old_punter
19 Feb 2018
Smacked the bots Couldn't resisit it.At previous post 804p, having touched 824p. About half an hour later, bots taken price down in more tiny trades, so bought 2,500 shares at 783.6p at 1409, and guess what, the bots having been smacked turned upwards to 794p and now on the way down again at 787p. Could be due for another smack before long.
old_punter
19 Feb 2018
Smack the bots Please forgive the infantile humour.Looking at the trades today so far, caveat as reported here, they seem mostly small I would guess automated trades this time following upward momentum so the share price got to 824p and somebody dealt at 817p in 9,000 shares, the largest individual trade I saw. Now 804p.As I and some others on this board think, the shares seem to have some support at last, and this can be justified on the fundamentals, enough bad news discounted IMO.GLA
old_punter
18 Feb 2018
Re: Preparing for a slow death.... shareordie,I think you are right this will become a utility stock, so once settled down fairly predictable and safe. Always investors for steady eddie, inflation linked income stocks, and I think after the fall to this level there could be buying interest after the 2017 results which I am guessing may say trade in 2018 so far is not that bad but obviously too early to be sure how it will turn out over the year.Directors will then be able to buy and I expect them to do so. Therefore I favour buying at least some shares ahead of the announcement, have just added at 767p.
shareordie
17 Feb 2018
Re: Preparing for a slow death.... It looks to me like DTY will probably survive,but will it be a growth stock ?I would say probably not,it will probably have to work hard just to stand still.So that is one reason why the fall in price,this company was priced for strong reliable growth and it will not be able to do that now.Will results day show up any more bad news?That's a possibility.So I will wait for after results at least.Maybe this will turn into a low growth income stock,a bit like a utility.
old_punter
16 Feb 2018
Re: Preparing for a slow death.... stan,What you say chimes well with me, and I respect your 35 years of experience at this game, but FWLIW I reckon the CEO is a bright guy who has rightly been cautious and I think the covenants even on your numbers are unlikely to be breached. There is an additional covenant I think at 1.85 times EBITDA which would see the equity dividend go but nobody is in this stock for yield.We shall see what is said later in March when the 2017 results are reported and there will have to be some comment however vague or qualified about how trade has been so far in 2018. If there are no more negatives than already in the share price, I suspect the share could rerate somewhat after a major fall.ATB everyone.
the real stan
16 Feb 2018
Re: Preparing for a slow death.... Oh, I don’t have any special insight and my analysis is very broad. I’m not making any forecasts. I guess my point is over 35 years of investing I’ve seen this kind of train crash unfold many times before and it ALWAYS comes out worse than the first profit warning. I have no position short or long and before I take one will wait for at least two more profit warnings, change of management and Rights Issue. I hope you are right and if non of this bad stuff happens then great for all shareholders, I just see wishful thinking and not enough certainty to make me risk my cash.
Bigtex
16 Feb 2018
Re: Preparing for a slow death.... Hi Stan,I think you'll find that a 20% reduction to Funerals business is more like a £45Mill hit to EBITDA than your £60Mill. Even with Dignity's harsh assumptions about the mix and total Dignity funerals being lower this year vs last, 2018 EBITDA should still come in around £105Mill - and if they have been overly pessimistic on the Traditional funerals attrition rate, EBITDA could get to £115+Mill. I think the primary covenant requirement is not in jeopardy.
the real stan
15 Feb 2018
Preparing for a slow death.... The company keeps saying the "primary" financial covenant is 1.5 EBITDA debt service cover but this implies there might be other financial covenants. If this starts to implode any other covenants previously thought immaterial might suddenly bite.Anyway the debt service cost is £33m so EBITDA needs to exceed £49m.Based on the 2016 AR covenant ratio EBITDA was around £112m but that before the actions now contemplated. A price reduction of 25% on “Simple” funerals which are currently only 7% by number doesn't seem much of an issue but Simple Funerals are expected to increase to 20%. What if this adverse mix trend snowballs with large price reductions required across the board to bring pricing back into line with competitors? Suddenly earnings could look very different - 20% off revenues is a £60m hit to EBITDA and falls through to the bottom line and then swamped by £520m of net debt. Shareholders equity is already zero in the balance sheet...
the real stan
15 Feb 2018
Re: Interesting foresight How can you say the current price is a good entry point? The business model is broken and with further exposure of the price differential Dignity could suffer a triple wammy of adverse sentiment, falling sales values and inability to grow by acquisition. Big goodwill writeoffs will then hurt the P&L and balance sheet. I'm no shorter -that game has played out - but a big shakeout is needed to make this investible again.
old_punter
15 Feb 2018
Re: Deaths up in 2018 - 1st 5 weeks Interesting stats, can the Scotland 27% increase be right, anyway obviously helpful to DTY and the others in that dismal trade.The 2017 results statement in March must contain some hint or comment about trading to date in 2018, even if heavily qualified about being to early to tell etc, I would guess this is likely to be helpful to expectations about 2018 eps, which have been heavily talked down by the company and others, and the current share price of 780p.But WDIK, for disclosure I am partly long a bit lower than 780p and intend to add on any weakness.
shareordie
14 Feb 2018
Re: Oppenheimer Yes but if something has changed significantly from the initial reason to purchase then you have to review, maybe they feel that DTY will go lower when the results come in.Either way if DTY no longer fits there investment criteria then it's best to grasp the nettle.
Hardboy
14 Feb 2018
Oppenheimer Lost a bit of money on this - buying in to over 10%, then selling to below 3%. Not good business.
Bigtex
14 Feb 2018
Deaths up in 2018 - 1st 5 weeks Office for National Statistics has reported deaths registered in England & Wales for first 5 weeks of 2018 (up 7.1%) and National Records of Scotland has reported 5 weeks up 26.6% (the flu problem must be really bad up there) to give GB ytd increase of 8.8%.
Weildy
13 Feb 2018
Re: Interesting foresight Gamesinvestor. Thanks for posting that info from 'Beyond'. As you say, they appear to have been spot on with their analysis. It looks as if reality has kicked in and Dignity are getting their act together. I think that for long term investment, the current price is a now good entry point.
Hardboy
12 Feb 2018
Re: Interesting foresight The guy posted on these pages back in September, and soon got booted off iii. There are still some discussions in response to his original post, but not his original post. He obviously got it right and has presumably made a lot of money shorting DTY in the last 4-5 months.
