It never hurts to ask a question, but I think you tend to look for meaning where there is none. The market in FSJ`s shares is , as you well know , usually made up of a plethora of small trades. Very occasionally there is a large sell or buy. You have to get used to volatility under these circumstances. Schroders have been taking advantage of this volatility for years ,sometimes top lopping when the price is high, sometimes topping up when the price is low, but they have rarely if ever dropped much below 9%. I have not checked recently. I used to do the same , but I have better things to do these days , so I simply sit on my not insubstantial holding . I let all this volatility go over my head.
The following is the last paragraph from an article on stock market statistics--
"Trying to identify the number of active private investors with non trivial holdings in the UK is somewhat problematic, but looking at the readership of publications such as Investors Chronicle and tip sheets that appeal to such investors, it is probably at best a few hundred thousand although some may simply rely on their stockbrokers for information (they may even hold discretionary accounts), or do not actively trade. There are also an unquantifiable number of execution only traders who trade actively but move in and out of the market in other words who are short term speculators. These may even trade in CFDs or via spread betting so do not appear in any of the above statistics."
Worth a read:--
There may be a pool of very small active investors/ short term traders who account for much of the daily activity in many shares . The internet has made it possible for anyone to trade cheaply and easily. I know of a schoolboy who regularly trades with very small amounts : why not? A tax inspector told me that they get people whose tax returns include hundreds of small deals a year.
That was still a very odd share price movement yesterday. Maybe it had to do with the end of the tax year - but today the shares are back at 15.25 ex dividend. Since the final dividend is 19.3 pence the shares have effectively shot back up again - at one stage yesterday they were £14.80 cum dividend. I suppose it has to do with there being a lot of long term holders like us, so any buying or selling of even modest volumes has a disproportionate effect on the share price?
I think that you are correct mnamna, in that this smallish niche company has a large number of long term holders, myself included. Shipping is multifaceted, one has only to read the Clarkson report to gain some insight. James Fisher has been well managed on the whole and is a nice share to have in a portfolio because there is the potential all around it, if the management can maintain focus.
This Co. is too small for him to even look at these days, but I tend to think it meets the kind of criteria that Warren Buffet looks for in a share. So long as the management remains sensible, this is a share to hold forever :-) .
possibly because ot the long term holdings the share price is quite highly rated compared with current profit growth (though about right for historical growth), and shares rated higher than the norm tend to be more volatile.
The long term question is of course whether profit growth will recover back to the historical levels or whether the share price will decline to match current levels of profit growth.
There is a hint in the Chairmans report that profit growth levels should revert to the historical double digits. In the meantime the shareprice suffers something of a tug-of-war. Which is itself an opportunity if you can grab it,
The first is the often low volumes of shares traded. Generally when small volumes of shares are traded the volatility in the share price rises as there tends to be more of an imbalance between buys and sells to move the price.
Secondly, and related, I get the impression there are a lot of long term investors (I have held sinc e around 2000) so that tends to limit the volumes of shares traded, which keeps the share price more volatile.
The sp movement before and after the results has been big. Dipping to about £13.50 before the results, not much immediate reaction on the day - but then powering ahead to £16.50 in the following 2 weeks. Can anyone shed any light on all this? Thank you.
Perhaps this broker 'upgrade' has had an effect. There do seem to be large price movements on small trading volumes.
''(ShareCast News) - Investors should take advantage of an unusual opportunity to buy James Fisher and Sons shares relatively cheaply, according to analysts at Canaccord Genuity.
The marine services company has a 23-year record of almost uninterrupted rising earnings and dividends, a balanced business and an established strategy, the analysts said as they upgraded the shares to 'buy' from 'hold'.
This record has meant the shares are rarely cheap but they have fallen 10% in 2018, more rapidly than the wider market.
At £14.10 the shares at the time of writing were trading at 16 times forecast 2018 earnings compared with an average of 17 times over the past three years.
Annual results on 27 February were good and more than £40m could be freed for acquisitions as capital requirements stabilise. The company's offshore oil business will probably do better this year and the consensus for 2018 earnings is on the low side, the analysts said.''
Yes I agree. Though 'solid' may be a little harsh as 10% growth in turnover and profits exceeded my expectations ( consensus for profit growth on Digitallook was 6% so it beat expectations there as well)
More importantly it seems that the 10%+ is expected to continue, reading between the lines of the chairmans statement.
10% increase in the divident comes in handy as well. So I am revising my opinion from a hold to a Buy, albeit a weak one at the current price.
I think thats a fair call under the circumstances. It has now fallen further than I expected so I agree its hard to call - though the fall is with very small volumes. The share price could easily reverse with higher volume, but until there is better news from the company I see little reason for it to regain its long term upwards trend. Could be a while but I do think this is a quality company with a good strategy which will bear fruit.
In the meantime I am waiting before any further purchases,
It is indeed difficult to assess this business. but it is precisely the strategy of diversification ( both geographic and by product or service offering ) that has enabled the company to compensate for the downturn in offshore oil:
A typical days trading shows the vast majority of trades are small, indicating private investor action. There is little or no evidence that institutions are bailing out.
There has been talk a plenty about the possibility of a market crash; that may have some bearing on recent selling. Somewhere I read that the Telegraph recently said sell everything ; that sounds a bit drastic. Perhaps their reporter was got at in some pub.
Although overweight in these, I may be tempted to buy at some point.
For a number of years FSJ have been moving away from their previous core business as a shipping company and is now a conglomerate of small companies loosely connected as marine services, although there are exceptions such as the nuclear division. The problem in trying to get any sense of the direction for the share price is that the results of FSJ are affected by everything from exchange rate movements on overseas earnings, the oil price on demand for oil transport, the size of shipping fleets, building new windfarms and a myriad of other factors. My take is that FSJ have been squeezing efficiencies out of existing businesses for some time now and have grown by adding small acquisitions, but the strategy is now running out of road. I don't see much room for improvement on what is a reasonably efficient and profitable company, but I can see a number of headwinds in the current climate. After holding since 2010, I sold out a month ago as part of a scaling back of my UK investments and will stay out until things become a lot clearer.
I'm not sure it's a lack of confidence in the forthcoming results - more that the results are unlikely to beat expectations. Right at the moment any company on a premium rating that fails to beat expectations seems to be marked down? There is some logic in this? Premium ratings assume premium rates of growth. If this is not forthcoming then a lower shareprice follows. In less harsh times shares may be more easily rated upon future expectations, but right now the market seems to want to see outperformance today.
Binjiou - it may be that the heady growth phase is behind us. If so the shares will gradually adjust to a more average dividend yield of say around 2.5%. Thank you for your comment - glad that you are still in the frame.
It looks like a seller appears when the shares rise above 1600p. Broadly speaking , the shares have gone sideways for some time . We have to live with a degree of volatility. ----No bad news that I am aware of.
I am also a long term shareholder, been in since around 70p from memory.
Fisher is now a part of the FTSE 250 so it's much more investible by institutions than it used to be as a small cap.
Also it's seen as exposed to the Oil and Gas industry and although the offshore oil division has been scaled back since the fall in oil price it's still a drag on the company and has yet to return to growth.
Although the company is positioning itself well for the medium and longterm the problem is that in the short term its not making much progress and the shareprice is pricing in better growth, so the shares have been fluctuatiing in the £15-17 range for quite a while now.
It will take some big deals rather than bolt-ons and some upgrading of earnings expectations for it to move out of the current range. I think it will happen - but I don't know when, and if I did I would be much, much wealthier!
We are very long term holders. The day to day/week to week volatility in the share price seems rather surprising given that the company operates in reasonably stable markets/segments. Any comments? Thank you.
The first three large trades went through within 5 minutes of each other ; the fourth went through some ten minutes after the third. They were likely to be the same seller, and probably four different buyers . (143,794 at 1580p and 75,397 at 1578.42p) ---Everyone has to sell at some stage , and there are many reasons for selling . I see nothing sinister in the latest deals.The shares are fairly highly rated , and deservedly so in my opinion .I am happy to continue to hold.
Weird share price movement following today's solid results. The shares rose at first but around midday there were a few transactions involving about 250k shares, following which the shares retreated. Any clues? Thank you.
Profit in the second half is likely to benefit from the phasing of projects across our renewables businesses due to seasonal factors and across our offshore oil businesses due to some improvement in oil and gas sector demand. We would therefore expect to see good growth from our Marine Support division. In Offshore Oil, orders in our Norwegian and our downhole equipment businesses have begun to show clear signs of recovery. Our Specialist Technical businesses continue to trade well despite some slowing in our nuclear decommissioning activities. Tankships maintain its good performance of recent years. Overall, we therefore expect to see stronger growth for the Group in the second half leading to a good improvement in the result for the year.
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