Quindell - Another Bullish Re-hash.

People are probably now used to me stating how much I love Quindell, so I felt that I would cut the filler today and effectively post a fact sheet with a few bullet pointed reasons for why I have always been long/medium term bullish on Quindell and am especially bullish at the current prices.


1. Due Diligence/Price Waterhouse Cooper Report:

• I need to begin with this point, because if the report does highlight some significant issues within Quindell's finances, then all of the below will become somewhat irrelevant.
• Personally, I believe that this report is highly unlikely find major issues within the business (in part for reasons I will state later), but mostly because of the due diligence in place from large insurers, who perform their own tests on the businesses they deal with.
• Quindell have over 1,000 customers (inclusive of major blue chip companies), making the likelihood of the company directors having fooled everyone seemingly quite low.

Sources:

• http://www.quindell.com/customers/our-customers

2. P/E ratios:

• As I speak Quindell currently trades on a P/E ratio of 1.09 - staggeringly low when (as of December 5th) the UK General Financial Sector had an average P/E ratio of 17.78. 
• This becomes even more significant when we consider that (at the same date in time) the Average sector P/E ratio for Technology was 35.74.

Sources:

• http://markets.ft.com/RESEARCH/markets/DataArchiveFetchReport?Category=EQ&Type=FTUK&Date=12/05/2014
• https://www.google.co.uk/finance?chdnp=1&chdd=0&chds=0&chdv=1&chvs=Linear&chdeh=0&chfdeh=0&chdet=1420475400000&chddm=61320&chddi=86400&chls=CandleStick&q=LON%3AQPP&ntsp=1&fct=big&ei=2VKqVNKMAeGOwAOQ3oG4Dg

3. Net Asset Value:

• Quindell is currently trading at a huge discount to its Net Asset Value (NAV) of £929.9m, as of the interim results issued on the 21/08/14.

Sources:

• http://www.quindell.com/images/uploads/irdownloads2014/20140821_IR.pdf

4. Very Few Negative Arguments Carried Strength:

• One major example of this was the debacle that appeared over the use of accrual accounting - a point that appeared to be used to confabulate and confuse investors into a state of further panic.
• Accrual accounting has been used for years and is used throughout the legal services sector and also all-over the UK and Europe.

Sources:

• http://themaskedstocktrader.blogspot.co.uk/2014/08/quindell-understanding-accural.html

5. Potential Asset Sale:

• This combined with the ability to perform share buy-backs granted in the June AGM, presents a situation whereby in the short term there is significant potential for a major rise in Quindell's share price, in conjunction with a likely increase in investor confidence over the medium term outlook of six months to a year.

Sources:

• http://www.ft.com/cms/s/0/0a067200-f8c7-11e3-befc-00144feabdc0.html#axzz3NwHF5UlW
• http://www.lse.co.uk/share-regulatory-news.asp?shareprice=QPP&ArticleCode=yrd36vdf&ArticleHeadline=Update

6. Removal of Robert Terry/Arrival of David Currie:

• The arrival of David Currie as a non-executive Interim Chairman was a necessary step to begin fully restoring confidence in the market, with regards to Quindell. 
• Furthermore, I find it hard to believe that he would have accepted the position had he not been confident that his reputation would be able to remain in tact over his period as acting chairman - he's had over 20 years of experience in the financial sector and certainly wouldn't want to tarnish his personal brand.

Sources:

• http://citywire.co.uk/wealth-manager/news/quindell-parachutes-in-ex-investec-banker-after-ejecting-founder/a784298

I shall draw this to a swift end, but one could continue down this route and list even more points that support Quindell and I would encourage people to follow their own due diligence prior to listening to either the bullish or the bearing perspective (both of which can drastically overstate their points).

Enjoy,

The Masked Stock Trader.