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CCV - Cash Converters

Discussion in 'Stocks 0-H' started by Trader Paul, Jan 6, 2008.

  1. Rainman

    Rainman

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    Does anyone like this stock for its turnaround possibilities? I have taken a nibble now that the legal horizon has cleared somewhat.

    I hate its business but it looks cheap.
     
  2. Admiral Rimmer

    Admiral Rimmer

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    Given its current price, no lol

    Lot of uncertainty around how its transition to MACC will go. The legal issues should be behind them soon. It's more how much of Money 3's market are they going to be able to make profit in that worries me.

    I can't see them breaking through a 1.00 anytime soon that's for sure.
     
  3. Rainman

    Rainman

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    Let's check back in a year's time.

    CCV has provided guidance of $20 million to $23 million of NPAT for 2017. Its market cap is presently $170 million.

    MNY made $20.1 million in NPAT last year. It is guiding to $26 million in earnings for 2017. MNY has a present market cap of $261 million.

    Why do I want to spend $91 million more for at most $6 million more in earnings?
     
  4. Admiral Rimmer

    Admiral Rimmer

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    You could well be right. Only time will tell how they go meeting guidance.

    Market seemed to recently factor in legislative changes which wont take effect until 18 at the earliest, so potential in that I guess.
     
  5. WRiley

    WRiley

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    Keen here.
     
  6. The Triangle

    The Triangle

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    I'm in. I think this capital raising will significantly change the company. Bonds will be wiped off the map. That saves $5m a year in costs + the admin costs + renegotiating costs if they had decided to get new ones. It also leaves a massive cash balance intact which will surely be enough to cover the class action (which will hopefully be resolved in the next 6 months). Expect in 12 months time to see earnings 4+ cents per share range.
     
  7. The Triangle

    The Triangle

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    Has not been a very good performer. Frustrating when you see twenty trades today for 12 shares each... I've significantly increased my holding this week and look forward to the new CEO starting Monday. EBITDA looking ok pos adjustments and hopefully class action will be resolved before the end of the financial year (anyone know what to expect? $35 million is my guess?)
     
    Smurf1976 likes this.
  8. Zaxon

    Zaxon The voice of reason

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    It surprises me that with the belief that "payday loans" are ripping people off, how poorly CCV is doing operating in this space.
     
  9. sptrawler

    sptrawler

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    The problem is they can't sell stuff cheaper than you can buy new.
     
  10. Smurf1976

    Smurf1976

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    Yep. Everything is against that side of the business really.

    Value of new goods has dropped hugely thus limiting the potential markup on second hand items and also reducing the base of customers who want to buy second hand goods.

    Meanwhile the cost of doing business has steadily increased. Rent, wages, utilities etc.

    Plus the ability to advertise your own goods for sale to wide market at no cost online reduces the number of people who would consider selling their items to a second hand dealer.

    It's a perfect storm really, under attack on all fronts.

    To the extent there's an ongoing business here it's in the loans side of it all not the more traditional second hand goods business. :2twocents
     
  11. greggles

    greggles I'll be back!

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    A five year weekly chart best illustrates CCV's declining fortunes.

    Generally I agree with Smurf that Cash Converters is operating a business model that seems to have less relevance today than it ever has. If you want something second hand, get on Gumtree or eBay.

    Even the loans side isn't something I'd be betting on with Afterpay and other ways of paying things off in installments. Short term loans with extortionate interest rates is something I think we'll be seeing less of in the future as competition and innovation changes the short term credit landscape for good.

    It will be interesting to see where CCV does eventually bottom out.... if indeed it actually does.

    big.chart-CCV.gif
     
    Zaxon likes this.
  12. Smurf1976

    Smurf1976

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    I note with interest the current buy order for 7.5 million shares at 1.3 cents each (verus last traded price of 15 cents).

    Market depth can be yeah, whatever, but that's a bit extreme.

    Someone's actually expecting to have a chance of getting that order filled? Or something else going on?

    Do not hold, just noticed the large outstanding order and looked further into it. :confused:
     
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