CCV - Cash Converters

[Ohgr]

I think CCV is still worth holding. In the short term it will probably get hammered but I think in the long run they will recover.

The legislation is definitely a concern, but it still hasn't passed and it could change before it does get passed.

You could also argue that the legislation could end up inviting more people to get small loans because it's cheaper.

I'm holding onto this one simply because:

1) the business model is good and seems to be really hitting its stride in the UK (check the lastest results for UK)
2) I just purchased some recently at .50 cents so if the dividend holds up I'm getting around 7-8% dividend.
3) CCV isn't the type of company that will sit around and let things steam roll them, they will either find loopholes or will offer different services or expand more aggressively in the UK.
4) if the legislation is passed it won't come into effect until the earliest of July 2012, so that's still a year of CCV earning an insane amount of interest and fees.

The reasons to hold are too strong for me to give up selling right now, not to mention they have a pretty nice balance sheet that a lot of companies would kill for right now.

CCV is a little bit of a risky stock right now but sometimes you need to take the risks to get the great returns. I'm holding and if the boat goes down I'll go with it haha. I just wish I had more money so I could buy it at 40 cents.

 

[notting]

Bounced hard off it's lows and is at .475. If I had it, I'd be taking a loss about here.
Look at getting back in a little later on down the track. May not be smart but I'd be comfortable with that.

 

[xenith69]

Certainly concerning but i too am holding!
My avg price is 58.5c so divvy not too bad
goodluck
SP holding up considering i predicted a close of around 36c

 

[robusta]

Maybe the growth will just shift to the UK. A new store every 9 days seems like reasonable growth to me.

http://www.express.co.uk/posts/view/280675/Cash-Converters-growing-as-it-cashes-in-on-downturn

 

[notting]

Sounds unbelievable.
Competing at the bottom end is much easier than competing at the top it seems!
Great story pity its a shark fest.

 

[Mr Editor]

Great write-up on CCV's UK operations:

http://www.thisismoney.co.uk/money/...k-happy-profit-hard-up.html?ito=feeds-newsxml

Not my article, though, so please do your own research.

 

[Huskar]

Any thoughts as to why Cash Converters was up 10% yesterday? I tried to find any news but couldn't. And 10% isn't exactly mere market noise..

 

[bigdog]

06/12/2011 10:47 asx Parliamentary Joint Committee Recommendations
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01250207

Parliamentary Joint Committee Recommendations Cash Converters International Limited ("CCV") welcomes the recommendations made by the Parliamentary Joint Committee on Corporations and Financial Services in its report on the phase II reforms proposed by the Government as set out in the CONSUMER CREDIT AND CORPORATIONS LEGISLATION (ENHANCEMENTS) BILL 2011.

Following representations from CCV, its customers and other industry executives, the Committee, in its report released on the Friday 2ndDecember, 2011, analysed a wide range of matters pertaining to the Bill. Of the greatest relevance to CCV is the Committee's finding concerning short term small amount credit contracts as set out in the CCV announcement on 25 August 2011.

The Committee has concluded that the proposed fee caps comprising a 10% establishment fee and a 2% monthly fee are unworkable. The Committee said: "In this regard, it does not appear that an appropriate balance has been struck between consumer protection and industry viability." The Committee has recommended that the Government revisit key aspects of its reform package with further industry consultation.

CCV looks forward to working with the Government and industry representatives to achieve solutions which do achieve the right balance.

Managing Director Peter Cumins said: "We encourage the Government to amend its
proposed regulation of the sector in line with the Committee's recommendations. The
Company has always welcomed regulation that protects vulnerable and disadvantaged
Australians. The Committee's thorough examination of the issues and its clear
recommendations, gives rise to hope that a sensible outcome can be achieved which
preserves a viable industry and maintains access to short term loans for all those Australians who need this form of finance".

Ralph Groom Company Secretary 6 December 2011

1697

 

[suhm]

Seems like a leaky government ship, if the status quo prevails would be a good buy.

 

[zac]

So its quite apparent now that the 10% surge yesterday was Insider Trading.

 

[puppyboy]

06/12/2011 10:47 asx Parliamentary Joint Committee Recommendations
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01250207

Parliamentary Joint Committee Recommendations Cash Converters International Limited ("CCV") welcomes the recommendations made by the Parliamentary Joint Committee on Corporations and Financial Services in its report on the phase II reforms proposed by the Government as set out in the CONSUMER CREDIT AND CORPORATIONS LEGISLATION (ENHANCEMENTS) BILL 2011.

Following representations from CCV, its customers and other industry executives, the Committee, in its report released on the Friday 2ndDecember, 2011, analysed a wide range of matters pertaining to the Bill. Of the greatest relevance to CCV is the Committee's finding concerning short term small amount credit contracts as set out in the CCV announcement on 25 August 2011.

The Committee has concluded that the proposed fee caps comprising a 10% establishment fee and a 2% monthly fee are unworkable. The Committee said: "In this regard, it does not appear that an appropriate balance has been struck between consumer protection and industry viability." The Committee has recommended that the Government revisit key aspects of its reform package with further industry consultation.

CCV looks forward to working with the Government and industry representatives to achieve solutions which do achieve the right balance.

Managing Director Peter Cumins said: "We encourage the Government to amend its
proposed regulation of the sector in line with the Committee's recommendations. The
Company has always welcomed regulation that protects vulnerable and disadvantaged
Australians. The Committee's thorough examination of the issues and its clear
recommendations, gives rise to hope that a sensible outcome can be achieved which
preserves a viable industry and maintains access to short term loans for all those Australians who need this form of finance".

Ralph Groom Company Secretary 6 December 2011

1697

Last week proposed changes to the legislation in the UK got the same result....Whilst there is still a degree of uncertainty as to what the final outcome will be it appears a watered down version will be the outcome.....will be interesting to see if EZ come back for another bite now !!

 

[skc]

Seems like a leaky government ship, if the status quo prevails would be a good buy.

I saw the headline yesterday - sorry can't remember where - so the 10% jump was a reaction, not a leak. CCV released their own statement about the news today.

Probably a good buy but unsure if it will go all the way back with regulatory uncertainty still hanging around. Worth a swing trade if the market holds up imo.

 

[notting]

And worth a bucket load if it goes down with the market, if the market goes down IMO.

 

[McCoy Pauley]

Seems like a leaky government ship, if the status quo prevails would be a good buy.

So its quite apparent now that the 10% surge yesterday was Insider Trading.

The Committee's report was widely known. I read about it in the AFR last week. I don't see how it could be insider trading.

 

[suhm]

The Committee's report was widely known. I read about it in the AFR last week. I don't see how it could be insider trading.

Was it? I thought there was an article about CCV but I thought that was just detailing that it was going to the committee and reviewing the pay caps. I didn't think it detailed the findings of the committee's report, I only saw that the day after price rise with CCV's asx release and associated press releases.

Could be wrong of course and appear to be.

 

[skc]

Was it? I thought there was an article about CCV but I thought that was just detailing that it was going to the committee and reviewing the pay caps. I didn't think it detailed the findings of the committee's report, I only saw that the day after price rise with CCV's asx release and associated press releases.

Could be wrong of course and appear to be.

Review completed 2 Dec (last Friday) and the share price rose 10% on Monday. Seems to be in order...

http://www.aph.gov.au/senate/committee/corporations_ctte/Consumer_Credit_Corporations_2011/info.htm

 

[ROE]

This announcement is very bullish for CCV..

1. It gave CCV plenty of time to prepare and de-risk Australian Operations and expanding oversea so when and if these law comes in it has less impact.
It open a lot of stores in UK recently

2. The longer this goes on, labor could lose the next election and that may be the end of this legislation...

3. I'm expecting EPS around 8c this year with 4c dividend

without regulation risk this is a $1 stock and at this price a lot of bad things has factor in for CCV

up another 10% today ....

 

[notting]

2. The longer this goes on, labor could lose the next election and that may be the end of this legislation...

Just noting that it is actually a Bob Brown inspired legislation!

 

[suhm]

Review completed 2 Dec (last Friday) and the share price rose 10% on Monday. Seems to be in order...

http://www.aph.gov.au/senate/committee/corporations_ctte/Consumer_Credit_Corporations_2011/info.htm

http://www.aph.gov.au/senate/commit...er_Credit_Corporations_2011/report/report.pdf

Looks like it was released on the 3/12/11, would have been nice if CCV made a comment given the effect that it had on its SP and I thought it should be and the market seemed to think it was price sensitive. ASX seem to disagree though given there was no price sensitive tag against it.

Good on those who were more observant than I was, a very safe entry point at the open for the people who bought 0.47 vs 0.57 now. Small volume though so I don't feel that bad about missing it, not like the whole market knew about it except for me.

I'd prefer for the legislation to be passed rather than just have the reccomendations from the committee before entering but with a greens member and 5 labour members of the 10 committee members you would think it had a good chance of passing, or status quo prevailing.

 

[skc]

http://www.aph.gov.au/senate/commit...er_Credit_Corporations_2011/report/report.pdf

Looks like it was released on the 3/12/11, would have been nice if CCV made a comment given the effect that it had on its SP and I thought it should be and the market seemed to think it was price sensitive. ASX seem to disagree though given there was no price sensitive tag against it.

Good on those who were more observant than I was, a very safe entry point at the open for the people who bought 0.47 vs 0.57 now. Small volume though so I don't feel that bad about missing it, not like the whole market knew about it except for me.

I'd prefer for the legislation to be passed rather than just have the reccomendations from the committee before entering but with a greens member and 5 labour members of the 10 committee members you would think it had a good chance of passing, or status quo prevailing.

I remember some time Monday I wanted to keep CCV on close watch. But I do way too much reading in the morning and I completely forgotten about it. There's my small xmas bonus running away from me...