Zytronic trending upwards

7th Sep '17 by fishmonkey

5 comments 3604 reads

I have held @ZYT since 2014 and decided to sell about 3 months ago after banking some nice capital and dividend earnings. However, annoyingly the price has still continued to rise (as often happens unless I decide to hold).

I have continued to watch this company as I love it. It has a huge amount of cash sitting on its balance sheet. It has grown its dividend year on year and is nicely covered. It has a decent ROCE and most importantly its in a 'sexy' area. Right now touch screen tech is very in vogue and also even if things go sideways it would be a prime candidate for a take over.

What I cannot understand is why it has made such huge gains over the last 3/12. Even today it has gone up by 8% on the back of no news that I can see.

I would love to hear opinions on this one and if you think this has got more to go?

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willhampson

7th Sep '17

Hey fishmonkey, Naked Trader updated his blog today (http://nakedtrader.co.uk/) and noted he had bought some more. He has a big following so I suspect that counts for a fair part of today's increase.

fishmonkey

Thanks for the link. Quite a following to make it jump like that. @ZYT tends to just bumble along up and down with a gradual move upwards.

I'm also super interested what they will be doing with the cash, I would prefer a special divi but would like them to grow the business ideally.

doug2500

Funny, I was just wondering myself what was driving it upwards tonight.

I concluded that:
A) The end of year is the end of this month and there's possibly expectation of good results. We won't know for sure until an update in october (assuming last years timescale)
B) It's still not expensively rated if you adjust for the cash pile. So even if A above doesn't pan out, it should still be okay.

RichardEllis

2nd Oct '17

Re the upward trajectory of ZYT it must be due to institutional buying. Their web-site lists the major interests & I note a number of significant institutional investors as of Jun 30 2017 eg Allianz. Unfortunately I am not aware when those investments were made so it hard to prove my theory.

jonno

3rd Oct '17

Robbie Burns, aka the Naked Trader can have a significant influence on the price of small caps. For example look at how share price of Flowtech Fluidpower took off after he bought into the stock recently. He is an astute stock picker using fundamentals and momentum and eschews blue sky and heavily indebted companies. His book the Naked Trader is worth a read. He updates his trades every other Thursday on his website:

www.nakedtrader.co.uk

The next update is due this Thursday. Worth a look I would suggest. No doubt the market makers will also be watching.

Best wishes

Jonno

Zytronic trending upwards

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Fishmonkey

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