I Read The News Today Oh Boy! 14-Dec-2017

14th Dec '17 by matylda

18 comments 5526 reads

Morning All!

Altitude ( Altitude (LON:ALT) ) – 69.7p – £35.4m – PER 18.4

Can’t work out if this latest update is good news or bad news. Fundamentals look OK but on a PER of 18.4, I’m not interested any further here at present.

Huntsworth ( Huntsworth (LON:HNT) ) – 81.75p – £269.9m – PER 13.3

Trading Update For The 11 Months To End November 2017 – Growth has been strong and expects to “reach at least market consensus”, which is £22.8m PBT. Net Debt is up, it seems from about £30m last time to about £45m now. Outlook is confident.

Doubled in 2018 this still looks reasonable attractive but probably priced about right. Will keep an eye on updates.

Tribal ( Tribal (LON:TRB) ) – 79.22p – £155.3m – PER 23.9

Trading Update – Great headline “Board anticipates that Group revenues will be slightly ahead of expectations and the financial performance of the Group will be materially ahead”. This is good too – “Balance sheet remains strong, with no long-term debt. As previously indicated, the Group anticipates ending the year with a larger cash balance than reported in 2016”.

Looks all round OK here. I guess the main thing putting me off is the PER of 23.9 – I want to invest here but I just can’t bring myself too at this price. Decided to put it on the Watchlist, somewhere around the 70p level.

Tungsten ( Tungsten (LON:TUNG) ) – 59.13p – £74.5m – PER n/a

Results For The 6 Months To End October 2017 – Revenue up 10% with a statutory loss of £8.5m versus a loss of £4.5m last time.

I’m just not interested here. But, IF forecasts are to be believed - It should have enough Cash to see it through to profitability (for the first time) in 2019.

Severfield ( Severfield (LON:SFR) ) – 73p – £218.7m – PER 11.1

Awarded Landmark Contract For Google's UK Headquarters – “This contract win adds to our recently announced strong order book of…

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MrContrarian

14th Dec '17

My morning smallcap tweet:

Altitude (LON:ALT), Huntsworth (LON:HNT), Omega Diagnostics (LON:ODX), Severfield (LON:SFR), United Carpets (LON:UCG)

Altitude Group (ALT) mild warning: "[the] decision to focus and invest in the people and technology required to deliver the AiM growth opportunity in the US has marginally impacted revenue expectations in 2017. The profit, despite the lost contribution attributable to the delay in completion of the ADP acquisition and the significant investment in the US, remains broadly in line with market forecasts."
Huntsworth (HNT) guides FY of at least market consensus headline pretax estimates - £22.8m.
Omega Diagnostics (ODX) CEO kicked upstairs to be 'Global Ambassador- Life President' of this £26m colossus. COO becomes CEO. Poor H1: adj EPS halves to 0.3p. ""Our food sensitivity business remains a key growth driver for us and it is clear that long term opportunities remain, particularly in the US where we now have three partner companies. Certain growth initiatives are taking slightly longer to bear fruit and thus, we now anticipate a slower build up in revenue in this and the next financial year...Whilst we are experiencing a number of short term headwinds in our core business, we believe that the impact will be more than mitigated by the success we expect from positive achievements over the medium term as we complete the commercialisation of key products for Allergy, Malaria and now CD4." Aren't the new products already in the price though?
Severfield (SFR) wins 16000T order for structural steelwork services for a new King's Cross office. The fact it's Google's UK headquarters seems to make it a better order.
United Carpets Group (UCG) H1 LFL sales up 3% but EPS down to 0.57p (0.66p). "Investment to support the Group's online activities and Beds operation reduced profits slightly in the first half although this is being offset by operational actions that are already beginning to bear fruit in the second half. " Curr trading: "October was similar to the first half before improving strongly in November"

Tortoise investor

Better than expected results I thought from United Carpets (LON:UCG) especially given the difficulties reported at Safestyle UK (LON:SFE) earlier this week. It is only trading at c. 5.7 PER (before markets open) which looks like v good value when coupled with a good dividend. I hold. I probably wouldn't want to pay more than a p/e of 8 in current economic climate though especially as it is quite illiquid.

LeoInvestorUK

Tungsten (LON:TUNG) have said:

"Over the first four months of the 2018 calendar year we expect to achieve overall EBITDA breakeven in each month, with slight variances dependent on the timing of new customer sales."

As they have no debt or major investment plans I think this means they will also be at cashflow breakeven.

The implication is of positive EBITDA from May 2018 and maybe even profits / positive cashflow in H1-FY2019 (to October 2018) and FY 2019.

Which is what matylda said, but I think the detail sounds a bit more positive.

More growth is required to benefit from the high gross margin but growth rates have been disappointing.

Ramridge

Titon Holdings (LON:TON) have produced decent full year results beating broker forecasts.

doug2500

An in line trading update from Advanced Medical Solutions (LON:AMS) - probably not enough to sustain the current share price, wouldn't be surprised to see it drift a small bit.

Zotefoams (LON:ZTF) investing in increased capacity - they sound confidant of increasing demand

Gostevie

Nice honest comment in the Byotrol (LON:BYOT) interims today:

We recognise that we remain something of a jam-tomorrow stock, with financial progress still partially reliant on one-off technical development and exclusivity fees.

https://www.investegate.co.uk/...

Disc: I no longer hold shares in Byotrol

fwyburd

Hi Matylda, I hope you don't mind me reminding readers about my Market Sentiment poll. The form is here

https://voxpops.typeform.com/to/j2nOfY

Ive had 67 responses to date and am keen to get this over 100 so I can do the analysis.

Cheers (or should that be cheese?)

Francis

matylda

Not at all, it's not my thread, it's the community's.

I have filled it it by the way!

ps - A fun one for the winner of The Apprentice perhaps!!!!!

nicobos

Tungsten (LON:TUNG) is a serial disappointer and they have over-promised before...

I'd wait for a trading statement mid-next year before making a purchase ! (even if you have to buy-in at a higher price).

Well Tungsten (LON:TUNG), without upgrades, 2019 is £45m Rev and PBT of say £0.7m - Valued at £75m now!

Thanks Matylda, you have a very responsive readership - 10 more surveys compIeted!.
Francis

jonno

Hi Matylda

Like you I think Severfield (SFR) looks interesting. The fact that it is cyclical will no doubt temper many investors enthusiasm, but it is in recovery mode and appears to be on a roll with cash equal to be about 20% of market cap and brokers gradually upgrading guidance. There is also a decent well covered dividend. I currently hold a small positon and will likely add. If I like a stock and am contemplating buying I am reminded of the comment by Peter Lynch that you should not nickel and dime a stock, in other words buy it assuming of course it is reasonable value on your investment metrics.

I very much look forward to reading your update each morning it often highlights investment opportunities that I may otherwise miss.

All the best

Jonno

Thanks for the comment and kind words.

Cyclical yes, but is infrastructure spending about to stop? Can it? I am more optimistic than pessimistic on this and will keep an eye on this for a potential entry - At what, as you say I consider "reasonable value".

andrea34

Re. Severfield (LON:SFR), my own view is that they are smashing value even at 75p, and a P/E of only around 10...

...whereas I agree that Tribal (LON:TRB) look rather over-valued, especially as they look to be in early-recovery mode, despite the upbeat announcement.

Agreed on both counts.

ISAallowance

Dialight (LON:DIA) have released a fairly shocking trading update in the middle of the day, down about 20%. Production volume shortfalls mean that a significant number of orders are unlikely to be fulfilled in this financial year.

AnonymousUser252054

Severfield (SFR) wins 16000T order for structural steelwork services for a new King's Cross office. The fact it's Google's UK headquarters seems to make it a better order.

Cash in hand job, maybe? : )

Robert Smith

Gosh, you are cynical!

I Read The News Today Oh Boy! 14-Dec-2017

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Matylda

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