Good morning/afternoon! Running a bit late today, due to the rip-roaring success of our Brighton ShareSoc investor evening last night. Thank you to everyone who came along, I'm sure everyone would agree that it was an interesting, friendly, and fun evening. My thanks also go to John McArthur of Tracsis (LON:TRCS), who gave a very interesting talk, not just about his company, but also about his impressions of AIM generally.

Some very useful tips in there about how to interpret trading statements, and the importance of reviewing the major shareholder list to look for shrewd Institutions - they've done the research for you, is his argument, something I agree with providing you follow the right ones! Not all Institutions are shrewd - some make remarkably bad decisions, and it can be their clumsy selling that hands us bargains on a plate!

This is particularly relevant, as Stockopedia are close to launching a new Ownership Module, which will be an add-on, giving analysis of major shareholders, and what particular fund managers are doing, etc. I've seen some previews of it, and it looks fantastic, I genuinely cannot wait to get my hands on it!

 

 

 

Volex (LON:VLX)

This is the electrical cables manufacturer. I dumped my shares in Volex in Nov 2013, because their interim results were far worse than I had expected - turnover was down 21.2% to $196.5m, and underlying profit was only $0.1m, so efffectively just at breakeven. Also, net debt had shot up to $41.4m, and it seemed obvious to me that the company would need to raise fresh share capital to reduce net debt. The company denied this, saying that their finances were fine. Then shortly afterwards in Dec 2013, they did raise some extra cash in a small Placing!

Based on their Edison forecasts, the company looked set to breach, or at lease come very close to breaching their net debt to EBITDA covenant. Hence I was very happy to exit from this share, which is now too high risk for me.

It seemed astonishing to me that the market brushed aside all these concerns, and the share price went back up to the 110-120p range, as if nothing had happened. People just ignored what were far worse interim results than expected. Apparently…

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