Some user feedback yesterday suggested that I put my thoughts on their own thread. I had been wary of doing this as it could lead to discussion of the same stocks and news in different places but here goes.

First, notice that there is a vast number of resources stocks making announcements this morning. I tend to avoid this sector. It has not been a happy hunting ground for many private investors and the companies here are extremely difficult to value. Which just leaves two companies posting anything that caught my eye:

1) Matchtech (LON:MTEC)
2) Rotala (LON:ROL)

Matchtech (LON:MTEC) have a trading statement out:
http://www.investegate.co.uk/matchtech-group-plc--mtec-/rns/pre-close-trading-update/201408070700114714O/
"results now expected to be slightly ahead of current market expectations"

the statement is a great example of how well things can go for a company addressing a cyclical market when things pick up.

" Strong cash conversion, with Net Debt of £3.0m (2013: £10.6m)"

then you get the virtuous circle, where lower debts can lead to reduced financing charges:

"new agreement is for a three year, £60m Invoice Financing Facility, at a lower rate of 1.1% over HSBC bank base rate"

While I have called Matchtech (LON:MTEC) an operator in a cyclical industry, it is clearly well run, evinced by the fact that it remained profit making throughout the recession and did not cut its dividend. Stockopedia data has the shares on a forward P/E of 16.2 with an expected dividend yield of 3.3%.

Now Rotala (LON:ROL), which is a company that I confess I knew nothing about before this morning, a bit embarrassing as it has been listed on AIM for nine years.

The company "provides a range of transport solutions, from local bus services under contract to local authorities, to commercial bus routes"

and there is a history of such firms doing well on AIM. The company has issued its half-year numbers this morning:
http://www.investegate.co.uk/rotala-plc--rol-/rns/half-yearly-report/201408070700074435O/


Profit before taxation up 12% to £1.055 million (2013: £0.946 million) on marginally lower revenues Interim dividend increased by 18% to 0.65p per share (2013: 0.55p) Strong balance sheet with net assets per share up 8% at 69p per share (2013: 64p)

which is obviously very pleasing. Stockopedia has the shares on a forward P/E of 10.3…

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