Small Cap Value Report (12 Sep) - FRP, DIA, MYXR, THAL

Thursday, Sep 12 2013 by
9

Good morning. Oh dear, the alarm didn't go off this morning, I always struggle on Thursdays, my apologies. I'll try to catch up this evening and update this article properly, but have to dash now for another investor lunch, the third of the week. Trouble is, the networking and meeting companies is vital to out-perform, in my view - it's no good being insular, you have to soak up ideas & intelligent views from other people.

Fairpoint (LON:FRP) has issued interim figures. I bought back into this one a few weeks ago, as the valuation was beginning to look compelling again, and the shares were starting to edge up. It's since risen about 20%, so that was a good decision.

Adjusted EPS is up 12% to 5.87p for the six months, and they have moved into net cash of £2.8m. The dividend is up 10% to 2.15p, so those look good enough figures for me to sit tight on these shares. They don't comment on the outlook versus market expectations, which is annoying. I don't like waffle in outlook statements, I just want to know whether they think the full year will meet expectations or not. They do say that they are "confident of delivering a solid performance in the current year", which is reassuring, albeit too vague for my liking.

 

 

 

 

Very belatedly, I'll catch up on the rest of the day's news, as I've been out all day. It's a mid cap really, but I see that Dialight (LON:DIA) has warned on profits, with the shares down 16% to 1150p. They say that contract delays mean that profits are likely to be "broadly in line with the prior year". It did 41.3p EPS last year, so that means the shares are still far from cheap on a PER of 27.8. That's a seriously racy price for a company that is not showing any profit growth against last year - I'm surprised the shares haven't fallen considerably more, so are not of any interest to me.

 

 

 

 

Several friends hold shares in MyCelx Technologies (LON:MYXR) and it's a company I've looked at before, but the price raced away on a newspaper tip, and given the high…

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Fairpoint Group plc is a United Kingdom-based company, which provides consumer professional services, including legal services, claims management services and debt solutions. The Company has four segments: claims management, legal services, individual voluntary arrangements (IVA) and debt management plans (DMP). The IVA segment consists of the subsidiary company, Debt Free Direct Limited, which is an IVA that consists of a managed payment plan providing both interest and capital forgiveness. DMP services segment consists of the Company's subsidiary, Lawrence Charlton Limited, which provides DMP for consumers. Claims management segment provides a range of claims management services, including reclaiming payment protection insurance (PPI). The legal services segment provides a range of consumer-focused legal services with lines, such as family law, complex personal injury, personal legal services, and a legal processing center focused on both personal injury and conveyancing work. more »

LSE Price
10p
Change
 
Mkt Cap (£m)
n/a
P/E (fwd)
n/a
Yield (fwd)
n/a

Dialight plc is a holding company. The Company manufactures and sells lighting products in the industrial market. It operates through two segments: Lighting, and Signals and Components. Its Lighting segment develops, manufactures and supplies light emitting diode (LED) lighting solutions for hazardous and industrial applications, and includes anti-collision obstruction lighting. Its Signals and Components segment develops, manufactures and supplies status indication components for electronics original equipment manufacturers, together with industrial and automotive electronic components and LED signaling solutions for the traffic and signals markets. Its LED lighting solutions include Vigilant Industrial Solutions, DuroSite Industrial Solutions and StreetSense Infrastructure Solutions. Its LED signaling solutions include transportation signals, obstruction signals and SafeSite hazardous area signals. Its indication solutions include Circuit Board Indicators and Panel Mount Indicators. more »

LSE Price
466p
Change
-2.0%
Mkt Cap (£m)
154.7
P/E (fwd)
13.6
Yield (fwd)
1.4

MYCELX Technologies Corporation (MYCELX) is a clean water technology company. The Company offers solutions for the oil and gas industry's water treatment needs. It provides water treatment solutions to the oil and gas, power, marine and heavy manufacturing sectors. It provides clean water technology equipment and related services. Its MYCELX polymer uses molecular cohesion to remove oil from water to levels the customers require. The core of the MYCELX solution is the MYCELX compound, which consists of a chemical polymer that is infused in the consumable media. The Company sells consumable filtration media on a long-term, recurring basis. It also offers technical services on a recurring basis. It provides water services to manufacturing; power and utilities; facilities and ground water remediation; marine; air filtration, and still response. The MYCELX systems remove oil to low levels in a smaller physical footprint. MYCELX can achieve oil removal to less than one part per million. more »

LSE Price
90p
Change
 
Mkt Cap (£m)
86.5
P/E (fwd)
53.3
Yield (fwd)
n/a



  Is LON:FRP fundamentally strong or weak? Find out More »


4 Comments on this Article show/hide all

kevanp 12th Sep '13 1 of 4

Good day Paul. Any thoughts on Kentz (LON:KENZ) now that the AMEC offer has been withdrawn? Price is currently down 60p at 490p, putting it on a projected PER for 2013 of 10.9. The company is obviously confident that they're worth more than the £700m offer.

| Link | Share | 1 reply
Paul Scott 12th Sep '13 2 of 4

In reply to post #77164

Hi Kevanp,

I've had another quick look at the figures on Kentz (LON:KENZ), and it doesn't have enough upside on it for me at 499p. I originally bought the stock on fundamentals at 395p, in May 2013, explaining why here.
At that price it looked excellent value, with the PER at 8.9 and dividend yield of almost 3%.

It's currently showing a PER of 13.0 times 2013, and 11.9 times 2014 earnings, which isn't low enough to get me excited, similarly with the dividend yield now being around 2% there are better opportunities elsewhere in my opinion.

Cheers, Paul.

| Link | Share | 1 reply
Cisk 12th Sep '13 3 of 4

Paul, what about Amec (LON:AMEC) ? Personally, as a shareholder, I'm glad they weren't willing to overpay for Kentz.

They offer a yield double to that of Kentz - maybe the P/E still too high though?

Regards, Cisk

| Link | Share
kevanp 12th Sep '13 4 of 4

In reply to post #77210

Hi Paul

Thanks for the note. I guess I was just thinking wishfully, having missed the original boat.

Best,
Kevan

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About Paul Scott

Paul Scott

I trained as an accountant with a Top 5 firm, but that was so boring that I spent too much time in the 1990s being a disco bunny, and busting moves on the dancefloor, and chilling out with mates back at either my house or theirs, and having a lot of fun!Then spent 8 years as FD for a ladieswear retail chain called "Pilot", leaving on great terms in 2002 - having been a key player in growing the business 10 fold. If the truth be told, I partied pretty hard at the weekends too, so bank reconciliations on Monday mornings were more luck than judgement!! But they were always correct.I got bored with that and decided to become a professional small caps investor in 2002. I made millions, but got too cocky, and lost the lot in 2008, due to excessive gearing. A miserable, wilderness period occurred from 2008-2012.Since then, the sun has begun to shine again! I am now utterly briliant again, and immerse myself in small caps, and am a walking encyclopedia on the subject. I love writing a daily report for Stockopedia.com on most weekday mornings, constantly researching daily results & trading updates for small caps. Cheese! more »

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