Hits: 4

21 April 2020

City Of London Inv. Group – Trading Update

Share Price 327p

Mkt Cap £87m

Conflict Disclosure: No Holding

 

  • Update Modest net outflows of 0.6%. AUM down 27% over 3 months to March.

 

  • Valuation PE 8.4X Yield 8.9%

 

  • Conclusion The AUM have fallen particularly heavily as investment trust discounts widened during March as asset values fell. The shares are down 38% since February. This may well be the time to buy these for a recovery.

1 November 2019

Image result for banker emoji

City of London Group Plc – Bank License

Share Price 135p

Mkt Cap £54m

Conflict Disclosure: No Holding

  • Recognise Financial Services has submitted it bank license application.  Once authorised the companies’ lending activities will be consolidated within Recognise and new equity finance will be raised.
  • Estimates There appear to be no forecasts while last year to March 19 the company lost £3.6m after absorbing £1.7m of bank license application costs. The loss was delivered by the equity release provider, Milton Homes, which is running off its book and generating cash of £2-£3m pa. Asset finance , Bridging and the intermediary delivered a £342k contribution last year.
  • Valuation. The NAV is 83p/share. The valuation should perhaps be viewed by discounting the 2024 targets which involve loans of £1.1bn, a cost income ratio of 36.5% and PBT of £30m. The company will require new equity to achieve that.
  • Conclusion Investors will perhaps wait for the equity raise, which may yet be 6 months away, but that may well be at a level above the current share price.