EML Payments Limited

ASX:EML

EML Payments Limited

ASX:EML
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$0.990 (0%)
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#105
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27
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Reports (20) My Report Forum Investors
Forum Topics EML EML Bull Case

Pinned straw:
jimmybuffalino
Added 4 months ago

Further to reddogaustin’s post, Jeremy Raper’s (now unlocked) write-up for March sets the scene pretty well. His subsequent Twitter threads are also worth a read.


https://rapercapital.com/2023/03/30/new-idea-fundamental-value-w-event-kicker/
Solvetheriddle
3 months ago

@jimmybuffalino thanks jimmy i will have a look at this. i met Tom maybe 10 years ago a few times, i liked him, but the valuation was crazy. then they became way, way more complex than my small brain could comprehend. maybe it's time to relook, back to the future!

9
jcmleng
3 months ago

@jimmybuffalino, thanks for the share of the Jeremy Raper article. It was a very good read, even with the benefit of full hindsight, and really helped me decisively crystallise my actions for EML today.

Essentially, EML's core businesses of G&I and GPR have continued to grow solidly since 2018/2019, not much wrong with them. PCSIL needed to be cauterized in some way - he talked about the possibility of a sale of PCSIL. Once removed from the equation, EML will go back to the cash generating core businesses and grow from there.

Which is what has happened but via a liquidation of PCSIL instead of a sale. This is a much more decisive and Board-controlled action than a sale, which may have dragged on ...

Jeremy also talked about the tailwinds from higher interest rates - that has already manifested in the last results and will continue to contribute for at least another year-ish perhaps, before rates go back down again.

My review of 2 months ago was to hold EML and only consider adding if there was some tangible and positive development on PCSIL remediation or sale. With PCSIL now decisively sorted, pulled the trigger today and added 0.4% to my current 1.02% holdings IRL, and in SM. Will look to further top up if it falls further from here.

Discl: Held IRL and in SM

15
UlladullaDave
3 months ago

I think the market probably ran a bit ahead of itself and then mis-read the 29th of November announcement which, to me, was EML throwing its hands up and saying the issues at PCSIL were not easily fixed and it was likely to continue burning money for the foreseeable future. The market missed the nuance of that statement; EML was proposing, perhaps telegraphing to the regulator, that it intended to shut it down, but the market read it as ongoing losses for the foreseeable future. The shut down happened at the first (and it turns out only) board meeting with the reconstituted board.

PCSIL was a dead duck from the moment it's AML compliance issues were in the sights of the CBI. Lax compliance – looking the other way – is a competitive advantage until it's not.

I believe a full sale is probably on the cards from here. Killing off PCSIL makes a trade sale a lot easier. The interim CEO is there to effect a sale. Alta Fox likely needs the business sold in order for them to exit their position in an orderly way. So yeah, sale seems imminent. PCSIL was the real cancer and thankfully that issue has been dealt with.

21
thunderhead
3 months ago

That's how I described it on another forum. The cancer that is PCSIL has been extricated, and it clears the decks for a re-rate and potential sale eventually. Holders can hope they realise as high a price for the business that remains as possible.

12
AUROPAL
4 months ago

Thanks for the share.

I follow him on Twitter and have agreed with his write ups on EML. Unfortunately I still don't think it will get back to the $5 highs!

13
reddogaustin
4 months ago

Thank you indeed. Great link! Explains the value proposition simply. And how us long suffering holders aren't completely insane.

#iHeartConfirmationBias

14