Professor Glen Arnold

I’ve bought into the nice steady, safe and secure – in relative terms for an equity investor – business of Highcroft Investments (LSE:HCFT) at £8.75 for my net current asset value portfolio. It buys commercial property, mostly large warehouses, retail warehouses or offices, and rents them out to the likes of Booker, British Airways, Parcel […]

Having bought N Brown (LSE:BWNG) shares in 2018 and 2019 in the hope of a restoration of earnings to more than 20p I’ve now sold in despair at the capability of the managerial team to lift the company, having lost over half my money (bought at £1.42 and £1.30, sold £0.557). This is a company […]

Following a strict value investing approach I sold a lot of shares before and during the first Covid wave (I recommend investors read The Economist if you want to make educated guesses about the future – it was telling me about Covid in China very early in 2020). The pile of cash was useful later in 2020 […]

Caffyns (LSE:CFYN) has been a family-dominated firm for over 150 years, despite it now being a Premium Listed company on the LSE. The family have been accused by a bulletin board writer of running a corporate board of directors which “is grossly self-indulgent”. I need to start the process of assessing whether this is true to […]

In earlier newsletters we established that Caffyns’ (LSE:CFYN) net current asset value is between double or treble the current market capitalisation (assuming properties are current assets and there is no need to write down the value of its stock of cars for sale). We’ve also seen a big improvement on the balance sheet, financial distress […]

I’ll use Piotroski’s nine variables to get an overview of financial distress risk at March 2021. Is the company profitable? In the year to March 2021 Caffyns made £1.4m profit after tax, therefore it gains a Piotroski point. 2. Does the company produce positive cash flow from operations? Caffyns generated £4.6m of operating cash flows before […]

Superficially, there is an impressive gap between the company’s market capitalisation, £12.5m, and property assets of £54.7m. But before getting carried away we need to consider whether the company is vulnerable to failure because of its debt levels and covenants on those loans. Net bank borrowings fell between 31st March 2020 and 31st March 2021 from £16.1m to […]

I first bought into Caffyns, the car dealer (LSE:CFYN), in 2017 for my Modified price earnings ratio portfolio. But I sold it last summer at the height of the first Covid-19 wave as part of a defensive strategy in fear of a long and deep recession, which would not be good for either car sales […]

I’ll consider Orchard Funding’s (LSE:ORCH) financial stability by firstly looking at its vulnerability to financial distress and secondly it propensity to generate cash year by year. Piotroski analysis In 2000 Joseph Piotroski published research looking into the question of whether you could take a bunch of value shares and then separate out the strong from […]

Orchard Funding (LSE:ORCH), a company I bought into this week, is a small player in an industry dominated by two giants. Nevertheless, it has been profitable in each of the last ten years. Indeed, it was growing profit steadily until Covid-19, so there must be some degree of protection from the big boys bullying the […]