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Latitude Financial Group IPO
It is no secret this is to list on the ASX soon, key details from what I can gather:
- An Australian consumer finance company (GEM Visa etc - essentially GE Finance reincarnated)
- Expected to seek to raise about $2 billion for its IPO, in a deal valuing the company's equity at about $4 billion.
- Exact pricing and structure is expected in front of investors next month [August], when the company lodges a prospectus with the corporate regulator.
- $410 million of net cash
- $6.59 billion wholesale funding.
- Targeting a 65 per cent to 75 per cent dividend payout ratio,
- Valuation implied a 5.2 per cent to 7.8 per cent yield, dividends commence beyond the first half of FY19.
- "It expects to grow its balances by 8% CAGR and its cash NPAT by 17% CAGR between FY16 and LTM to June 19."
- Likely to report $1.05 billion operating income in the year to June 2019 and a $266.3 million cash net profit. Those numbers would be up from $1.01 billion and $244.1 million in the 2018 financial year.
- Goldman Sachs said Latitude's key strengths were: strong cash conversion and dividend capacity, digitally enabled business driving scalability, proven credit performance and risk management, multi-channel distribution network with low customer acquisition costs, focused growth strategy and a diversified and broad funding base.
I would argue this is similar to flexigroup, but they wouldn't, as FXL is currently valued far far cheaper!
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Hey TJ have a look at COG. Disclose holding.
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https://www.afr.com/business/banking...0181001-h162x0
Looks like it is all off... Flexigroup's low share price/valuation (even though Latitude like to think they are very different to them and don't consider them a comparable) is probably a large contributor to why some fund managers had expressed concerns about the $4 billion valuation being sought by the vendors.
Last edited by trader_jackson; 01-10-2018 at 06:56 PM.
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What's the ticker? The only Latitude I could find is a mining company.
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Not listed yet, this is to be listed soon they say...
And you'll know about it as it is gonna be a huge listing! (billions and billions)
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Originally Posted by trader_jackson
Not listed yet, this is to be listed soon they say...
And you'll know about it as it is gonna be a huge listing! (billions and billions)
Thanks. Currently I don't own any shares in the finance sector but the summary in the first post did wet my beak.
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And we're on folks...
https://www.afr.com/street-talk/term...0190926-p52v1p
- Market cap $3.56 to $4 billion
- 12.4-times to 13.9-times FY20 PE
- 4.6% - 5.2% yield
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