RDF - Redflex

[Lizard]

The world hasn't quite ended. Several parties have expressed an interest in acquiring 100% of capital. Multiple (non-binding) bids at indicative value above $3.50 per share are being considered (was $2.02 shortly prior to announcement). :cool:

[Lizard]

Just following up a few companies I've looked at in the past.

Amazed at the poor results out of RDF last year - just looks like bad management and no wonder there's been a fund-manager instigated change at Boardroom level. Might need to be changes at other levels before it's really a good buy.

Market seems to be supportive for now, but even factoring in a substantial recovery this year, it is difficult to get excited at current price of $2.59.

[macduffy]

It's a long time since there was any interest in this thread.

A few days ago shareholders voted down an offer from Macquarie to takeover the company for $2.70 per share. RDF SP has been marked down to around $1.80. Seems a worthwhile punt to me so I bought a few.

[macduffy]

RDF SP going up nicely in an otherwise soggy market

Last sale at $1.925, still well short of the $2.70 that Macquarie/Carlyle Group were prepared to pay.

Still holding.

[macduffy]

And another 6.5c today to $1.99.

Anyone else interested, or am I talking to myself?

Lizard?

[drillfix]

I am reading MacDuff

Big bounce from $1.66 and then viewing the hourly chart shows $1.86 was a good entry as the 60 minute turned upwards.

Daily MACD histogram diverging and W%R, RSI, OBV all turning upwards.

If were to offer a target, (which I am not) it would be $2.15 approximately which is at the 50% Fib line of where the fall started to the low. BUT needs to break past the current high of the day at the 61.8% FIB line which is at $2.02 to achieve this.

And also there is a gap at $1.93 which at some stage will get retested at some stage, be this week or next, or sometime, but no doubt at some stage it will get tested. Perhaps a good or another buying opportunity maybe? Guess it depends on each trading or investing style.

Good luck with that~!

[macduffy]

Thanks for your thoughts, drillfix.

I'm largely in this stock for the (expected) rebound from the rejection of the Macquarie/Carlyle bid. I'll keep riding the trend as long as it continues but happy to take a profit when that reverses. Besides, this maker of speed/red light cameras owes me a few dollars!

[drillfix]

Besides, this maker of speed/red light cameras owes me a few dollars!

Haaahaaa MacDuff, classic.

Fortunately I dont dive fast enough to get have to make payments to them, but then I dont venture out much either which reduces my chances.

Go0d luck with that mate and hope gives you oodles~!

[Lizard]

And another 6.5c today to $1.99.

Anyone else interested, or am I talking to myself?

Lizard?

Hi MacDuffy,

I'm reading too. Thought it was a good pick for a trade. Been too busy here though, so don't have anything of value to add.

[Lizard]

Hi MacDuffy,

Are you still holding this? Just looking at the profit upgrade and looks good.

I just went over my old valuation model for this one - and turned out last time I'd valued it was 2009... but my forecasts looked pretty much the same (not in a good way i.e "achieved" - but in a bad way i.e. "wasted 3 years"...)

However, they sound like they might finally be getting things together... and at least a bit cheaper here at $1.85 than a few years back.

Just seem to have a habit of getting stuck on the speed bumps... guess they are one company that wouldn't want a speeding ticket. :)

[macduffy]

I'm still hanging in there, hoping Macquarie will show some renewed interest but fearing that the idea has gone cold. Corporate action seems to be on the backburner at present, not surprising given the state of the world! The good bit is that RDF is making a profit and paying a div so there's no particular hurry to quit them. But I must admit that my original idea was to profit from a quick trade!

:ohmy:

[macduffy]

Sorry, KW. To answer your question, shareholders voted down the bid from Macquarie, led by big founding shareholder - name escapes me!

[Lizard]

The trouble with this company is that it's a bit like a hire company - can only grow by investing more capital at uninspiring ROIC.

Even on the improved margins that first half result indicates, they aren't really producing enough retained cash to fund more than about 4%pa growth in their asset base without issuing additional equity or taking on too much debt, so uninspiring from a very long term perspective.

It may be an okay time to buy and catch the current recovery - and perhaps all that capitalised R&D turns out to produce some good margin improvements.

[macduffy]

A nice gain by RDF today - up 4.2% to $2.00.

Reaction from an OK result a few days ago or has last year's private equity takeover interest been re-kindled?

Yes, I hold a few.

:cool:

[macduffy]

It may mean anything or nothing but Macquarie is currently (still) unable to provide a recommendation on RDF due to "research restrictions".

Naturally, I'm hoping that it means that there is still some interest in a Private Equity takeover.