Small Cap Value Report (19 Jun 2017) - BON, PTSG

Monday, Jun 19 2017 by

Good morning, it's Paul here!

I'll be writing all 5 reports this week, as I've given Graham the week off, since he was such a superstar covering for me last week!

Isn't this heatwave marvellous! That was part of the reason that my report on Friday fizzled out, sorry about that. I tried to shock my Mum, by disclosing that I'd been nude sunbathing on my terrace. She brushed it aside, replying, "Oh, your father & I used to wander around the house naked all the time, in the 1970s, until you started complaining!"

Good weather should be positive for pubs, and retailers. Although when it's this hot, clothing sales usually dip initially, as people head for parks, the beach, and of course their ghastly, stinking BBQs, instead of shopping centres.

I'm still mulling over those retail figures from last week. The growth in online is extraordinary - still growing at 20% p.a. overall. That's creating terrible conditions for traditional retailers without their own decent online presence - it's like being permanently in recession for them - sales leaking away online, plus consumer disposable income now falling too. Also the threat of higher interest rates may be looming. Not to mention the unstable political situation, Brexit (will it, won't it happen? Nobody knows, nor on what terms). Plus the nightmare scenario of a hard-left Corbyn Govt, propped up by the SNP, destroying the economy with the usual left-wing profligacy.

Bull markets certainly climb a wall of worry, and I'm amazed that the market is as buoyant as it is right now. Last week's wobble seems to be receding, with a lot of fashionable growth stocks now bouncing back from sharp falls last week.

For the time being, I'm leaving BMUS 40% in cash. I just don't see any compelling buying opportunities at the moment, given that most stocks are expensive, yet there are so many risks out there. Risk:Reward looks lousy to me at the moment, with the market generally. Hence why I'd rather hang on to the excellent gains in the last 2 years, and have some powder dry to deploy in the event of a significant correction - there will be one eventually, things are way too buoyant at the moment. When buying the dip stops working, I think we could see a big market correction.

Value vs Growth investing

I was chatting…

Unlock this article instantly by logging into your account

Don’t have an account? Register for free and we’ll get out your way


As per our Terms of Use, Stockopedia is a financial news & data site, discussion forum and content aggregator. Our site should be used for educational & informational purposes only. We do not provide investment advice, recommendations or views as to whether an investment or strategy is suited to the investment needs of a specific individual. You should make your own decisions and seek independent professional advice before doing so. Remember: Shares can go down as well as up. Past performance is not a guide to future performance & investors may not get back the amount invested.

Do you like this Post?
73 thumbs up
0 thumbs down
Share this post with friends

Bonmarche Holdings plc is a multi-channel retailer of womenswear and accessories. The Company offers clothing and accessories in a range of sizes for women through its own store portfolio, Website, mail order catalogues and through the Ideal World TV shopping channel. The Company's subsidiaries include Bluebird UK Topco, Bluebird UK Holdco and Bonmarch Limited. The Company has approximately 310 stores across the United Kingdom. more »

LSE Price
Mkt Cap (£m)
P/E (fwd)
Yield (fwd)

Premier Technical Services Group plc (PTSG) is a United Kingdom-based company engaged in the maintenance, inspection, testing, repair and installation of permanent facade access equipment, fall arrest systems and lightning protection systems together with fixed wire and portable appliance testing and high level cleaning. The Company operates through three segments: Access and Safety, Electrical Services and High Level Cleaning. The Company's Access and Safety segment offers Safety Testing, Safety Installation, Cradle Maintenance and Cradle Installation. The Company's Electrical Services segment offers Lightning Protection, Fixed Wire Testing, Portable appliance testing (PAT) Testing, Fire Alarm and Extinguishers, and Steeplejack Services. The Company's High Level Cleaning segment offers Window Cleaning, Gutter Cleaning, Building Cleaning and Pressure Cleaning. The Company's Training Solutions division offers Training, Consultancy and Insurance Inspections. more »

LSE Price
Mkt Cap (£m)
P/E (fwd)
Yield (fwd)

  Is Bonmarche Holdings fundamentally strong or weak? Find out More »

48 Comments on this Article show/hide all

Ramridge 19th Jun 29 of 48

I totally lost any belief in Brown when, as a Chancellor, he repeatedly claimed to have ended the cycle of boom and bust in the UK economy..
Only when the crash came in 2008 did he finally admit he was wrong.

"Those whom the gods wish to destroy they first make mad” (as some wise dude said many centuries ago)

| Link | Share
ailsa 19th Jun 30 of 48

In reply to Paul Scott, post #19

In reply to post 10 Paul makes excellent points re the future costs of providing for an ageing population and future funding of the NHS. Today's politicians need to put such problems before the people and we all need to engage in discussion.

| Link | Share
TangoDoc 19th Jun 31 of 48

In reply to zho, post #10

It's a funny thing. So many commentators about political economics seem to think they are self made men when, in reality, we are standing on the shoulders of giants. Speaking for myself, I would be nothing today (indeed I would certainly be dead and gone) were it not for those early Labour administrations providing for my health and eduction and the council house we lived in. These were provided by the state out of general taxation, being perceived to be good for the nation as a whole. I see little reason why we should sneer at those noble aims. We should always realise that what goes around, comes around.

| Link | Share | 2 replies
hayashi22 19th Jun 32 of 48

Well clearly your education was deficient as you can't spell the word correctly.

| Link | Share | 1 reply
seadoc 19th Jun 33 of 48

In reply to hayashi22, post #32

Is not educted the meaning of the passive past form of verb to educate?  Maybe the point Tango was making? (But never could understand this new speak, could be he learnt or if from over the pond learned.)  Just a thought.

| Link | Share
abtan 19th Jun 34 of 48

In reply to PeterW, post #18

Agreed. That's what put me off buying and makes we wonder how they're growing so rapidly

| Link | Share | 1 reply
janebolacha 19th Jun 35 of 48

In reply to TangoDoc, post #31

You're right but I'd wager that those sincere and economically-responsible people who made up the Labour Administration of 1945-50, which is when those major and necessary social advances were made, would have been as appalled as anyone else by economic incompetents of the likes of Blair and Brown and, by unreformed Marxists such as Corbyn and McDonnell being in charge of the Labour Party. Those early pioneers of social justice were also looking from the appalling poverty of the Thirties and aiming to create a better future. Labour's record since that Administration has been dismal.

| Link | Share | 1 reply
Bonitabeach 19th Jun 36 of 48

In reply to truegent, post #22


For technical reasons related to a third party data vendor, all trades which are off order book will not be included in the summary statistics, last 5 trades or Prices and Trade tab until further notice.
For further information please contact us on

Example above: Phoenix Holdings

It appears to apply to all listings.


| Link | Share
Catstycam 19th Jun 37 of 48

"Oh, your father & I used to wander around the house naked all the time, in the 1970s, until you started complaining!"

Might depend on what age you were at the time Paul, age 2 or 3 maybe not such a problem; aged 22 or 23 I can see your point!. If you had a lady friend at the time then I am not surprised you complained!.

Thanks for your continuing efforts



| Link | Share | 1 reply
Housemartin2 19th Jun 38 of 48

In reply to janebolacha, post #35

Jane makes the right point. The current Labour leadership are far to the left of any previous Labour party with which we are acquainted. Comparisons with previous Labour spending are not relevant. The last manifesto was way above them. However you would expect these sorts of policies from a party that now contains Marxist and other Hard Left proponents in influential positions. The philosophy was to take over bourgeois left parties and to complement the legislator by the Street.

All governments in Western society overspend, though the Left overspends more. TheTory administrations since Brown have been pretty poor, failing to reduce the deficit in a reasonable time, mainly IMO by not cutting spending hard enough early enough and cutting taxes far too early ( why increase VAT and increase personal allowances) Indeed given the changing structure of our society, there may never be a time for tax cuts.

I suppose we get the politicians we deserve, though you have to ask what sort of an ego thinks it would be good at running the country.

I am more in cash than I have been for some years

| Link | Share
paraic84 19th Jun 39 of 48

In reply to abtan, post #34

On Amazon the two most popular products are the gradual tanner (4 out of 5 stars) and the Skinny Tan 7 Day Tanner (3 out of 5 stars). The latter seems to be a bit love/hate. Also I've heard only positive reviews so far from women I know who have tried it. Can't say I'm tempted!

| Link | Share | 1 reply
Gromley 19th Jun 40 of 48

Interesting comparison with Trinity Mirror (LON:TNI) (one of my larger holdings again currently).

It is something of an over-simplification to say that Trinity operate in a market that is in terminal decline.

Much as retailers such as Next (LON:NXT) provide goods (clothes & homeware) through both physical and increasingly digital means, so Trinity provide news through both physical and increastily digital means .

The challenges are similar; to deliver digital growth from a low base that offsets physical losses (& in volume terms Trinity is performing pretty well) and to deliver acceptable margins from the digital side (more challenging).

It is true that a low PE can be indicative of a business in trouble (a "value trap") or it can be indicative that "the market" doesn't 'get' the proposition. And while mentioning the PE, it's worth recognising that for Trinity Mirror (LON:TNI) cash generation is even better than earnings as they sweat the legacy assets. (On that score, there was an unconfirmed story a few days ago that Trinity is about to sign a deal to take over printing of the Grauniad, which would further sweat those assets).

Now is not really the time or place for a full inside out review of TNI (the interims end July-early August is better), but on my workings, considering the cash the legacy business has still left to throw off, the fledgling digital business is not just in the price for free, it's effectively valued at a substantial negative.

Similarly I'm sure mis-pricings will happen in 'bricks and mortar' retailing, but with the economic outlook I think it will be at least 12 months before I personally look for any bargains in discretionary retail.

| Link | Share
Beginner 19th Jun 41 of 48

In reply to TangoDoc, post #31

The reforms were largely based on the reports and writings produced by William Beveridge. He was a Liberal.

| Link | Share
shine66 19th Jun 42 of 48

In reply to Catstycam, post #37

Perhpas you weren't aware, Paul's a Chaka Khan fan.

| Link | Share
clarea 19th Jun 43 of 48

Hi Paul,

Whats the score re Hawk Investment holdings ?

| Link | Share
abtan 19th Jun 44 of 48

In reply to paraic84, post #39

Hi Paraic

I don't recall seeing many reviews on Amazon when I did look, so I didn't pay too much attention to the star ratings, though I appreciate that may have changed.

I went through some of the vlogger youtube videos though, and there weren't that many who were impressed. Again, maybe some positive reviews have been released since I looked about 2-3 months ago (or maybe I just missed the positive vlogs!)

Clearly the product is more popular than I thought it was though as all the numbers keep going up!

Good luck to all holders

| Link | Share | 1 reply
DGW 20th Jun 45 of 48

Paul - re PTSG. Why is Hawk Investment Holdings not a positive please/

| Link | Share
Carcosa 20th Jun 46 of 48

Perhaps because Hawk Investment Holdings is owned by Bob Morton/Family and over the years they have been involved with questionable business practices in regard to listed companies to the detriment of ordinary shareholders.

That's the polite answer, anyway ;-)

| Link | Share
paraic84 20th Jun 47 of 48

In reply to abtan, post #44

Interesting re the vlogger videos. I wouldn't mind watching one of them as part of my background research - any you'd recommend?

According to CityAM today "Analysts reacted well to the news, as Niall Pearson at Hybridan said he would look for a further 57 per cent growth in revenues in 2018. This would hike revenues to £14.1m, £12.6m of which they attributed to Skinny Tan."

So maybe 9/10p EPS for 2018?

| Link | Share | 1 reply
abtan 20th Jun 48 of 48

In reply to paraic84, post #47

Here's one vlogger review I saw:

It's fairly positive, however, it ends with a few negative points - eg the high price point.

I also recall wondering why the product would be so successful in Korea. I used to live in the region - albeit 10 years ago - and most people were interested in fair complexions. Perhaps things have changed?

| Link | Share

What's your view on this article? Log In to Comment Now

You can track all @StockoChat comments via Twitter

 Are Bonmarche Holdings's fundamentals sound as an investment? Find out More »

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 on most weekday mornings, constantly researching daily results & trading updates for small caps. Cheese! more »


Stock Picking Tutorial Centre

Let’s get you setup so you get the most out of our service
Done, Let's add some stocks
Brilliant - You've created a folio! Now let's add some stocks to it.

  • Apple (AAPL)

  • Shell (RDSA)

  • Twitter (TWTR)

  • Volkswagon AG (VOK)

  • McDonalds (MCD)

  • Vodafone (VOD)

  • Barratt Homes (BDEV)

  • Microsoft (MSFT)

  • Tesco (TSCO)
Save and show me my analysis