James Montier 'Unholy Trinity' Screen

Saturday, Sep 28 2019 by

I have just noticed that TERN has appeared in James Montier 'Unholy Trinity' Screen Guru listing of shares.

I will start by saying that, I hold TERN shares, and I think shorting is morally wrong (call me old fashioned). But as a long term holder of TERN, I felt that I should point out to the Stockopedia community that shorting TERN should come with a significant health warning.

Over the past 18 months, the share price of TERN has taken a roller coaster journey, rising from 3p to a spike of 47p and now back down again to 8p. If you research TERN you will see that it is actually a group invested in 6 companies, a summary of which I have listed below.

Current portfolio

The group currently owns six investments – the main four are described in detail below, with Tern owning material stakes in each :

Device Authority (£12.3m of NAV as at 30 June 2019) – automates the provision of secure platforms for IIoT and IoMT devices and associated applications. Medical is the largest current sector in terms of client activity, but the process is applied very broadly, can managed complex PKI (Public Key Infrastructure) or other environments, and offers long- term recurring revenues

FundamentalVR (£2.2m of NAV) – provides a software simulation environment, allowing surgeons’ accuracy to be measured objectively for the first time

InVMA (£1m of NAV) – is focussed on heavy-industrial clients, with a platform to help implement IoT sensors and monitors; InVMA also provides associated services

Wyld Networks (£78,000 of NAV) – has a wireless mesh technology to allow low-power networks to be formed, often in a smart-meter environment

Tern also has very modest equity stakes (<1%) in two other companies – Seal Software and Push Technology.

If you visit the TERNplc.com web site, you will see that they have a strategy of taking their investee companies through three stages, at least 2 of which they have stated are at the stage 3 Release. TERN have clearly stated that they are looking for a significant partner. The likelihood is that the partner will test the Investee company as a precursor to acquisition.

Tern Diagram 2018 v2

Last week Thales presented a joint webinar with Device Authority and it was very clear that the majority of the difficult stuff was…

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Tern Plc invests in, develops and sells private software companies with technology, based in the United Kingdom. The principal activity of the Company is investing in unquoted and quoted companies to achieve capital growth. The Company focuses on businesses in the cloud, Internet of Things (IOT) and mobile sectors. The Company focuses on building companies with technologies and services within the IOT market. more »

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4 Posts on this Thread show/hide all

andrea34l 29th Sep 1 of 4

I would suggest that investing in TERN should come with a significant health warning! Dilution is highly likely too!

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Neil66 29th Sep 2 of 4

If I really wanted to place a bet on something as narrow as IoT (which I don't), then I think I would chose something like this ETF this over Tern. A broader footprint of businesses that support IoT - and also other technology trends in addition to IoT:


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CheshireUK 30th Sep 3 of 4

I would readily accept that TERN is not for widows or orphans, but as I originally purchased at 3p it has still more than doubled my original investment. I reserve 5% of my Portfolio for higher risk stuff which could crash or make spectacular returns. Over the next 5 years the IOT market growth will be almost exponential which has led many long term investors to believe that TERN’s share could well be valued in pounds not pence. The prospect of Microsoft acquiring Device Authority in the not too distant future is a very real one IMHO. But do your own research.

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CheshireUK 6th Oct 4 of 4

The end of last week proved to be very interesting for TERN investors with a 16% increase over 2 days. This week we are expecting a  joint presentation between Device Authority and  Microsoft which I believe will demonstrate how valuable Device Authority is to Microsoft. 

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