3IN investment company all set for a turnaround with a 21.03% dividend to start with

6th Mar '18 by lightningtiger

8 comments 5002 reads

Currently Rank 77 momentum 94 with 2 brokers showing a strong Buy rating. XD is coming up on 15/3/18 & paid @ 41.4p /share on 29/3/18. Details @ dividenddata.com, as is is not yet shown on Stockopedia yet but it does show EPS growth @ 147.9%.
Net profit last year £146.3M, with estimated profit of £363.2M for 2018, which, if estimates are correct, will certainly turn the company round.Operating margin is an extremely healthy 81.4%.
They are adding another £125M into infinis.

This fits Josef Lakonisok momentum screen.

I was considering Direct Line with a 7% dividend, but the margin put me off a bit compared with the potential share price increase that could come from 3IN.

At least it boosts the dividend income of my portfolio up another notch or too.

Fib retracement is also in excess of 220p & is off the chart.

Unlock with Email

Unlock with Google

Already have an account?
Login here

robin66

6th Mar '18

Lightning tiger I think you are misunderstanding the situation with3IN. Once the special divi of 41.4p is paid the NAV will reduce by that amount (latest NAV on 31/1/18 was 199p) and all things being equal the SP will fall by 41.4p which is why they have proposed a 15 for 19 share consolidation (see RNS dated 21/2/18) which will leave the SP unchanged so although you will receive the divi you will be left with less shares at a similar price to now. So the special divi will not in itself improve your total return (capital growth + divi) in the short term. Having said that I think 3IN is a good long term investment and I do hold the shares myself.

lightningtiger

Hi Robin66, I had given careful consideration with the points you raised and the unusual reverse split that will take place. Whether the split is 15 for 19 shares held or 5 shares for 19 held, the capital will be the same.

That said, the total return will be the expectancy of the share price to rise, after the price change of the split. How long that will take I don't know. It could of course fall, but based by the net profit estimated to rise this year and the brokers trend showing an upturn, both are positive. It is also worth looking at a 5 year chart where the trend has also been positive year on year. You can see the difference with earlier screens by clicking the arrow to the right of print.

So I will take the dividend and let's wait & see how it goes.

7th Mar '18

Well yes but the capital will reduce by the amount of the dividend.

The key figure with investment companies is NAV not profit. Investments can and hopefully will increase in value over time and so increase the NAV but will not show as profit until they are sold. If you look at both historical and projected figures you will note how " lumpy" the profit figures are whilst NAV has steadily increased. It is increases in the value of the investments which drive the NAV and the share price not the profit figure. It would be good if Stocko gave NAV figures for investment companies in the stock reports!

At least the dividend is guaranteed once the XD date comes up on 15/3/18.They have been paying a dividend twice a year. The thing then is how long will it take to recover the NAV value? We will just have to wait & see.
Stockopedia still does a good job to get most of the information we need.

AnonymousUser252054

28th Apr '18

Special div paid and SP up 10% to 219p - good call.

24th Oct '18

An update from April this year with the Stock Rank now @ 99 with 5 screens and the share price now up to 244.5p having picked up another final dividend of 3.925p along the way. Still showing good support from 50 day MA.

Stockopedia does not include the special dividend of 41.4p in the yield (fwd) either, hence only the 3.9 %yield is showing. By using this idea of adding new shares with good dividends as they start to appear, to my other incoming paying shares which the core holding shares,held for quite a while now, the income produced this year is about 40% up on last year because of this, so it has been worth doing.

mercury61

3rd Oct '19

Thoughts on todays RNS? 'a placing of up to 81 million shares, with the placing price to be determined via a bookbuild. The placing is expected to close in a week.'

andrea34

Considering the size/market-cap of £3IN I am really quite fed up that it doesn't seem possible for the small investor to take part in this placing, with no open offer element presented; I have sold some of mine in protest.

3IN investment company all set for a turnaround with a 21.03% dividend to start with

Unlock the rest of this article with a 14 day trial

About the Author

Lightningtiger

8 comments

Unlock the metrics for all these stocks and more...

Unlock the metrics for all these stocks and more...