sorry i sent without pasting from 27/4/18 when sp was around...

sorry i sent without pasting from 27/4/18 when sp was around 70c:

“bfg is a fascinating stock to own. on its current financial metrics it is:
- p/e 9 given eps was around 7.8c
- insane divi of 7.5c fully franked so over 10% and grossed up to 15%
- 5yrs of consistent growth in revenue, profit and dividends
- sp return of almost 100% for those who bought in 2014 at 40c
- forecast for eps growth in 2018 based on feb outlook statement and 5yr trends and current global equity/ capital/ fx exchange market conditions
- strong investment in technology to drive their internal platform (fusion) for analysts/ advisors as well as investment in their online broking software (bell direct)
- expansion of their equity capital markets business with 25% growth in 2017 due to a broad based growth in equity raise activity for small and mid cap companies, with bell direct growing from the 8th to 5th largest ECM player in 2017
- expansion of funds under management by 25% as well as higher bell direct equity trading platform transaction volumes and more margin loans which all led to expansion of what bfg call ‘low touch revenue streams’ ie easy money with high levels of recurring income.
- expansion of their financial adviser team through active recruitment and strong ongoing investment in technology with over 60 fulltime IT staff
- future commercialisation of their fusion platform to profit further from their capex investment over the past 5 years
- expansion into a new york office to improve their global footprint and reach in terms of access to and efficiency in managing wholesale corporate debt issues, US markets and IPOs, bonds, etc for the benefit of high net worth sophisticated investors.

according to 2017 annual report (feb 2018) they have around 60mill cash and no debt.

the only reasons i can see holding the sp back are:
1) small market cap precludes institutional investors or at least limits their holdings to <1%, and analysts dont bother covering it.
2) low liquidity exacerbates this issue, as more than 50% of bfg shares are held by bfg and directors so the free float is limited; daily volume is only 50-100,000 shares and can easily drop well below this in quiet periods
3) since the disastrously timed listing / ipo in 2008 at 2.00 followed by a sp drop to 40c in the gfc, the sp has struggled to recover until 2015/16 despite reasonable business performance and modest growth in eps/ dividends. there is clearly a skepticism and reluctance for many in the market who were around in 2008-14 to invest in bfg due to this unfortunate history.
4) as a small fish in a pond full of big fish (macquarie, ubs, jp morgan, etc for ECM and cba/ nab/ macq etc for online trading platforms) and therefore not only does bfg lack a clear moat, it likely is at a competitive disadvantage due to the advantages of size and scale in financial markets (larger analyst teams, lower overheads, broader global knowledge base, higher advertising / marketing budgets, superior brand power/ awareness, IT support scale, etc). despite the numbers bfg has achieved over the last 3-4 years, fund managers clearly dont believe growth is sustainable.

having entered in low 60s a year or so ago, my present thesis on bfg is this:
1) the may 2018 agm update will likely be very positive given the initial signals provided in february, the modest 1st hlf performance in 2017 as a baseline for comparisons (h2 was much stronger), the increased market and commodity and foreign exchange volatility which benefits bfg, the new york market opening, the strong ECM activity, etc.
2) the company is grossly undervalued due to sentiment and market inefficiencies in lricing the stock due to low market cap, low liquidity and low awareness. it should trade around $1.00
3) the sp may be subdued until feb next year when the next large divi is paid out.
4) given the divi is becoming ridiculous, a more sensible use of cash may be a share buyback and this should he considered.
5) sentiment will shift over the next 12 months if bfg performs as well as it has over the oast 3 years, because the metrics will force the market to re-rate the stock and consistent growth will eventually convince the cynics as fomo kicks in. that would he the time to sell...”