First Group FGROF
June 13, 2019 - 5:16pm EST by
2019 2020
Price: 99.55 EPS 0 0
Shares Out. (in M): 1,215 P/E 0 0
Market Cap (in $M): 1,209 P/FCF 0 0
Net Debt (in $M): 0 EBIT 0 0
TEV ($): 0 TEV/EBIT 0 0

Sign up for free guest access to view investment idea with a 45 days delay.

  • promotional write-up
* Idea not eligible for membership requirements


I do not hold a position with the issuer such as employment, directorship, or consultancy.
I and/or others I advise do not hold a material investment in the issuer's securities.


Coast Capital has stated that they plan on improving First Group through their value creation plan that they have carefully crafted (As seen on

1. Appoint Experienced Board and Management
·   Stock has lost 25% of value during average board tenure
·   Current directors: NO surface transport experience
·   Coast Proposed Board: 7 of 12 board members have relevant transportation, surface transportation, and turnaround experience

2. Commitment to Separate US and UK Assets
·   US assets can fetch up to 12.5x EBITDA
·   Separation can release over £3+ billion in capital
·   End negative operating synergies

3. Optimize Pension Plan, Reduce Debt
·   Leading pension fund consultant has developed a detailed plan to untangle pension plans with de-minimis top-up payments
·   Reduce gross debt by up to £1 billion
4. Initiate a Dividend & Buyback Program
·   FirstGroup is FCF positive, has reached peak de-levering capability, and can pay a modest dividend (all peers do)
·   Many UK funds require dividends to invest
·   Initiate a buyback program at to take advantage of stock at attractive prices

5. Asset Value Release
·   Up to £3 Billion in equipment can be sold and leased back!!!
·   £390 million in Real Estate (mostly acquired in the 70’s and 80’s, carried at BV) can be worth much more (5X? 10X? 20X? !!!)

    sort by    
      Back to top