Tom Winnifrith Bearcast: No I am not buying Red Rock or Open Orphan tomorrow or any Ben & Jerry's ice cream
San Leon Energy deals in Nigeria could come at just the right time to take advantage of higher oil prices and an easing of OPEC restrictions
You my recall that I sold my holding in the bus and rail company FirstGroup (FGP) about three months ago after it had announced that it was selling its US business at a decent - but not too exciting - price. It was certainly time to book a small profit and move on. A month or so later I was observing that a UK National Rail Contracts agreement may have also helped keep its day-to-day bus and rail business going, but its ability to make reasonable continuing profits over the next few years was pretty limited. Clearly that all continues as whilst it may be the so-called ‘Freedom Day’, life is a little bit different.
Did you see the big deal involving FirstGroup (FGP) - the bus and rain operator - whose shares are back to a level last seen in early March 2020 following their sale of two North American bus businesses (First Student and First Transit) to Swedish-based private equity group EQT Infrastructure for £3.3 billion? That is kind of interesting given here, back in September last year, the key was observing that ‘it is remarkable what a load of subsidies and a bit of cost control can do’ in terms of a share price that has doubled since.
Back in July I concluded about bus and train operator FirstGroup (FGP) that 'councils and governments appear supportive but shareholders always have to worry when a subsidy game is propping a company up materially'. Today's AGM trading update exhibits similar themes...but also slips in a surprise profit running ahead of expectations ('small adjusted operating profit for the seasonally weaker first half of the financial year') comment. Hello a near 10% share price rise (although not yet a return of the share price to levels seen throughout the second quarter). So what is going on?...
Rail and bus operator FirstGroup (FGP) may be surviving but it hardly is thriving. Personally, I have not been on a train for almost four months and - frankly - I cannot imagine jumping on one for at least another couple of months. Others will be more or less gung-ho but today's full year numbers nodded towards a similar theme. If you want to understand today's share price fall, then you have to start with 'travel volumes have reduced very substantially (still 75-90% in the UK rail and bus operations) and while guidance to limit travel and socially distance remains in place, this will have a significant impact on our service capacity and financial performance'...
Life has moved quickly in the last six weeks and that is particularly true at the bus and train operator FirstGroup (FGP) which back in early March I was excited about the potential for either the company's organic efforts to create value...or the company's big activist shareholder to force it.
It was good to see today's regulatory news story about FirstGroup (FGP) that the typically wise and always serious Competition and Markets Authority (CMA) opined that after an investigation into the 'award of the West Coast Rail franchise to a joint venture between FirstGroup and Trenitalia...the award of the franchise can now go ahead without a more in-depth Phase 2 investigation'...
Mr Market giving you a kicking now and again keeps you suitably humble. Back in August I self-congratulated HERE about how 'one of my better portfolio performers year-to-date has been FirstGroup (FGP) which I have loved up a number of times in the last eighteen odd months on these pages, ever since the bus and rail company was silly enough (admittedly under a different management team) to turn down a bid from private equity'. Well that was all fine and dandy with both an activist shareholder AND the company coming up with its own plans to create value by splitting the company up. However today's update has pushed the shares down 20% odd percent as I write. So what has gone wrong given the value creation plans continue apace and full year numbers were reconfirmed?...
Outside of some legendary gold plays, one of my better portfolio performers year-to-date has been FirstGroup (FGP) which I have loved up a number of times in the last eighteen odd months on these pages, ever since it was silly enough (admittedly under a different management team) to turn down a bid from private equity. In my previous update, I recounted how the new management team were actually starting to copy some of the suggestions offered by activist challenges. Now this is all good stuff...but it is even better when you win new contracts…
I thought Malcolm rather unfairly caught it over an article he wrote about FirstGroup (FGP) a few weeks ago as he highlighted something that has characterised my articles on the stock: there is value and change opportunity here...
Hello Share Takers. As a self-styled green investor, though hypocritically not all the time, I tend to favour public transport providers. FirstGroup (FGP) buses are a familiar sight on our roads and it also operates in the USA and Canada. Those famous Greyhound buses are in its stable...
The train operators certainly do make it easy to invest in them. I read in the business pages of one of the deadwood press publications today that 'a £2.6 billion standoff over pensions threatens to derail a string of train franchises' which could well hit hopes to award long-term franchises in some parts of the country including the West Coast mainline which I live close to. Another problem for that top performing politician Mr Grayling to deal with. Why is his name never mentioned as a future Prime Minister?
I am trying to think if I have ever been to ‘Madchester’ bus station. Whilst I ponder this, I can provide you with the news that FirstGroup (FGP) which apparently used to own it has sold it on for £11 million or so to another transport group Go-Ahead (GOG). How exciting. Much as I would like to talk about transport hubs of the north, there is a serious side to my preliminary waffle…
Something a little different today from all those worthy growth at a reasonable price type companies I normally ramble on about. Whisper it quietly, but I think that FirstGroup (FGP) is cheap here. I know that a transport company is never the most popular name - and I await the opprobrium from the TransPennine Express train and related users in the comments section - but hear me out, after all, got to be greedy when others are fearful and all that.
Search ShareProphets |
Recent Comments |