Small Cap Report - STAF, NPT

Monday, Jan 07 2013 by

Good morning! Here is my usual trawl through the morning's RNSs, looking for the undervalued and overlooked.

Staffline (LON:STAF)

Recruitment/outsourcing group Staffline (STAF) has issued a short & sweet trading statement, saying that 2012 earnings will be in line with market expectations. They reiterate they are, "well placed to continue to capitalise on a number of strategic opportunities that exist across our business", the biggest one of which is the  Govt's welfare to work programme (which could become pretty lucrative for STAF in the next 5 years).

Morningstar shows the broker consensus EPS as 33.6p for 2012, so that puts STAF on a fairly cheap PER of 8.9 times 2012 earnings. There is also a 8.3p forecast divi, giving a yield of 2.8%. So it's no longer amazing value, but certainly good value. However, if EPS grows as forecast to 40p (with a 9.5p divi) then the 2013 forecast PER falls to 7.5, and the yield rises to 3.2%, which is looking a lot more interesting.

STAF has been heavily tipped by the Mail on Sunday, so I suspect that pulled in a lot of the recent buyers, so personally I shall sit this one out, and look to buy back in any significant pullback to say the 260-270p area.

On 4 Sep 2012 I published a report here following a private client broker lunch I attended with Staffline's Directors, and was very impressed. I bought shares at 226p, although have recently sold them at c.300p, in order to recycle the money into something that hasn't yet moved up (Vianet), but looks like it will once the overhang from a large seller is cleared.

Incidentally, I also made Staffline the "share of the month" for Sep 2012 on my sister site, Small Cap Value, which I'm pleased to say is now up & running again after some major IT problems (had to recreate the website from scratch, but have installed proper automatic backups now, so should be fine in future).

NetPlay TV (LON:NPT)

Netplay TV (NPT), the interactive gaming company, puts out a strong Q4 & full year trading statement, indicating that they are confident of exceeding full year market expectations. So that means they should deliver over 1p EPS for 2012, therefore these look potentially good value at 12.2p.

They note that mobile/tablet is a strong area of growth (isn't it everywhere?!).
I'm not terribly keen on gaming companies, as they are essentially preying on people with addictive personalities, so it's not for me. But purely based on the numbers it looks like a potentially interesting growth company.

OK, that's it for today. Not much else to report, other than that my training runs for the Brighton Half Marathon on 17 Feb are going well - am going out 3 or 4 times per week now, and managed about 5 miles last night with relative ease. Thank you to everyone who has sponsored me for either MacMillan cancer care, or the Sussex Beacon charities. The Justgiving link is here if you wish to donate. I'm at 59% of target funds raised so far ...

Also, I'm doing the DryAthlon for Cancer Research, which is to renounce alcohol for the whole of January. People who know me acknowledge that I (harrumph, coughs!) enjoy a drink occasionally, but so far so good. If you fancy sending me a virtual diet coke (for the benefit of Cancer Research), then please click on this different Justgiving link. Thank you to "Ajay" who kindly donated £20, much appreciated!

Have a good week!

Regards, Paul.

Filed Under: Smallcaps,

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Staffline Group plc is a United Kingdom-based holding company. The Company is engaged in the provision of recruitment and outsourced human resource services to industry and services in the welfare to work arena. The Company has two material operating segments which include the provision of temporary staff to customers and the provision of welfare to work, and other training services. The Company’s 100% equity subsidiaries include Staffline Recruitment-Recruitment, Elpis Limited-Dormant, A La Carte Recruitment Limited-Dormant, Staffline Polska Sp. Zoo-Recruitment, Staffline Gliwice Sp. Zoo-Recruitment, Go New Sp. Zoo-Recruitment, House of Logistics Limited-Dormant, Staffline Recruitment Limited-Recruitment, Eos Works Limited-Welfare to work, Ethos Recruitment Limited-Dormant, Taskforce Recruitment Limited-Dormant, Go New Recruitment Limited-Dormant, Go New Recruitment (Glos.) Limited-Dormant, Select Appointments Limited-Recruitment, Learning Plus System Limited-Training. more »

Share Price (AIM)
0.0  0.0%
P/E (fwd)
Yield (fwd)
Mkt Cap (£m)

NetPlay TV plc., is a United Kingdom-based interactive TV gaming company. The Company is engaged in creating games as well as creates TV show formats. The Company offers TV bingo, live blackjack, televised fixed odds draws, and mobile quiz games. The Company aims to deliver interactive gaming experience to the mass market. The Company combines Internet with the medium of TV to deliver interactive gaming experiences to the customers. The Company develops and markets a range of mass-market entertainment and information products through Interactive voice response, Short Messaging Service, online and offline. The interactive services offered are:, gaming experience online with casino-certified equipment and broadcast Live Roulette and blackjack games, and, is broadcast live and allows players to place bets online via your home phone and mobile phone and see their name appear on screen. more »

Share Price (AIM)
0.3  2.7%
P/E (fwd)
Yield (fwd)
Mkt Cap (£m)

  Is Staffline fundamentally strong or weak? Find out More »

1 Comment on this Article show/hide all

StrollingMolby 7th Jan '13 1 of 1

I bought shares at 226p, although have recently sold them at c.300p, in order to recycle the money into something that hasn't yet moved up (Vianet), but looks like it will once the overhang from a large seller is cleared.

You must have published this minutes before Vianet (LON:VNET) started moving today, up 15p to 118p, on news that New Solera had reduced to sub-3%.  Thanks for your research posted on this elsewhere, which led me to DMOR and buy at 102.5p on New Year's Eve.  Onwards and upwards from here...


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About Paul Scott

Paul Scott


Paul trained as an accountant, then spent 8 years as FD for a ladieswear retail chain.He became a professional small caps investor in 2002 to date.Paul writes a small caps report for on weekday mornings. He joined Fundamental Asset Management Ltd as a research associate in 2014, as part of their Small Cap Value Portfolio team. more »

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