matter what interposed structure you deam up, is not a good strcture to employ! No wonder the hedge funds are having a ball, they know this game all to well.
Cheers
Their structure (which is increasingly being required to be disclosed to the market) is rapidly unwinding.......
If I get time, I will do a quick digram to illustrate all the no no's these guys have being doing since Coe et al vended the Allco side into Record. Reminds of a lighter version of what Enron was doing before they went belly up...
Key point - using your own companies shares as collateral, no matter what interposed structure you deam up, is not a good strcture to employ! No wonder the hedge funds are having a ball, they know this game all to well.
Cheers
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