Small Cap Report
XPP. Put a bean counter in charge of a technological company and it will cease to thrive. When I was a Director of a Public Company in the 70' and 80's, that was our belief and it still holds good today. This was a thriving and growing Company run by people who had a passion and intimate understanding of the product and the shares grew from £2.00 to over £50.00 in a little over 10 years. An excellent CFO is wasted at the top of a Company which is technologically based.
As a former director of a listed tech business, I share your sentiment. But are its shares performing worse than those of its semiconductor clients? And are the issues - supply chain, inflation, litigation etc - caused by putting the bean counter in charge?
Looking at the long term chart it could be argued this is simply a tech share with enhanced cyclical volatility. 50% drawdowns are a hazard of ownership.
check out £POWI to see what a well managed power control company can be worth/rated. Richard Bedard, blogger, covers XPP well. Worth a read of his stuff on the company. He likes it a lot. Potentially a good recovery play but not until numbers improve and it gets inventory/working capital back under control.
While the underlying business has some challenges (who doesn't right now?) I think the main culprit is the litigation, and the uncertainty and loss of reputation that brings?
If it wasn't for that and the $40m hole in the accounts I suspect I'd be reasonably happy with XPP in the current conditions.
