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BEG LN - Begbies Traynor


petec

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Hi all.  This is a UK (very) smallcap.  It is the biggest financial restructuring advisory firm in the UK.  The UK is currently full of zombie companies that won't be able to afford their loans when rates rise.  I don't want to predict the timing of that but I don't have to: BEG is trading on around 6x earnings and yields 6-7%.  It does have some debt but generates enough cash that I am not overly worried and it has just reorganised all its credit facilities on good terms so there are no major near term maturities.  It also trades on a very low P/BV multiple but be careful with this: there is a huge intangible asset because they acquire similar companies.

 

That's most of what I know at this point but I like the valuation, the dividend, and the optionality.

 

Pete

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