Is This A Buy Yet??????????? @115p

Blimey. Thank my guardian angel I'm not in this one!

I think not driver:
"Paragon Group of Companies slumped 79-1/4 pence, or 38.8 pct, to 125 as the possibility of a rights issue overshadowed a higher full-year pretax profit, prompting KBC Peel Hunt to cut its rating on the stock to 'sell' from 'speculative buy'."

HC

To risky for yer.

It's OK, dont worry.......That giant of a man, gordon brownhole has abolished boom and bust.

So the likes of dead parrot dodgy housing loans inc causing problems for punters is a figment of the imagination.

Too risky??? Jeez, there's not even a bounce to get excited about!
If you want to throw your money away, driver, throw it in my direction. :o)

Banks and Financial's..forget 'em for a while if you ask me, unless your into shorting of course.

Very much so Stan, missed this one though!!

Still think it's a 'buy' driver?
Very tricky to pick the bottom of this one, imo. (Excuse the expression).

Still on the way down 36%

You could view it as 280m issue (no condidence) against a market cap of half that. If issues taken fully sp dilutes by a factor of 3. However should market conditions (or interest rates fall as some predict in the new year) issues won't be required leaving the share very undervalued!! Very hard one to call at the mo so for me its a watch and see. Could jump on with the band wagon, plenty of upside should conditions prevail..

Looks like another NRK.

A small bounce today up 12%

There is a chance Paragon will totally collapse.

"If the government had a bad week last week, the banking and property world is suffering more. Northern Rock's shares fell to an all-time low, new mortgages dropped to a 10-year low, Paragon, a company specialising in buy-to-lets, said it might have to suspend new lending because of the credit squeeze as its shares halved, and Barclays announced more than 1bn of loan write-offs from its American lending."

http://politics.guardian.co.uk/columnist/story/0,,2216776,00.html

From the Sunday Times
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article2935671.ece

Paragon backers pledge

FOUR top investors in buy-to-let mortgage lender Paragon have vowed to provide a cash injection to fend off the threat of it having to launch a rights issue in three months.

Paragon said last week that it was struggling to refinance loans that fall due in February. It has been been in talks with its lenders since August about replacing a working-capital loan that is due to be repaid. The company had persuaded its adviser UBS to line up a rights issue in case a new loan could not be secured on reasonable terms.

But now, Standard Life, Blackrock, M&G and Schroders which between them hold more than 23% of Paragon have told Paragons board that they are prepared to back a funding exercise to raise the full 280m that the mortgage lender requires.

certainly an interesting punt, but can't weight up quite how risky

Keep an eye on it in the morning and see what happens. If I see buyers lining up I might go for it. Otherwise: RIO is the place to be I reckon.

I went in at 1.3395 but purchase not showing yet. Hoping for a quick profit and exit today.

i have just gone long too, albeit at 141.5 ..... i'll watch carefully, but i really don't think this company will go belly up, and sp could (easily?) get close to 200 (see above) before running out of puff .... whether or not i shall choose to stay in that long remains to be seen.

I decided on RIO this morning (not as a destination, though that would be fun!). Meanwhile, I think PAG is one to watch v carefully. I agree it could bounce back to anywhere around 200-250p quite soon. Good luck!

I have just bount 5000 at 1.30 and will wait to see how they go.

Janet, how do you bount, lol.

what does the word bount mean?

I dont know, you used it in post 23.

sorry I meant bought, my mistake - sorry

I think a long is a good choice with todays news that PAG are looking to raise 140m with the sale of car loan notes, I may well also go long. First though I want to see how much discount they have to give to raise 140m on loan notes, as this may cause the sp to drop further, considering the recent crunch I'm expecting discounts not to be favourable.

I agree, it smacks of a Fire-Sale - not full blown, with sirens blaring - but a nasty whiff of smoke in the air.
You can be sure the sale will not realise the true value, so this means [PAG]-Execs have destroyed value, but then the sp has been shouting this msg for some time.
I suspect this will have further to dip.

Look at the 2-year graph and compare with Jarvis (rail)[JRVS] - oddly they are almost exactly at the finish (ie "now"), having started at a normalised equal, not that there is any connection, just an investor's lament....that an Outright Rogue stock is no worse than........

Today could be the start of another slide...122p now.

DMA 50 and below, still on a downwards trend. I'd prefer a fund raiser such as rights issue to existing holders only to raise capital first, afterwards then maybe look to sell loan notes... And he's me, don't even own any stock but finding this interesting. Paragons board are no strangers to adding value so why not now..

paragon doing well today are you still in there cynic and do you still think there is a good way to go?

'fraid i got this one all wrong ..... bought when i shouldn't; ditto sold, or at least with hindsight

Janet, I'm still holding and in profit, but not for long.

I am hanging on a little longer

I reckon that, as it's already nudged above the 140 mark a couple of times in the past few days, it could well keep going up. I'm in this currently and will continue to hold.

the company has just been upgraded to 1.75p per share today. This is the reason for todays rise in price. the reason been the buy to let market has improved.

I hope you mean that to be 1.75 - or 175p Janet! Otherwise we're all done for!

it is 1.75

That's a relief, as I'm not into shorting!

114p now.

paragon was a firm buy with british bulls on friday at 1.20p

Managed to blag some pag at 60.25p, should I hold or sell?, dropping from 72p now

janetbennison
Are you still in.

Starting to look cheap, I think.

tempting ! 62 AT MO

so, whats the rights price..?

LONDON (Thomson Financial) - Buy-to-let lender Paragon Group of Companies said it is raising 287 mln stg through a deeply discounted rights issue in order to plug a funding gap left by the credit crunch.

Paragon, which lends to house buyers who aim to let out their properties, said the proceeds will be used to repay a 280 mln stg loan that falls due on Feb 27.

Under the terms of the rights issue, which has been fully underwritten by investment bank UBS, shareholders will be offered the opportunity to buy new shares in the group at an effective discount of 90.2 pct to its Jan 10 closing price of 102 pence.

Paragon, which relied entirely on the wholesale markets to finance its mortgage lending, has had problems raising funding since worries over rising defaults against US sub-prime mortgages prompted banks to largely suspend lending to each other in August last year.

'The board believes the rights issue will provide Paragon with a platform from which it can pursue further funding, so the company can return to writing significant volumes of profitable business when credit markets reopen,' Paragon chairman Robert Dench said in a statement.

so does it mean new shares will be 10p....? i don't get this..

I can’t get my head round this not holding so I’m not going to bother but on the other side they are saying this is expensive and should be @ 20p-30p some punters have lost a lot of money this morning there was sells of 100k earlier not nice to wake up to.

Missed the bounce, sold for small profit after costs, not worth the heart attack!!

At 55p 1 share gives you the right to buy 25 new ones at 10p I think ?? to early for me :)

Some stuff from the other side.





In your example your £1K bought you 1000 shares.

These will be consolidated on a 1 for 10 basis, so you will have 100 shares.

You will then be offered 5 new consolidated shares at £1 each for every 2 non-consolidated shares you currently hold (the 10p ones), you will therefore be offered 25000 new shares at £1 a piece. If you take up the full rights your holding will be 25100 consolidated shares at a cost of £26K. You would need the consoldated SP to rise to £1.036 to get your money back.

However, a £25K investment is a pretty sizeable committment if you only had £1K invested beforehand.


Davius is that right... its 25 share at 12p?



No, rights shares are effectively 10p per share, not 12p. They are priced at £1 per new share (a new share is 10 old shares consolidated).

And you don't have to find the money to take up the shares. You can sell your rights, assuming they have any value. But if the rights don't have any value, then PAG today doesn't have any value either!

Thanks Driver, I think I will stick with GCM :)

Grief! - er Gulp!
- and I hate Companies that shuffle their shares . . . CONsolidation is just that IMHO - a CON, designed to make punters think Execs have done some good ( so they collect their Bonus), and . . . . . . that's allright then.

26Nov2007 (sp c.?1.40)...On news they were to sell-off the Car division...I said: " - - - I agree, it smacks of a Fire-Sale - not full blown, with sirens blaring - but a nasty whiff of smoke in the air.... - - - "

-And now punters see a sp that is halved at a stroke. . . .
Do I believe the sp now is "correct" and therefore worth a punt, or has this boat lost its engine last year and the rudder has stuck on some weeds and we're heading for the river-bank?

When I saw this today I thought: - Maybe a bounce, ie Worth a punt, but my hands have remained in pockets for some while now and in these "Troubled Markets" I suspect that is the best place for them.

When posters "here" can't fathom out what the effect of the Rights will be, and we can't find the "price", . . . . . . . . . . . . it smacks of Management having to put out a statement before the deal is fully worked-out.
-OR - the deal is so bad they hope that by releasing it gently the damage will be minimal.
To use another water-word:-
- BARGEPOLES

I just hope those who bought arround Nov07 have a few gains elsewhere to balance.
.......but all Sectors are affected and anything connected to Property, or Banks (esp. Mortgages), and worst of all IMHO is Sub-prime, or what we call Buy-to-Let, for it has been reported elsewhere that B2L investors have been relying on Capital Gains to offset poor Rental-returns since about 2005 - fortunately 2005, 2006 and most of 2007 saw house-prices rising, as folk continued to believe they "had to " get a Mortgage, before Interest-rates rose.
What they appear to have missed is that for every 1/2 percent rise in interest the Housing Market stalls and many properties are being offered at discounts of 10% - 20% and more.
Paragon sold ( did they?) their car-loan business I read - and this was a sensible thing to do, but far too late IMHO. . . . Car sales have been down for years as new models offer "cashback". This affects the secondhand market as folks can't make sense of it; and it looks like waiting is Good.

My suspicion FWIW is [PAG], correct-price with this rights is 50p - but if the take-up is shakey, or Others sell their old shares, then it could easily drop to 30p; demonstrating the true-worth of this Management and their abilities to plan forward.
I cannot see new housing being a good investment for at least a year and if past-experience is anything to go by, it could be more than 2 years before there is any hint of housing-recovery and that will start in North-London ( the Olympic-anticipation ). . . .
Any opposing views...?

hangon
Cheers good post I agree with the housing for at least another year and the rights statement is just a mess
Hands in pockets it is then.

Is this proposed share consolidation and rights issue merely an attempt by the underwriters to take control of PAG if existing shareholders dont take up the offer?

Driver shouldn't the above example be you'd be offered 2500 shares at £1 and if taken up in full folding would be 2600??? 1000 shares @ 0.10 / 2 gives you 500 times 5 = 2500 + the consolidation total holding 2600..... Anyone else working this out the same????

explosive
Yes and I still don't like the look of it.

The question is what will the shares be worth after the rights issue?

In the past I have purchased shares in a rights issue, to find that there was a lock in period of a week or so, to work out uptake and float the rest on the market. During this time it may well be possible to purchase at a lower than float price with no lock in. Remember just because you hold you don't have to buy more shares at float price. Thankfully I was out of this one a month or so ago, but will watch with intrest as the full extent of the dilution becomes apparant. DYOR.

This rights issue with the consolidation is a huge dilution especially as funds raised are to be used to pay off lenders however needs must, without this would PAG survive. NRK all over again!

Unfortunately I have got caught up in this one, I had a stop loss on the postion and got closed out this morning at the lowest price of the day at .55p. I bought the shares back at a higher price. I am not going to buy any more share in the rights issue. I am having difficulty in understanding how I stand in the rights issue. I would just like a simple to understand explanation of how this will end up. Lets just use an example on say 10,000 shares for eg. can any of you explain to me the position. I do not think the shares will drop now they have settled today around .62p. I am making a terrific loss on this one, and to say I have a bad cold at the moment. This was the last shock I needed for the week end. This may be an opportunity for other to enter. We will have to wait and see. Good luck all.

Have any others on here been caught out on this one?

janet .... don't feel like the lone ranger is dumb choices of shares ..... i have been a star performer in that particular league in the last couple of weeks, and i am sure there are plenty of others who are just too shell-shocked to hold their hands up ..... for me, thank goodness for IEC and a couple of others!

cut your losses, dust yourself down and work out a strategy to rebuild

british bulls were saying this was a buy at 1.20 a few days ago, so much for brit bulls They are now telling people to wait. Their last sell recommendation for this stock was the beginning of dec. I do not think a deal to british bulls they get it wrong many times.

article in the times today. For each paragon share held. You will get one share for each ten shares held. So for eg. If you hold 10,000 shares now. Your existing shares will become 1000 new shares. My existing shares average out at 1.10 per share. For every share then I will have the right to buy 25 new shares at the 95 per cent discount of the closing price on thursday. So I would then be entitled to by 25,000 new shares at .092004p per share. If I was to do this then the average price of all the shares would be around .49 pence per share. If all was to go successfully. Existing share holders who hold the shares from the higher price of say 1.00 or more would have a good chance of recouping their losses rather than selling now and taking the loss. So in my case providing the share does not fall below .49 pence. Then I could break even at.49p. If existing shareholders do not go for the offer of the new shares then their existing shares will be diluted by 90 percent. Then you would really do your brains in. This is like a blackmail situation saying if you do not go for their offer then would will loss another 90 percent of the share value. I suppose I will have to go for their offer. Unless the position changes before the time. If existing share holders can afford to buy the new shares and providing the rights issue is successful then all could be okay on this one. This could be a wonderful buying opportunity as well for anyone going in now at a price of .61.5p. These will be the people making big money out of the rights issue. Not me. Cynic have a look at the article in today times online and give me your opinion. If I was to sell now I would be onto the terrific loss.

janet ..... i get the Fascist Gazette (Telegraph!) from which I quote below .....

"Investors who do not take up their rights will see their holdings diluted by 96.2% ..... Paragon is unlikley to be sold until the markets improve"

imo, buying opprtunity this is not! ..... as for your personal decision, i am afraid it is very difficult to give any advice, but i really cannot see you making good for at least 12/18/24 months and maybe not even then.

thankyou cynic.

hoping to open up a short on monday morning, if not then i'll sell it on CMC, can see this falling heavily throughout that week. Who would take up shares in a company that really couldnt be in a worse market at the moment and couldnt be in a weaker position. Paragon is desperate for money in a market where there is none available, its lenders arent going to extend deadlines and I think it will be in serious trouble for the rest of the year and beyond (if it makes it)

it may not be possible to short, not least because someone will need to be willing to lend stock

Their lenders havent pulled the plug yet. As I said in an ealier post if shareholders dont take up their rights the shares will be taken up by the underwriters who may turn out to be the repaid lenders. In other words a cheap debt for equity swop with control of the company passing to the banks.

33% rise today is that short covering or maybe something else?

I can't believe shorters could do this - the fall was very fast last week - almost too fast compared with normal activity - so I guess it was large holders getting out.

Similarly the rise today is on a distressed sp, but whilst it is spectacular for new holders at 60p, it may be a dead-cat bounce. . . .. time will tell.

I would have preferred to see such a jump from maybe 20p . . . as I'm sceptical this business is still worth nearly 1 when the (Housing Market) future is wholly unknown.

too difficult for a numbskull like me to work out, so stayed well away

With the existing credit crunch, PAG is a SELL

I sold mine yesterday at .83 and a quarter. Just bought them back at .73p I am down a lot on mine so I am trying to get somes losses back.

You are very brave, janet. At 114p, I thought this would go down (post 30) and I don't trust britishbulls.

just sold at .81p

58% up this must be consolidation day?

Yes 1 for 10 share consolidation yesterday.

Bargepoles I think for anyone not "in" - and maybe for the others too.
Whatever happens you have to remember that poor executives have got you where it is - - - and they are still in charge of the ship as the tide turns, maybe to dash you on rocks below.
This stock is yet another where the prevailing good sense of Retail Shareholders is ignored in favour of Board+Institutional holders who are "betting" with someone else's money.

Is anyone (here) a customer of PAG - and can give that perspective?

The rise might be "relief", but it's hardly good news compared with recent prices. What is surprising is that Management managed to keep the lid on their woeful state, with Banks wanting to get the business cheap to offset their other woes.

Looks a good call from investor Inteligence today adding PAG parogon group to its buy portfolio. Broke through resitance at 80p and is going strong.

Portfolio Update

We add a long position in Paragon Group, based on its upside breakout at 80p (see right). This signals that near-term upside renewal is a strong possibility.

afternoon sticky ..... where have you been hiding these last weeks?

Hi cyners. On hols over in Rhodes at the moment then fly onto holiday home in Malta. About 2 months but will hope to keep poping in. Im sure your making the doe pile up.

PAG seems to have a breakout from a flag formation......

and broken through resistance at 80p.



Could be promising. Not my cup of tea this sector though.

related to this sector, i have been playing with WOS a bit, not necessarily with success!
however, overall, am clad to say have prospered over the last 3/4 months and have even had the discipline to take funds off the table at regular intervals.

here's another PAG chart ...... it really does have such low volumes of trade that i personally wouldn't touch it.

131 now, 85p when last posted on here, over 50% gain. Possible FTSE 250 entry this time, seems to have slipped under the radar on here.

PARAGON GROUP (183p)

Nearly four years ago, Paragon was on the brink of collapse. A buy-to-let mortgage provider, the company was described in one analyst's note in 2007 as "Para-gone".

Paragon did not go. Against hefty odds, the business survived and last year, after putting itself into hibernation for more than two years, it began lending again.

Such has been the company's renaissance it has even begun to pick prime mortgage portfolios off larger rivals such as Royal Bank of Scotland that only survived the maelstrom of 2008 with billions of pounds of taxpayers' money.

This instinct for survival and a good opportunity are important skills for any financial company's management in the choppy markets we are likely to see in 2012.

Paragon's top team has demonstrated these qualities in unusual quantity, making its shares a good pick for the coming 12 months.

Buy-to-let mortgages carry considerable risk but Paragon's ability to pick the choicest borrowers means it is unlikely to be the first to come unstuck if property takes a knock.

Not only this, the company has learnt from the last crisis and has locked in longer-term funding, making it more resilient to the ups and downs.

Probably not one for the faint-hearted, but it could be a top performer.

hit a new high this week, reaching 197p yesterday to just pip its previous peak of 195.7p set in March. The buy-to-let mortgage lender has had a good year, rising from a low of around 140p last October, and has since experienced a somewhat bumpy ride to gain 38% to today.

Forecasts are good too, with the shares on a forward P/E of only 8.6 for the year to September, dropping to 8.1 for next year. The expected dividend is modest, at around 2.5%.

.

Final Results

Highlights

Financial Performance

· Profit before tax of £95.5 million (2011: £80.8 million)
· Underlying profit increased by 16.2% to £94.2 million (2011: £81.1 million)
· Strong cash position and cash flow
· Step change in dividend policy with final dividend at 4.50p per share (2011: 2.65p per share). New policy of targeting 3.0 - 3.5 times cover over the medium term
· Shareholders' funds £803.5 million (2011: £742.0 million)
· Net asset value 269p per share (2011: 250p per share)

Strategic development

· Three consumer loan portfolio investments, total £115.4 million, completed during the year
· Buy-to-let origination franchise well established, £184.3 million advanced (2011: £127.0 million)
· Two securitisations of buy-to-let loans completed
· Warehouse funding capacity increased by 125%

Berenberg Bank raises target price to 280p from 230p; rating buy ...... whoever they are!

Share price reaction to finals abit of an upset. Not sure why though, I'll have to take a good look at the results.

Peel Hunt Buy 241.90 250.00 288.00 - Retains

Canaccord Genuity Buy 241.90 250.00 313.00 313.00 Retains

No surprise Skinny, most brokers have these at 12 times earnings or slightly lower as I do. Expected a rally today, looks like I'll have to wait for my money though. With a margin at 40% of stake I'd rather not be holding for any length of time.

Arguably its had a good run - it looks compelling, but will look even more so a bit lower!

Glad I bought March 13 future now.

PAG PARAGON

Moving up nicely.

Brokers have some bullish SP targets.....

Stock on a lowely P/E of 8.8 to 2014.

Far too cheap.

Date Company Name Broker Rec. Price Old target price New target price Notes

22 Nov Paragon Group of... Shore Capital Buy 245.15 - - Reiterates
21 Nov Paragon Group of... RBC Capital Markets Sector Performer 245.15 240.00 260.00 Downgrades
21 Nov Paragon Group of... Numis Sell 245.15 - 168.00 Reiterates
21 Nov Paragon Group of... Jefferies International Buy 245.15 260.00 290.00 Reiterates
21 Nov Paragon Group of... UBS Buy 245.15 262.00 265.00 Retains
20 Nov Paragon Group of... Peel Hunt Buy 245.15 288.00 - Retains
20 Nov Paragon Group of... Canaccord Genuity Buy 245.15 313.00 313.00 Retains
16 Nov Paragon Group of... Berenberg Buy 245.15 230.00 280.00 Retains
14

GF my sentiments also, on a PE of 12 the sp would be some 287p but currently the market doesn't agree. Paragon have got everything in place to restart buy-to-let but its slow going at the moment. I think low interest rates that can only go one way is putting people off even if sky-high rental prices and good margins are achievable at the moment.

Yep ive got a few detailed broker notes, might help.

Financial
Paragon (PARA.L) Anton Kryachok............ +44-20-7568 3580
Analyst
anton-a.kryachok@ubs.com
Alastair Ryan...................+44-20-7568 3238
Analyst
alastair.ryan@ubs.com
Price (19 Nov 2012)..............241p/US$3.83
12-month rating...............Buy (Unchanged)
12m price target.....Prior:
262p/US$4.17 => 265p/US$4.21
Market cap...................£0.73bn/US$1.15bn
Full-Year EPS
2012E............................... 23.34p => 24.24p
2013E............................... 26.79p => 27.24p
L.aying solid foundations for 2013 Strong delivery on key aspects of the business
2012 was another year of strong performance from Paragon: the successful completion of the
new PM17 securitisation, an enhancement of warehouse facilities and robust earnings delivery
from IDEM. These developments leave the group well positioned for a strong performance in
2013, in our view, which to a large degree will be measured by the pace, profitability and credit
q.uality of new BTL lending (UBSe £350m) and an improvement in stated RoEs (UBSe 9.7%). FY2012 PBT 3% ahead of consensus, dividends up +50% y/y
FY2012 PBT came in at £95.5m, +3% ahead of consensus and +4% ahead of UBSe, supported
by stronger than expected Net Interest Income of £157.8m (+3% ahead of UBSe) and better
provisions (£24.1m, -11% UBSe), as BTL loans in arrears for 3+ months declined to 48bps from
54bps in Q3 12. The Board proposed a final dividend of 4.5p per share, taking a total dividend
f.or the year to 6.0p (up +50% y/y) ahead of UBS expectations of 4.5p. Earnings upgrades: +2% to 2013E EPS
On the back of FY2012 results, we increase our 2013E earnings by +2% and revise up our
2013 DPS forecast by +28% to 6.6p to reflect the new dividend policy. We trim down our
f.orecast for new BTL lending in 2013 to £350m (from £400m). Valuation remains undemanding
We increase our DCF-derived price target to 265p (from 262p). The stock is trading on 0.8x
2013E BVPS. We reiterate our Buy recommendation, but remove Paragon from our Mid-Cap
Key Call list, due to a lack of near term catalysts.
-
European Morning Meeting Highlights 21 November 2012
UBS

250ish very long term resistance area.

PAG PARAGON

J P Morgan

Europe Equity Research
20 November 2012

Paragon Group Overweight
PARA.L, PAG LN

Full year profits modestly ahead of estimate, and a
substantially better dividend ▲
Price: 250p
Price Target: 290p
Previous: 225p
General Financials

Adj. EPS FY (p) 19.6 23.4 23.7 24.4 26.1
Bloomberg EPS FY (p) 19.30 23.00 - 24.70 26.10
DPS (Net) FY (p) 4.0 6.0 5.0 7.0 8.0
NAV/Sh FY (p) 247.6 266.6 284.4 284.6 303.2
Revenue FY (£ mn) 151 170 173 186 195
Pretax Profit Adjusted FY
(£ mn)
81 94 96 99 106
Adj P/E FY 12.7 10.7 10.5 10.2 9.6
Net Yield FY 1.6% 2.4% 2.0% 2.8% 3.2%
Source: Bloomberg, J.P. Morgan Cazenove estimates.

Company Data
Price (p) 250
Date Of Price 19 Nov 12
Price Target (p) 290
Price Target End Date 31 Dec 13
52-week Range (p) 257 - 151
Mkt Cap (£ bn) 0.7
Shares O/S (mn) 299
140
160
180
200
220
240
260
p
Nov-11 Feb-12 May-12 Aug-12 Nov-12

Price Performance

Paragon Group (“Paragon”) has this morning released its full year results
for the year to September 2012. The company has reported profits a touch
ahead of our estimate at £94.2m (our estimate £92.8m) and 16% higher
than a year ago. It has also announced a material change to its dividend
policy with the intention of targeting 3.0-3.5x cover over the medium
term. The immediate impact of this is a final dividend of 4.5p taking the
total dividend for this year to 6.0p, compared with our estimate of 4.4p. In
our view, the combination of having secured new funding this year and the
new dividend policy are confirmation of Paragon's recovery from the
travails of the credit crunch, and are likely to be well received by
shareholders. We have both rolled our price target forward to December
2013 and increased it to 290p reflecting the company’s return to lending.
We retain our Overweight recommendation.

 Underlying PBT £94.2m v our estimate £92.8m (2011 £81.1m). Q4
profit was £25.3m, 14% ahead of a year ago.

 The company reports that the pipeline of business at the start of the
year is strong supported by the recent securitisation and warehouse
facility. The company reports that to date there have been no arrears on
mortgage lending advanced since October 2010.

 We are making no change to our profit estimates at this stage
although the better than expected performance in 2012 increases
confidence. A lower tax rate implies modest EPS upgrades while we
have increased materially our dividend estimates to reflect the new
dividend policy. We also introduce our FY14 estimates.

 Our price target is rolled forward to December 2013 and increased
to 290p. In our view book value is a reasonable next base for the share
price.
 Analysts meeting 9.30am. 1 Finsbury Avenue, EC2M 2PP.

Closed today just off the Money for my Future position, fingers crossed for next week.

Im £1.90 pence up..he he. March contract.

Think its looking strong though shortie.

March contract also GF

27 Nov Paragon Group of... PAG Espirito Santo Execution Noble Buy 241.00 245.50 259.00 338.00 Retains

SP target 338p

Response to press speculation

The Paragon Group of Companies PLC ("Paragon") notes the recent press speculation and confirms that it is in the early stages of considering the acquisition of Hampshire Trust Plc, a wholly owned subsidiary of National Counties Building Society.
There is no certainty that a transaction will be concluded. Paragon will update the market when it is appropriate to do so.

Interesting. Bet they buy.

Small bank could be big deal for buy-to-let lender Paragon

Paragon Group, the buy-to-let lender cashing in on the decline in house ownership, is in talks to buy Hampshire Trust.

11:26
by Gavin Lumsden on Dec 03, 2012 at 10:32



Paragon Group (PARA.L), the buy-to-let lender cashing in on the decline in house ownership, is poised to become Britain's newest bank.

Responding to a story in the Sunday Times the company today confirmed it was considering buying Hampshire Trust, a small private bank owned by National Counties building society.

The acquisition would give Paragon a banking licence which it could use to offer savings accounts to its customers. As well as broadening its product range it would also give Paragon another source of funding for its mortgages.

Paragon mostly relies on wholesale markets for its mortgage funding. It was hit hard in the financial crisis but survived the credit crunch after raising money from shareholders in an emergency rights issue four years ago.

The news lifted Paragon shares nearly 2p to just over 242p. The shares have jumped 33% this year but are still well below their peak six years ago.

The shares are held by Jamie Hooper, manager of the AXA Framlington UK Growth fund, who recently told us he thought Paragon was riding a 'fantastic trend' in buy to let as people had to rent for longer before buying their own homes.

Last month Paragon reported full-year pre-tax profits had jumped 16% to £94.2 million. Chief executive Nigel Terrington said it had been able to grow through buying blocks of mortgages from the big banks that needed to scale down their borrowings


http://www.citywire.co.uk/money/small-bank-could-be-big-deal-for-buy-to-let-lender-paragon/a639334?ref=citywire-money-latest-news-list

Paragon: Acquisition of Hampshire Trust
Buy-to-let mortgage specialist Paragon Group [LON:PAG] has confirmed that it is in the early stages of considering the acquisition of Hampshire Trust Plc., a subsidiary of National Counties Building Society.

The announcement comes after reports in the weekend press.

Analyst Peter Lenardos at RBC Capital commented: “We believe this would diversify Paragon's sources of funding and make it less reliant on the wholesale funding markets.

“However, we note that there would be a duration mismatch as short-term deposits are used to fund longer-term mortgages.

“Until Paragon provides further details on the proposed transaction, there is no impact to our forecasts or price target.”

RBC Capital currently have a ‘sector perform’ rating on the stock and a price target of 260 pence.

Broker Forecasts three month consensus data highlights that 82 per cent of brokers have a buy recommendation on the stock, 9 per cent are recommending selling shares in Paragon with the remainder of brokers maintaining a neutral rating on the shares.

At 2:44pm: Paragon Group of Companies share price was +2.65 pence at 242.85 pence.

Looking good for another attempt at resistance, I've edged into profit today..!

Heading higher was Paragon, the buy-to-let lender. It added 1.8p to 242p after it confirmed reports it was seeking a banking licence with the possible purchase of Hampshire Trust, a private bank which offers loans and development finance. Espirito Santo said:


For Paragon the attraction is that the banking licence offers deposit accounts and savings bonds which Paragon could use as a source of retail funding. This would diversify Paragon's sources of funding and enable it to meet the demand it is experiencing from retail borrowers it has acquired through its recent portfolio acquisitions once they have repaid their loans – an opportunity management said they are currently having to turn down. Although this is still early stages, it does highlight managements proactive approach to increasing return on equity within the business and adds to our belief that there is significant value within the group.

PAG PARAGON

Breakout confirmed on the 48 hour
TA rule on this one. Excelent new 52
week
high...

Sold out and taken profit GF..

PAG PARAGON

This from Broker Berenberg this morning...

Paragon:
According to research by specialist mortgage broker Mortgages for Business, more
than 55% of landlords are looking to increase their property portfolios and over 40% plan to
remortgage over the next six months. The buy-to-let sector continues to see a modest recovery
stemming from attractive yields (6-7%) available on residential property investments as tenant
demand surges due to continued limited access to credit for first-time buyers. This will benefit
Paragon, which is looking to take advantage of this trend by more than doubling new lending to
c.£400m in 2013. The stock has re-rated sharply in last six months (up c.60%) and now trades on
a 2013 P/TBV of 0.9x for an RoTE of 9%.

PAG breakout..........

Broker note out late yesterday afternoon...

23 Jan Paragon Group of... PAG Canaccord Genuity Buy 273.05 270.30 313.00 313.00 Retains

313p SP TARGET.

Going very well now. think their is a trading statement tomorrow or early next week.

Interim Management Statement

The financial performance of the Group remained strong during the period to 31 December 2012, in line with management's expectations, generating operating profits (before fair value items) of £23.7 million, compared with £20.3 million for the corresponding period in the previous year, a 16.7% increase. Pre-tax profits, after a charge of £0.2 million for fair value hedging items, were £23.5 million for the period.


Trading

Redemptions across the loan books remain low and performance continues to be strong. At 31 December 2012 arrears over three months on the buy-to-let portfolio, including acquired loans and receivership cases, were 44bp, comparing favourably with 64bp of arrears at 31 December 2011 and with the 48bp of arrears at 30 September 2012. The credit performance of the consumer loan portfolios, including acquired portfolios, has been in line with management's expectations during the period.

During the quarter, £45.6 million of new buy-to-let loans and £0.5 million of further advances were made. At 31 December 2012 the pipeline of new business amounted to £102.7 million. The credit quality of the new lending business written in the period has remained excellent. Following the increase in funding capacity the Group has enlarged and extended its lending activities and we anticipate increased business volumes during the second quarter.

The loan portfolios acquired by the Group's investment division, Idem Capital since 2009 have continued to perform well. Since 1 October 2012, a further £36.7 million has been invested in portfolios of unsecured consumer loans. A number of opportunities for further investment are being considered, ranging from early stage portfolio analysis to cases where purchase negotiations are well advanced.

Cash generation from the Group's SPVs and from the acquired portfolios remained strong over the period. Free cash balances stood at £154.4 million at 31 December 2012, compared with £127.7 million at 30 September 2012.

Glad I sold out last week. Dont like late announcements, gives me the willys. More often than not something IS UP. This time looks like the bank takeover which has collapsed was the cause.

Trading looks solid mind.

Not for me ,but heres another midas tip -

MIDAS SHARE TIPS: Our buy-to-let Paragon tip soars 50% with more to go



By Simon Watkins, Financial Mail On Sunday

PUBLISHED:22:32, 23 February 2013| UPDATED:22:32, 23 February 2013

MIDAS followers who bought shares in buy-to-let lender Paragon last year are already sitting on a 50 per cent gain in just under five months. However, now is not the time to take profits as there is every sign the success will continue at least for the foreseeable future.


Paragon has thrived on the continuing boom in renting and seems to be continually seeking ways to raise new funds to keep on lending to landlords. Profits last year rose to £95.5million, up from £81 million the year before.


That helped the shares climb, and since September 30, 2012, when Midas tipped them at 206½p, they have risen to 312¾p. On top of that, Paragon has paid a final dividend of 4.5p a share, taking the year’s dividend to 6p.





Room to rent: The lettings market is booming

The group has benefited from the mainstream banks trying to reduce their loan portfolios and from the fact that many would-be homeowners are finding it hard to get on the property ladder, so spending longer in rented accommodation.


Those fundamentals look unlikely to change in the near future. Paragon is also well funded with £450million in facilities available from banks for more mortgage lending to customers.


The risk remains of a big downturn in the housing market, though that has so far not materialised, and Paragon has made great play of its high-quality lending. Its arrears rate (the percentage of mortgage holders behind in their payments by three months or more) was 0.48 per cent compared with a sector average of 1.5 per cent.


Paragon itself issued figures last week showing that landlords were making yields (the rental income as a percentage of the price of their property) of six per cent last year, suggesting there is plenty of life in the buy-to-let market yet. As ever, investors should keep a close watch on the housing market for signs of strain.


Paragon has also been looking at entering the banking market through acquiring a small bank or applying for its own licence to take deposits. If successful, that could push the group into a whole new field with huge potential, albeit with some new risks attached.


Meanwhile Paragon’s latest wheeze for raising cash to fuel growth was to issue a retail bond available to ordinary investors. The deadline for buying into the opening had been Tuesday this week but the strong uptake means the offer was closed early on Friday.






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The group raised £60million with a bond offering a coupon of six per cent and maturing in 2020. The terms were clearly more than enough to attract plenty of backers. If you missed the opportunity to buy into the bond – or the minimum commitment of £2,000 was too high for your taste – the shares still offer an attractive alternative.


Indeed, the ease with which Paragon attracted buyers for its bond is itself a vote of confidence in the group.

Midas verdict: If you bought Paragon shares at our tip price of 206½p in September you are sitting on a very healthy capital gain. On top of that the dividend represents a yield of three per cent – a respectable sum in the current climate – so hold.


If you did not buy then you could consider climbing aboard now. You may have missed the bond issue, but the shares could still provide a good return. At today’s price of 312¾p and given a forecast dividend of 7p this year the shares will deliver a two per cent yield with a realistic chance of some capital growth on top.


It is not such an attractive proposition as it was in September and at this price it is clearly riskier, but for those prepared for a little risk the shares are still a buy.

Half Yearly Report

Highlights

Financial Performance
· Profit before tax increased by 9.6% to £49.1 million (2012 H1: £44.8 million)

· Total operating income increased by 5.5% to £86.8 million (2012 H1: £82.3 million)

· Underlying profit before tax increased by 10.0% to £48.2 million (2012 H1: £43.8 million) †

· Earnings per share increased by 10.5% to 12.6p (2012 H1: 11.4p)
· Interim dividend increased to 2.4p per share (2012 H1: 1.5p per share) in line with dividend policy


Capital and Funding
· Strong operational cash generation: free cash balances £173.8 million at 31 March 2013 after investments (2012 H1: £104.9 million)

· Warehouse facilities increased to £450.0 million
· Successful securitisation of new buy-to-let loan assets

· Retail bond programme launched and successful first issue completed


Business and Operations
· £102.3 million of buy-to-let loans advanced (2012 H1: £89.2 million); pipeline at 31 March 2013 of £241.2 million; significant increase in lending expected in second half

· £57.6 million invested in consumer loan portfolios in the period

· Idem Capital established as one of the leading consumer debt buyers in the UK

† Note 7

PAG..... just gone long. Bullish engulfing candle on a line of support. Oscillators looking set to turn bullish aswel.

Stock looks far too cheap compared
to Broker SP TARGETS.........

Date Company Name Broker Rec. Price Old target price New target price Notes

22 May 13 Paragon Group of... JP Morgan Cazenove Overweight 304.95 300.00 361.00 Retains
21 May 13 Paragon Group of... RBC Capital Markets Sector Performer 304.95 370.00 - Reiterates
21 May 13 Paragon Group of... Shore Capital Hold 304.95 - - Retains
21 May 13 Paragon Group of... Canaccord Genuity Buy 304.95 350.00 390.00 Retains
21 May 13 Paragon Group of... Espirito Santo Execution Noble Buy 304.95 - 344.00 Retains


N@P Building Society

gf take care with that candle!

JP Morgan overweight TP 396p
housing/buy to let market picking up fast, results due November.
worth a look, dyor.

with buy-to-let booming alongside the property market in general, PAG must surely be worth investigating

the 6-month chart below is easy on the eye .....

Breakout at PAG. Long term chart aswel.

Financials doing well today, fundys cheap aswel historicaly.

Brokers have some hefty SP targets on PAG.

Date Company Name Broker Rec. Price Old target pric Newtarget price

11 Dec 13 Paragon Group Of... Canaccord Genuity Buy 360.50 420.00 420.00 Retains

10 Dec 13 Paragon Group Of... RBC Capital Markets Outperform 360.50 - - Reiterates

05 Dec 13 Paragon Group Of... Berenberg Buy 360.50 395.00 395.00 Retains

28 Nov 13 Paragon Group Of... Espirito Santo Execution Noble Buy 360.50 393.00 424.00 Retains

01 Nov 13 Paragon Group Of... JP Morgan Cazenove Overweight 360.50 396.00 - Retains

N@W Building Society

PAG PARAGON FUNDIES........

Date Rec Pre-tax (£) EPS (p) DPS (p) Pre-tax (£) EPS (p) DPS (p)

Peel Hunt LLP
23-12-13 BUY 110.41 27.34 7.80 118.38 29.23 8.20
Panmure Gordon [R]
23-12-13 BUY 29.70 8.50 33.80 10.00
Shore Capital
20-12-13 BUY 115.80 28.90 8.70 129.50 32.90 10.40
Westhouse Securities
19-12-13 BUY
Canaccord Genuity Ltd
11-12-13 BUY 122.00 29.20 8.00 135.00 33.00 9.50
Numis Securities Ltd
27-11-13 SELL 111.90 27.90 8.40 116.60 29.20 9.24

2014 2015
Pre-tax (£) EPS (p) DPS (p) Pre-tax (£) EPS (p) DPS (p)

Consensus 113.95 28.68 8.28 123.88 32.95 9.55
1 Month Change 5.51 0.60 -0.16 5.70 -0.62 -0.45
3 Month Change 4.88 -0.52 -0.16 2.50 -0.51 -0.45

GROWTH 2013 (A) 2014 (E) 2015 (E)
Norm. EPS 3.38% -11.49% 14.88%
DPS 66.26% 20.01% 15.32%

INVESTMENT RATIOS
2013 (A) 2014 (E) 2015 (E)
EBITDA £m £125.00m £143.00m
EBIT £m £m £m
Dividend Yield 1.88% 2.25% 2.60%
Dividend Cover 4.70x 3.46x 3.45x
PER 11.34x 12.81x 11.15x
PEG 3.35f -1.12f 0.75f
Net Asset Value PS p 311.20p 334.70p

Paragon Group of Companies PLC PT Raised to GBX 453 at Canaccord Genuity (PAG)
Posted by Wayne Rhoads on Feb 18th, 2014

Paragon Group of Companies PLC logoAnalysts at Canaccord Genuity upped their price objective on shares of Paragon Group of Companies PLC (LON:PAG) from GBX 420 ($7.04) to GBX 453 ($7.59) in a research report issued to clients and investors on Tuesday, Analyst Ratings Net reports. The firm currently has a “buy” rating on the stock. Canaccord Genuity’s target price points to a potential upside of 23.30% from the stock’s previous close.
PAG has been the subject of a number of other recent research reports. Analysts at Espirito Santo Investment Bank Research reiterated a “buy” rating on shares of Paragon Group of Companies PLC in a research note on Thursday, February 13th. They now have a GBX 481 ($8.06) price target on the stock, up previously from GBX 424 ($7.11). Separately, analysts at UBS AG raised their price target on shares of Paragon Group of Companies PLC from GBX 325 ($5.45) to GBX 350 ($5.87) in a research note on Monday, February 3rd. They now have a “neutral” rating on the stock. Finally, analysts at JPMorgan Chase & Co. reiterated an “overweight” rating on shares of Paragon Group of Companies PLC in a research note on Monday, February 3rd. They now have a GBX 396 ($6.64) price target on the stock. One investment analyst has rated the stock with a sell rating, three have given a hold rating and nine have assigned a buy rating to the company’s stock. The company currently has an average rating of “Buy” and an average price target of GBX 381.17 ($6.39).
The Paragon Group of Companies PLC is an United Kingdom-based holding company, engaged in the first mortgage and consumer finance businesses.

thanks to someone (sticky?) i bought some for my SIPP the other day at 358, so very many thanks to that benefactor

Latest Broker Views........

Date Company Name Broker Rec. Price Old target price New target price Notes

18 Feb 14 Paragon Group Of... Canaccord Genuity Buy 381.25 420.00 453.00 Reiterates
18 Feb 14 Paragon Group Of... Espirito Santo Execution Noble Buy 381.25 481.00 481.00 Retains
13 Feb 14 Paragon Group Of... Espirito Santo Execution Noble Buy 381.25 424.00 481.00 Retains
03 Feb 14 Paragon Group Of... RBC Capital Markets Outperform 381.25 - - Reiterates
03 Feb 14 Paragon Group Of... Jefferies International Buy 381.25 400.00 420.00 Reiterates
03 Feb 14 Paragon Group Of... JP Morgan Cazenove Overweight 381.25 396.00 396.00 Retains

Half Yearly report

Highlights
Strong increase in buy-to-let lending and Idem Capital investment levels. Banking subsidiary established
· £269.3 million of buy-to-let loans advanced (2013 H1: £102.3 million); pipeline at 31 March 2014 of £348.1 million; significant increase in lending expected in second half

· Idem Capital invested £121.9 million in consumer loan portfolios in the period

· Car Finance business launched by Paragon Bank PLC


The business produced underlying profits of £57.9 million for the period, a 20.9% increase, generating a 19.0% increase in EPS and a 25.0% increase in the interim dividend
· Underlying profit before tax increased by 20.9% to £57.9 million (2013 H1 (restated*): £47.9 million) †

· Profit before tax increased by 19.3% to £58.2 million (2013 H1 (restated*): £48.8 million)

· Total operating income increased by 11.3% to £96.4 million (2013 H1 (restated*): £86.6 million)

· Earnings per share increased by 19.0% to 15.0p (2013 H1 (restated*): 12.6p)

· Interim dividend increased by 25.0% to 3.0p per share (2013 H1: 2.4p per share) in line with dividend policy


To enable future growth, funding sources were diversified and expanded on improved terms
· Warehouse facilities extended on improved terms and increased after 31 March 2014 from £450.0 million to £550.0 million

· Paragon Mortgages (No. 19) PLC securitisation completed, with a broader investor base and on improved terms, funding new buy-to-let loan assets and refinancing a legacy deal, First Flexible No. 4 PLC, the first since 2007

· First structured funding of acquired Idem Capital assets completed

· Second issue under retail bond programme

· Banking licence granted to Paragon Bank PLC, retail deposit taking capability established

PAG got a lot going for it, as some resistance coming up pretty soon but if it gets through we should see a move for the high of the year at 425p. Some healthy brokerage following aswel

i've got these in my sipp from 358, so fairly happy

Results in the morning.

PAG

BEATS CONSENSUS Broker Figures easily......

2014 2015
Date Rec Pre-tax (£) EPS (p) DPS (p) Pre-tax (£) EPS (p) DPS (p)
Shore Capital
21-11-14 BUY 122.20 30.50 8.60 142.50 36.10 10.40
Panmure Gordon
21-11-14 BUY 31.20 8.50 35.70 10.00
Peel Hunt LLP
21-11-14 BUY 121.20 30.01 8.20 138.66 34.23 9.50
Westhouse Securities
20-11-14 BUY
Canaccord Genuity Ltd
29-10-14 BUY 117.00 29.90 9.00 141.00 35.50 10.50
Numis Securities Ltd
24-07-14 SELL 119.20 30.70 8.76 126.70 32.80 10.10
Espirito Santo Investment Bank Inc
02-04-14 BUY 114.90 28.90 8.40 120.30 30.60 9.50
2014 2015

Pre-tax (£) EPS (p) DPS (p) Pre-tax (£) EPS (p) DPS (p)
Consensus 120.68 30.28 8.58 140.40 35.30 10.13


Fantastic results and lets not forget the consensus figures were revised upwards on the IMS.

HIGHLIGHTS

Underlying profits increased by 18.1% to £122.2 million from £103.5 million in 2013


2014
2013
(restated*)
Change
% change
Profit before tax
£122.8m
£104.8m
+£18.0m
+17.2%
Basic EPS
31.9p
28.2p
+3.7p
+13.1%
Dividend per share
9.0p
7.2p
+1.8p
+25%
Dividend cover ratio
3.5 times
3.9 times


Return on equity
10.7%
10.1%


Cost:income ratio
32.0%
33.2%


* note 2

Strong progress in buy-to-let and debt purchase divisions. Banking franchise established. All divisions showing strong growth prospects

· Buy-to-let completions increased by 82.5% to £656.6 million (2013: £359.8 million); pipeline increased by 78.9% to £414.8 million (2013: £231.9 million)

· Idem Capital increased its investments, net of debt, by 89.3% to £175.7 million (2013: £92.8 million)

· Paragon Bank launched car finance, second mortgage and buy-to-let operations

Significant progress achieved in Group's funding diversification strategy

· Paragon Bank's retail deposit taking activities commenced in June 2014, with £60.1 million of deposits by the year end

· Second retail bond completed, taking cumulative issuance to £185.0 million

· Two bespoke financing packages, totalling £185.6 million raised to support Idem Capital

· Warehouse facilities for buy-to-let lending increased to £550.0 million

· Securitisation issuance totalled £929.7 million over the last 12 months

Capital management

· Strong increase of 20.2% in net cash generation to £157.8 million (2013: £131.3 million)

· Group capital ratios remain strong with Core Tier 1 ratio of 19.7% and leverage ratio of 8.3%

· 2014 dividend cover ratio at top of the targeted range of 3.0 to 3.5 times, two years ahead of expectations

· Initial £50.0 million share buy-back programme announced

Outlook

· Strong new lending and debt purchase pipelines, together with the development of Paragon Bank, present significant growth prospects

· Funding diversification programme and improving debt capacity underpin sustainable growth

· Shareholder returns enhanced by higher dividends and capital management programme

This Broker was looking for a 16% increase and we got a 17.2% increase year on year.

Tuesday 25 November

Paragon (PAG) will release its full-year results on Tuesday.

Analysts' expectations: Paragon's full-year results are expected to show both Mortgages and Idem Capital posting strong growth. Stuart Duncan at Peel Hunt reckons there could be a 16% increase in profits.

He anticipates "positive trends" in each aspect of the business, with expectations that "the Mortgage business [will] do £600 million of new completions, Idem [will] have completed further portfolio acquisitions, and the new bank to be making progress."

With Paragon currently trading at roughly 1.1x September 2015 forecast net asset value (NAV), he believes that this "undervalues the future growth in ROE (return on equity)", which is why he retains his 'buy' recommendation.

BRIEF – Paragon FY pretax profit up 17.2 pct
25 Nov 2014 - 07:45

Nov 25 (Reuters) – Paragon Group Of Companies Plc

FY pretax profit rose 17.2 percent to 122.8 million STG
Final dividend 6 pence per share
Total dividend 9 pence per share
FY basic EPS 31.9 pence
Strong new lending and debt purchase pipelines, together with development of paragon bank, present significant growth prospects
Source text for Eikon: ... Further company coverage: PARA.L

(Bangalore Newsroom: +91 80 6749 1136)

Keywords: PARAGONGROUPOFCOMPANIES/BRIE

sp still quite well short of its peak of about 420 reached in april this year

Yep plenty of manoeuvre space....

PAG

First of many Broker updates I reckon.......

25 Nov 2014 Paragon Group of... PAG Espirito Santo Execution Noble Buy 392.10 377.90 494.00 494.00 Reiterates

SP target 494p

25 Nov 2014 Paragon Group of... PAG Panmure Gordon Buy 392.10 377.90 500.00 500.00 Reiterates

500p SP Target.

25 Nov 2014 Paragon Group of... PAG Liberum Capital Buy 392.10 377.90 - 442.00 Reiterates

25 Nov 2014 Paragon Group of... PAG Canaccord Genuity Buy 394.05 377.90 453.00 453.00 Reiterates

25 Nov 2014 Paragon Group of... PAG Shore Capital Buy 401.05 377.90 - - Retains

IC TIP UPDATES:

Buy to let specialist and Simon Thompson recommendation Paragon Group of Companies (PAG) has issued a strong set of full year results reflecting ongoing buoyant trading conditions. Pre-tax profits rose by 17.2 per cent to £122.8m, allowing management to increase the dividend by 25 per cent to 9p a share. Buy to let completions in the year rose by 82.5 per cent and the forward order book is up 79 per cent to £415m. During the period the group also launching its own banking products and attracted £60.1m in deposits between June and September.

25 Nov 2014 Paragon Group of... PAG RBC Capital Markets Outperform 408.15 377.90 - - Reiterates

Strong performance boost Paragon FY results
Daniel Cancian | Sharecast | 25 Nov, 2014 08:11 - Updated: 09:31



First mortgages and consumer finance focused Paragon Group of Companies said strong performances across the board boosted its full year profit.
Profit before tax for the year ended 30 September rose from £104.8m to £122.8m, while underlying profit rose from £103.5m to £122.2m.
The group’s mortgages division saw an 82.5% increase to £656.6m in buy-to-let completions as the group broadened its distribution through its Paragon Mortgages and Mortgage Trust brands.
"The past year has seen considerable progress in the group's strategic plans and in the performance of its businesses,” Nigel Terrington, the group chief executive said.
“Paragon Mortgages and Idem Capital have witnessed significantly increased new business and are well positioned for further growth. Significant progress has also been achieved in diversifying further the group's funding sources.”
The firm added that the buy-to-let market continued to grow, supporting the private rented sector (PRS), which now accounts for 18% of the housing stock in England.
Paragon said that tenant demand strengthened throughout the year and recent forecasts suggested the PRS share of total housing stock would continue to grow in the future.
The group has proposed a final dividend of 6p per share compared to 4.8p per share in the previous financial year.
Existing businesses provided significant opportunities for growth and the potential to develop additional products.

the more i think about the more PAG is a really good buy, even now

the buy-to-let market is booming at the expense of outright sales for all sorts of fairly obvious reasons
i do not see this picture changing in anything like the near future

Paragon Group of Cos Reveals Share Buy-Back As Profit Jumps
LONDON (Alliance News) - Paragon Group of Companies PLC Tuesday reported a jump in full-year ...

Alliance News25 November, 2014 | 8:25AM
LONDON (Alliance News) - Paragon Group of Companies PLC Tuesday reported a jump in full-year pretax profit, driven by growth in its mortgages lending and investment divisions, helping it to launch a share buy-back programme and to raise its dividend.
In a statement, Paragon, which provides financing for buy-to-let mortgages as well as buying UK consumer debt, said it made a GBP122.8 million pretax profit in the year ended September 30, up from with GBP104.8 million in the prior year.
Paragon raised its dividend by 25% to 9.0 pence and said its share buy-back programme will initially be up to GBP50.0 million.
Paragon said its bank, which began taking retail deposits in June after receiving regulatory approval earlier this year, took GBP60.1 million in retail deposits by the end of the year. The group launched the bank in order to diversify its funding base, and wants to use it to finance an increasing proportion of buy-to-let business over time.
Although the bank reported a GBP6.4 million operating loss for the year, widening from GBP1.3 million in the prior year, that was more than offset by a rise in operating profit at Paragon Mortgages to GBP81.1 million, from GBP71.6 million, as well as a rise to GBP48.1 million from GBP34.5 million in investment division Idem Capital.
"Paragon Mortgages and Idem Capital have witnessed significantly increased new business and are well positioned for further growth. Significant progress has also been achieved in diversifying further the group's funding sources. In particular, the formation of Paragon Bank has provided us with the opportunity to diversify further both income streams and funding and we expect it to play an important role in the group's future plans," Nigel Terrington, chief executive, said in a statement.
Terrington said the dividend increase and the launch of the share buy-back programme are part of a move to improve shareholder returns as the group grows.
Paragon shares were up 4.1% at 393.40 pence on Tuesday, the best-performing stock on the FTSE 250.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
- See more at: http://www.morningstar.co.uk/uk/news/AN_1416903900092084200/paragon-group-of-cos-reveals-share-buy-back-as-profit-jumps.aspx#sthash.0E9wkhvK.dpuf

Shore Capital Reaffirms “Buy” Rating for Paragon Group of Companies PLC (PAG)
Posted by Shane Hupp on Nov 25th, 2014

Paragon Group of Companies PLC logoParagon Group of Companies PLC (LON:PAG)‘s stock had its “buy” rating reiterated by equities research analysts at Shore Capital in a research note issued to investors on Tuesday.
A number of other firms have also recently commented on PAG. Analysts at Liberum Capital reiterated a “buy” rating on shares of Paragon Group of Companies PLC in a research note on Tuesday. They now have a GBX 442 ($6.92) price target on the stock. Separately, analysts at Panmure Gordon reiterated a “buy” rating on shares of Paragon Group of Companies PLC in a research note on Tuesday. They now have a GBX 500 ($7.82) price target on the stock. Finally, analysts at Espirito Santo Investment Bank Research reiterated a “buy” rating on shares of Paragon Group of Companies PLC in a research note on Tuesday. They now have a GBX 494 ($7.73) price target on the stock. One investment analyst has rated the stock with a sell rating, one has assigned a hold rating and eleven have given a buy rating to the company’s stock. Paragon Group of Companies PLC currently has an average rating of “Buy” and an average target price of GBX 419.50 ($6.56).
Shares of Paragon Group of Companies PLC (LON:PAG) opened at 407.00 on Tuesday. Paragon Group of Companies PLC has a 1-year low of GBX 313.70 and a 1-year high of GBX 426.10. The stock has a 50-day moving average of GBX 349.4 and a 200-day moving average of GBX 350.2. The company’s market cap is £1.243 billion.
The Paragon Group of Companies PLC is an United Kingdom-based holding company, engaged in the first mortgage and consumer finance businesses.

BROKER BUYS FOR PAG TODAY.........

Date Broker Rec. Price Old target price New target price Notes
25 Nov 14 RBC Capital Markets Outperform 408.05 - - Reiterates
25 Nov 14 Shore Capital Buy 408.05 - - Retains
25 Nov 14 Canaccord Genuity Buy 408.05 453.00 453.00 Reiterates
25 Nov 14 Espirito Santo Execution Noble Buy 408.05 494.00 494.00 Reiterates
25 Nov 14 Panmure Gordon Buy 408.05 500.00 500.00 Reiterates
25 Nov 14 Liberum Capital Buy 408.05 - 442.00 Reiterates

PAG got a lot going for it, as some resistance coming up pretty soon but if it gets through we should see a move for the high of the year at 425p. Some healthy brokerage following aswel

PAG Consensus recommendation

As of Nov 22, 2014, the consensus forecast amongst 25 polled investment analysts covering Paragon Group of Companies PLC advises that the company will outperform the market. This has been the consensus forecast since the sentiment of investment analysts improved on Feb 26, 2013. The previous consensus forecast advised investors to hold their position in Paragon Group of Companies PLC.

http://markets.ft.com/research/Markets/Tearsheets/Forecasts?s=pag:lse

26 Nov 2014 Paragon Group of... PAG JP Morgan Cazenove Overweight 408.45 406.90 420.00 420.00 Retains

26 Nov 2014 Paragon Group of... PAG Barclays Capital Overweight 407.45 406.90 - 445.00 Reiterates

PAG

From The FT......

Paragon buoyed by buy-to-let market
Emma DunkleyAuthor 26/11/2014


Paragon Group, the specialist lender, said profits had reached a record level this year as the growth of the buy-to-let market in the UK gathered pace.
The group said underlying pre-tax profits rose 18 per cent to £122m for the year ending September 30, up from £104m last year.

Profits were buoyed by the group widening its distribution of buy-to-let loans across its Paragon Mortgages and Mortgage Trust brands, which helped spur an 82.5 per cent increase in buy-to-let completions to £656.6m.
Nigel Terrington, chief executive, said there was “ongoing demand” for rented property and that Paragon was “in the thick of it”.
“There are more people renting than in the past,” he said. “This has also been compounded by the Mortgage Market Review coming in. The likely reduction of available finance to homeowners pushes up more rental demand.”
Savills, the estate agent, forecasts the UK private rental sector will grow to represent 24 per cent of total housing stock over the next five years, up from 18 per cent at present.
Idem Capital, the specialist debt purchasing division of Paragon, also contributed positively to profit growth, increasing its investments net of debt by 89.3 per cent to £175.7m.
Mr Terrington said large banks will increasingly offload their non-core divisions and that bid-offer spreads have narrowed on these assets because of a better funding environment, meaning non-core portfolios are now more likely to sell.
Paragon’s profits would have been higher had it not been for a £6.4m loss as a result of costs associated with establishing its new bank, which launched in February.
“But we’re not trying to challenge major UK banks; we’re a specialist lender,” said Mr Terrington. “We have no plans for branches or current accounts, as we focus on narrow areas where we think we can do things better than others.”
The bank offers a range of savings products and loans for consumers and small businesses and was initially injected with £12.7m of capital from Paragon Group.
Paragon bank started taking retail deposits in June and gathered £60.1m by the year-end.
The group said its capital position remained strong, with a core tier one ratio of 19.7 per cent and a leverage ratio of 8.3 per cent.
Paragon has also announced an initial £50m share buy-back programme to help improve shareholder returns, Mr Terrington said.
Dividend payments for the year will increase 25 per cent to a total of 9p as a result of the profit increase, the group added.

By Emma Ann Hughes | Published Nov 25, 2014
Paragon buy-to-let completions up 82.5%

Buy-to-let completions at Paragon rose 82.5 per cent to £656.6m for the year to the end of 30 September 2014.

Today (25 November), Paragon reported a lending total of £500,000 by Paragon Bank for the 12 months to the end of September, which commenced its buy-to-let operations during September 2014.

The indexed loan-to-value of the overall buy-to-let portfolio stood at 71.7 per cent at 30 September 2014 compared with 78.4 per cent at the end of 2013.

Annualised redemption rate on the total buy-to-let portfolio was 4.1 per cent in 2014 compared to 2.5 per cent in 2013, reflecting increased housing market activity.

Paragon Mortgages maintains a significant presence for the group in this growing sector of the UK mortgage market, contributing £80.5m to underlying group profit, a 14.5 per cent increase.

The aggregate new business pipeline stood at £414.8m at the year-end, 78.9 per cent above the level at 30 September 2013, underpinning strong growth rates into the new financial year.

Nigel Terrington, chief executive of Paragon, said: “The past year has seen considerable progress in the group’s strategic plans and in the performance of its businesses. Significant progress has also been achieved in diversifying further the group’s funding sources.

“In particular, the formation of Paragon Bank has provided us with the opportunity to diversify further both income streams and funding and we expect it to play an important role in the group’s future plans.

“The group benefits from a strong capital position and I am pleased to announce a 25 per cent increase in the dividend, as well as an initial £50m share buy-back programme, as we seek to complement strong and sustainable growth with improving shareholder returns.”

emma.hughes@ft.com

7 Nov 2014 Paragon Group of... PAG Berenberg Buy 414.05 403.10 450.00 450.00 Retains

SP target 450p

PAG Paragon .....

.hTTp://www.cityam.com/1416967256/paragon-banks-shift-home-owning

Buy-to-let baby boomers to become Britain's latest tax victims
Withdraw your pension to buy a second home and face punishing tax hit

By Anna White, Property correspondent2:30PM GMT 30 Nov 2014 Comments51 Comments
Enterprising baby boomers who choose to withdraw their pension in a lump sum to invest in a rental property will face a tax bill worth hundreds of thousands of pounds.
After the annuity reforms come into effect in April 2015, that will allow people to withdraw their pension in one go instead of being drip fed an annual income, it is likely many pensioners will consider sinking it into property. But they need to think twice, experts at PwC have warned.
An individual taking out £500,000 to buy a £750,000 second home, supplemented by a mortgage, will have to find nearly £200,000 to cover the tax bill.
A pensioner withdrawing £200,000 to buy a £500,000 home - around the average asking price of a home in London - will pay around £80,000 in tax, according to the giant accountancy firm.
While those who draw back a £100,000 lump sum to buy a £250,000 will pay between £29,000 and £36,000 dependend on tax code


A individual who wants to fund a buy-to-let project is hoping for house price appreciation over time and an income from the yield. However, the whole transaction could be taxed at as many as five different junctures.
They will face income tax when the amount is withdrawn, stamp duty on buying the property, income tax on the rental stream, plus capital gains tax if sold. And inheritance tax could eventually play a part, explained Iain McCluskey, tax director at PwC.
"The reforms to annuity are net positive for the Chancellor," he said.
The over 55s, known as the baby boomer generation, are comfortable with property as an investment having made 200pc house price appreciation in 20 years.
This and the UK's historically low interest environment will drive people to put their savings and pension into property, Mr McClusky added.
"While this generation trusts investments that you can see and touch they should also be wary of the extra costs on top of tax, such as maintenance of a property. They must exercise caution when taking out one lump sum and understand tax circumstances in one year."



So complicated are these latest tax reforms that the Government is providing a free tax advice service, face-to-face, over the phone and via a website, to help people choose the right pension product.
However, income tax relief on a quarter of a pension pot means that those with a big enough sum could use the first 25pc for a deposit to buy a home, with a mortgage, and avoid the first income tax hit, alhtough getting a big mortgage becomes far harder at this stage in life.
PwC does not expect further property tax announcements in this week's Autumn Statement.
"There is too little time to implement any fundamental reforms ahead of the general election," said Alex Henderson, head of tax at PwC.
However, leading property group, JLL, is calling for an overhaul of the council tax system and for Government to address the UK's housing shortage.

LATEST BROKER VIEWS

Date Broker New target Recomm.
1 Dec HSBC 410.00 Neutral
27 Nov Berenberg 450.00 Buy
26 Nov Numis 289.00 Sell
26 Nov Canaccord... 495.00 Buy
26 Nov Barclays... 445.00 Overweight
26 Nov JP Morgan... 420.00 Overweight
25 Nov RBC Capital... N/A Outperform
25 Nov Shore Capital N/A Buy
25 Nov Canaccord... 453.00 Buy
25 Nov Numis 244.00 Sell
Broker Recommendations for Paragon Group of Companies (The)