I Read The News Today Oh Boy! 31-Jul-2018

31st Jul '18 by matylda

4 comments 1874 reads

Morning all!

Water Intelligence ( Water Intelligence (LON:WATR) ) – 388p – £59.1m – PER 41.8

Trading Update For H1 2018 – “Strong Trading Growth; Significant Profits Growth” is the headline. I like this statement “The Group's first half performance continues its upward growth path with the delivery of strong trading results and the execution of corporate development transactions to sustain such trading results into the future”.

I hold here and although it seems that price has now caught up with valuation somewhat, based on these numbers and comments - I will continue to hold for now.

As always, all comment most welcome!

Unlock with Email

Unlock with Google

Already have an account?
Login here

About the Author

Matylda

Premium Member

4 comments

MrContrarian

31st Jul '18

My morning smallcap tweet:

IDE Group (LON:IDE), Immedia (LON:IME), Fox Marble Holdings (LON:FOX)

IDE Group Holdings (IDE) rescue fundraising to raise up to £5.5m. £0.5m Firm Subscription at 2.5p (59% discount), conditional subscription for £2.7m, excess entitlement open offer for up to £0.5 and £1.8m of convertible loan notes.
Immedia Group (IME) has now signed the final terms of a 'major' contract (as previously mooted) for live radio to a major UK high street financial institution. IME still can't say who it is.
Fox Marble (FOX) H1 trading. Rev up 87%. Has started the second half of the year strongly and expects to see continued good revenue growth through the balance of the year. FOX doesn't say if it's in line.

GrahamF

31st Jul '18

Regarding Water Intelligence (LON:WATR) the cash flow per share trend has been negative despite the growth, even operating cash flow. A warning sign perhaps. Does the latest update suggest this is changing?

pgs501

31st Jul '18

Hi Graham,

I did not see anything in the Water Intelligence (LON:WATR) update suggesting cash flow had improved significantly, I guess it is unlikely to whilst they keep doing reacquisitions of their franchises (three in H1).

I do however think that this is a useful revenue beat as Stockopedia had expected revenue for the year of 21.7m and H1 grew 39% to give 11.8m. Should this growth rate continue in H2 we end up on revenues of 24.5m. Hence the 7% sp rise this morning I guess. I hold.

Pete

mrosbiston

31st Jul '18

Water Intelligence (LON:WATR) is a great update - the numbers look like beating the FY19 expectations on FY18 results, so i think the Stocko expectations are a bit light.

There is nothing in the update on cashflow, over than to say cash increased by $7.5m in the period due in part to a $5.8m rights offering. It also sounds like a good amount of capex is being made - which in this instance should be a good thing - its a growth business in a potentially large market.

How should it be assessed? This is a growth business, sales grew 39%, PBT grew 48%. It has been able to maintain this. Is this a $100m revenue business? Potentially... i would expect it to sustain the current pre-tax margin of 10%, maybe even expand this as the business matures. I like holding through the growth phase - which i would anticipate to last another 12-24 months based on historically how long a super growth phase lasts.

Unlock the metrics for all these stocks and more...

Take a free trial

Facebook Twitter Youtube Instagram RSS

This site cannot substitute for professional investment advice or independent factual verification. To use it, you must accept our Terms of Use, Privacy and Disclaimer policies.

Unlock the metrics for all these stocks and more...

Take a free trial

I Read The News Today Oh Boy! 31-Jul-2018

Unlock the rest of this article with a 14 day trial

About the Author

Matylda

4 comments

Unlock the metrics for all these stocks and more...

Unlock the metrics for all these stocks and more...