Simon Gordon
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http://www.paypoint.co.uk/
Here is a running summary of this unusual stock - edited from ADVFN:
Hi Guys - saw PAY win the FT award but was put off by high price. Now at £2.18 it looks excellent value.
5p dividend in July and a 7/8p dividend in the coming 13 months.
Growth prospects look bright with a 10,000 waiting list, only slight negative is the supermarkets offering mobile top-ups from the till, which is tough competition.
Post offices closing is a good growth driver. In a way PAY are a quasi-utility which is counter cyclical.
Background info.:
http://archives.tcm.ie/businesspost/2005/03/20/story3246.asp
AGM is in London at the Cazenove office.
Dividend will be paid end July = around 5p.
I understand the big supermarkets are a potential market to sell some PayPoint services through the EPoS Till, but probably not the whole service for fear of big queues forming.
E-pay have their system installed on the big four - Tesco, etc - EPoS tills and it is used to top-up mobile phones. E-pay is owned by Euronet.
I went to my local Jacksons to see a machine in action and the shop assistant said she planned to pay her council tax with PayPoint.
Interesting fact:
A MORI poll found 97% customer satisfaction with PayPoint, 79% of customers are 'very satisfied', MORI said this is an outstanding achievement.
Competition:
http://www.euronetworldwide.com/
http://www.onlinetopup.com/
http://www.alphyra.com/home/
From the November article by Peter Temple:
Of the remaining three stocks, two fall into the category of what Warren Buffet might call "toll bridges". These are businesses with an asset or business franchise that is hard to duplicate.
The first of these stocks is Paypoint. This company came to the market in September and runs the network of terminals in shops that offer electronic payment of utility bills, mobile phone top-ups, council tax and the like. Many people prefer paying bills this way and there is scope to increase the installed base of terminals and attract more companies and organisations to offer this type of bill payment.
Either way, the system has extremely attractive margins on incremental business and an installed base that is difficult for any competitor to duplicate in a hurry.
Seemingly First Data looked at PAY:
http://www.firstdata.com/index.jsp
Here is a comparision of PAY against two Support Services stocks I have been following:
SPICE - Ticker: SPI - Share Price £1.77
2006 April
T/O - 94.7m
PBT - 6.9m
EPS - 12
DPS - 2.2
P/E - 14.75
Yield - 1.3%
2007 April
T/O - 104m
PBT - 8.3m
EPS - 14.2
DPS - 2.4
P/E - 12.46
Yield - 1.4%
ERINACEOUS - Ticker: ERG - Share Price £2.70
2005 December
T/O - 135m
PBT - 24.5m
EPS - 17.8
DPS - 5.75
P/E - 15.16
Yield - 2.2%
2006 December
T/O - 150m
PBT - 27.5m
EPS - 19.7
DPS - 6.5
P/E - 13.7
Yield - 2.4%
PAYPOINT - Share Price £2.18
2006 March
T/O - 95.9m
PBT - 14.5m
EPS - 14.9
DPS - 7.2
P/E - 14.6
Yield - 3.3%
2007 March
T/O - 108.4m
PBT - 16.8m
EPS - 16.8
DPS - 7.6
P/E - 12.97
Yield - 3.5%
Some interesting facts:
Employs 183 people in UK and 4 in Ireland.
2004 - 204m transactions valued at £2.2B.
Average = £10 a transaction.
Waiting list of 10,000 prospective retail agents.
New terminal - expected life of 5 years.
Post Office is the market leader.
Smart card public transport top-up offers growth potential.
Government pushing bank accounts to low paid - direct debits.
In a recession money migrates to cash economy.
Predictable revenues.
High operational gearing.
Highly cash generative.
Post office closure programme.
High barriers to entry.
e-Pay is competition with deep pockets.
If Alphyra float will they suck investors away from the smaller PAY:
http://www.timesonline.co.uk/article/0,,2095-1602264,00.html
This share is very tightly held, looking back at recent trade history shows this illiquidity.
The beauty is the NMS is 10,000 - excellent for small traders. But for whales this an expensive stock to buy.
With the Finals and AGM to follow shortly, hopefully, £2.50 is on the horizon.
Here is a running summary of this unusual stock - edited from ADVFN:
Hi Guys - saw PAY win the FT award but was put off by high price. Now at £2.18 it looks excellent value.
5p dividend in July and a 7/8p dividend in the coming 13 months.
Growth prospects look bright with a 10,000 waiting list, only slight negative is the supermarkets offering mobile top-ups from the till, which is tough competition.
Post offices closing is a good growth driver. In a way PAY are a quasi-utility which is counter cyclical.
Background info.:
http://archives.tcm.ie/businesspost/2005/03/20/story3246.asp
AGM is in London at the Cazenove office.
Dividend will be paid end July = around 5p.
I understand the big supermarkets are a potential market to sell some PayPoint services through the EPoS Till, but probably not the whole service for fear of big queues forming.
E-pay have their system installed on the big four - Tesco, etc - EPoS tills and it is used to top-up mobile phones. E-pay is owned by Euronet.
I went to my local Jacksons to see a machine in action and the shop assistant said she planned to pay her council tax with PayPoint.
Interesting fact:
A MORI poll found 97% customer satisfaction with PayPoint, 79% of customers are 'very satisfied', MORI said this is an outstanding achievement.
Competition:
http://www.euronetworldwide.com/
http://www.onlinetopup.com/
http://www.alphyra.com/home/
From the November article by Peter Temple:
Of the remaining three stocks, two fall into the category of what Warren Buffet might call "toll bridges". These are businesses with an asset or business franchise that is hard to duplicate.
The first of these stocks is Paypoint. This company came to the market in September and runs the network of terminals in shops that offer electronic payment of utility bills, mobile phone top-ups, council tax and the like. Many people prefer paying bills this way and there is scope to increase the installed base of terminals and attract more companies and organisations to offer this type of bill payment.
Either way, the system has extremely attractive margins on incremental business and an installed base that is difficult for any competitor to duplicate in a hurry.
Seemingly First Data looked at PAY:
http://www.firstdata.com/index.jsp
Here is a comparision of PAY against two Support Services stocks I have been following:
SPICE - Ticker: SPI - Share Price £1.77
2006 April
T/O - 94.7m
PBT - 6.9m
EPS - 12
DPS - 2.2
P/E - 14.75
Yield - 1.3%
2007 April
T/O - 104m
PBT - 8.3m
EPS - 14.2
DPS - 2.4
P/E - 12.46
Yield - 1.4%
ERINACEOUS - Ticker: ERG - Share Price £2.70
2005 December
T/O - 135m
PBT - 24.5m
EPS - 17.8
DPS - 5.75
P/E - 15.16
Yield - 2.2%
2006 December
T/O - 150m
PBT - 27.5m
EPS - 19.7
DPS - 6.5
P/E - 13.7
Yield - 2.4%
PAYPOINT - Share Price £2.18
2006 March
T/O - 95.9m
PBT - 14.5m
EPS - 14.9
DPS - 7.2
P/E - 14.6
Yield - 3.3%
2007 March
T/O - 108.4m
PBT - 16.8m
EPS - 16.8
DPS - 7.6
P/E - 12.97
Yield - 3.5%
Some interesting facts:
Employs 183 people in UK and 4 in Ireland.
2004 - 204m transactions valued at £2.2B.
Average = £10 a transaction.
Waiting list of 10,000 prospective retail agents.
New terminal - expected life of 5 years.
Post Office is the market leader.
Smart card public transport top-up offers growth potential.
Government pushing bank accounts to low paid - direct debits.
In a recession money migrates to cash economy.
Predictable revenues.
High operational gearing.
Highly cash generative.
Post office closure programme.
High barriers to entry.
e-Pay is competition with deep pockets.
If Alphyra float will they suck investors away from the smaller PAY:
http://www.timesonline.co.uk/article/0,,2095-1602264,00.html
This share is very tightly held, looking back at recent trade history shows this illiquidity.
The beauty is the NMS is 10,000 - excellent for small traders. But for whales this an expensive stock to buy.
With the Finals and AGM to follow shortly, hopefully, £2.50 is on the horizon.
Once myself and a couple of others straightened out the systems (unfortunately the person from my company who was responsible for them as an account was a lazy sod who hadn't helped them set it up properly) things got much better, as I mentioned before I now understand they're doing well from an EFT (electronic funds transfer) perspective.
