Share price is at the same historic low level as to back when the model was 100% ownership and they had firms losing money, had high debt and their old licence was under ASIC enforceable undertaking and remediation program. Given the underlying business and balance sheet is significantly different now to back when they were in real trouble the market must be lacking confidence in management and the Board. Recent investor briefings have underwhelmed.
No growth in the core business and no M&A activity with nil new firms joining since June 2022. Acquired a loss making licence in Affinia with very different "tribe" of advisers that will likely not end well. Competitors in CAF and DVR will be circling Affinia "tribe" and these adviser will make their own decisions on staying or going. The management team havent impressed and are ex AMP/CBA and these two organisations dont have a pedigree in stellar shareholder outcomes from running financial advice. The Board is looking stale and needs a refresh.
The buy back is ineffective and in small numbers that doesnt move the needle - perhaps showing a lack of conviction by the Board or a problem with the ability to fund with surplus cash.
Was expecting dividends to be maintained at 2 cents per share per half, will watch what happens with the full year dividend with interest.
In summary - it is a management issue.
CUP Price at posting:
54.0¢ Sentiment: Sell Disclosure: Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)