Hardboy
02 Aug 2016
Re: Interims It was up most of the day, but ended the day down, so I guess I'll admit to getting today's movement wrong. It still seemed to me a very bullish release. I t will be interesting to see what the brokers say tomorrow.
Hardboy
02 Aug 2016
Interims The Interims seem very upbeat. Business is going well. The UK New Car Market is still growing. They have noticed no effects from Brexit. All areas of the business are growing. If the full year grows at the same rate as the Interim the current PE (at last night's closing price) is under 6. Book value is 85% of the market value. The yield (if the final dividend increases at the same rate as the interim) is potentially 4.5%. This points to a very undervalued share.Personally I'm not keen on share buybacks when the company still has debts, but the net debt is low and nicely reduced. The only negative I saw was the increase in Pension Deficit.And this bit intrigued me: "we do not anticipate any material effect on new vehicle pricing as a result of exchange rates." - How can that be when they are importing cars and the £ is 10% weaker? Still we have to believe them, so that's great news. I'm still sure there will be some negative affects from Brexit - imported cars must begin to cost more. Companies will delay investment, so the fleet cars should be affected; and if there is a recession people will put of car purchases. But at the moment everything looks pretty good, so let's enjoy (here's the kiss of death) the share price rise today.
Yee Wo
02 Jul 2016
Re: Brexit "A lot of Japanese cars are made in the UK (but wouldn't had we not been in the EU) so maybe there will not be too much change in buying Toyota Honda & Nissan; other cars as you say could become more expensive."The UK based Japanese manufacturers are still plugged into Global Supply chains which provide components and raw materials as well as take their finished exports. At OEM level I would maintain all this is a very tough call. I have never owned PDG as it is a UK only business. I have held Inchcape for many years which, IMHO, is far and away the most robust dealership to robustly cope with a Brexit-type event as it is trading in 20+ different markets.
Hardboy
28 Jun 2016
Re: Brexit All excellent points. Pendragon makes more money from used and after sales than new car sales, so these should not be too affected. The € is being affected by Brext as well as the £ so the weak pound may not affect import of French, German & Italian cars too much. A lot of Japanese cars are made in the UK (but wouldn't had we not been in the EU) so maybe there will not be too much change in buying Toyota Honda & Nissan; other cars as you say could become more expensive.
TX2
28 Jun 2016
Re: Brexit The present share here price probably discounts potential bad news.However I think whilst possible post Brexit duty is a negative(say 3% duty);price increases caused by lower £ are a larger one,perhaps 10%.Have a slight query as to the continued availability of mega cheap finance/lease deals which have fuelled growth.Whilst second hand sales & servicing should not be directly affected by above;you need good new sales to help provide second hand stock,although part of this comes via company car sales.I am not a shareholder here presently;but am in another car sales business Caffyns to which the same thoughts apply.
Hardboy
27 Jun 2016
Brexit A Brexit vote was always going to be bad for this share. with uncertainty about trade tariffs on foreign cars; but I don't think their business should be affected too much - 2nd hand car market & aftersales markets should still be strong. And this is a well run outfit. Anyway I sold my holdings first thing Friday morning (thank goodness for automated electronic trading and a decent platform at iii (on Hargreaves Lansdown it took over 50 minutes for an automated trade to be triggered.) and have just bought back in. I've got 10% more shares and pocketed a small profit. I suspect I've got in too early and the price will weaken further, but I'm not unhappy with the way this has worked on this share at least.
RAConnell
29 Apr 2016
From today's Times Buying shares in a car dealership doesn’t sound like a plan for the steady-as-she goes investor, but there is a case to be made. Pendragon is a well-run outfit with a solid dividend that is well covered by cashflow and unlikely to be biffed by the company’s relatively small debts of about £80 million, less than one year’s profits.The shares are well down on the 49p reached in January. They closed at 34p last night, which leaves them yielding a solid, if not racy, 4 per cent, and the company’s market value at £494 million.Trevor Finn, the chief executive who turned Pendragon from an Arthur Daley-style shop into a proper business, is a straightforward chap. For a car dealer, anyway.Like many in the sector, he has been predicting that the extraordinary rise in new car sales has got to end soon. It hasn’t yet, as the young and upwardly mobile decide that leasing a car is much like leasing a phone — you pay a monthly fee, treat the product as you wish, and go for an upgrade in two years’ time.With interest rates low, why would you save up to buy anything?If you think this smacks of reckless consumerism, of debt-fuelled lifestyles lived beyond people’s actual means, then you are plainly a fuddy-duddy who keeps his change in a jar on the mantelpiece.Mr Finn insists that Pendragon is not that exposed to the new car market in any case. Used-car sales are a bigger part of the operation, and the servicing arm is growing.All cars of any age come back for fixing. And the more new cars that are sold, even if not by Pendragon, the more second-hand cars there will be in the future needing attention.Visits to its websites are rising and profit before tax was up 8.7 per cent in the first quarter, way better than the City expected.The company is opening stores in new territories, including Bristol, Norwich and Peterborough. It plans to add 40 new locations over the next five years, which shows it believes that there is growth to come.Competition in car websites is intense but the company’s offerings are among the best.Perhaps the message is this: if you are confident enough in the state of the economy and your own finances to think of buying a new car, why not buy some Pendragon shares too.My advice Buy a fewWhy Britain loves cars and for as long as interest rates remain low, the lease model looks set to be a winner
Hardboy
28 Apr 2016
IMS I thought today's update was positive. So I'm disappointed to see weakness rather than strength.
Hardboy
20 Apr 2016
Mitsubishi Is today's drop related to the breaking news that Mitsubishi have falsified some of their emission data? The news I heard said it was only related to cars sold in Japan; but that could be the tip of the iceberg.
II Editor
04 Aug 2015
NEW ARTICLE: Forecast-beating Pendragon remains bullish "Car dealers have profited since the financial crash from a combination of government help, cheap financing and economic recovery. Low interest rates mean drivers have more to spend on new motors, which explains why £600 million LSE
DGendragon ..."[link]
mcescher
29 Jul 2015
Analysis of PDG With a PE of 14x, what are peoples opinions on whether PDG is good value? I've been researching on here DG" target="blank" rel="nofollow">[link]
II Editor
17 Jul 2015
NEW ARTICLE: Car dealers fuelled for further upside "In a sign that Britain's economic recovery is helping people's wallets, turnover in the UK motor industry hit a record £69.5 billion in 2014. But there is a much tastier investment case than the sale of new cars in this cyclical sector, one that ..."[link]
Swearword
02 Jun 2015
big trades Massive vol - 8m shares sold in 4 trades reported - hardly budged the price. Also accounted for most of today's volume. Odd that had so little impact. I suppose suggests a substantial buyer at this level.
