Small Cap Value Report (Thu 11 Mar 2021) - PHTM, PCIP, RWI

11th Mar '21 by Paul Scott

81 comments 11153 reads

Good morning, it’s Paul here with the SCVR for Thursday.

Timing - it's slow going again today, but I'll keep plodding on until mid to late afternoon.

Agenda - firstly a couple of catch up items which I prepared last night -

Photo-me International (LON:PHTM) - Preliminary results FY 10/2020 - done

Pci- Pal (LON:PCIP) (I hold) - my notes from today's interim results webinar - done

Renewi (LON:RWI) - Trading update for FY 03/2021. Significantly ahead of expectations. Terrible balance sheet, but does it matter?

Restaurant (LON:RTN) - placing & results - to do, sorry this is late

Online results webinars

There are 2 interesting small software companies doing InvestorMeetCompany webinars today -

10:00 - Pci- Pal (LON:PCIP) (I hold) - see my review of interim results here on 8 March - see my notes on the webinar below

14:00 - Beeks Financial Cloud (LON:BKS) - see my review of interim results & contract extensions here, yesterday

I’d like to echo a reader comment from a few days ago, that many of us are finding these results webinars incredibly useful. Many thanks to all the companies who go the extra mile to provide such quality information and access, to their smaller shareholders, we really appreciate it!

All companies, large and small, should do an online results presentation, so that the playing field is levelled up between institutions and private investors (PIs).

Companies I talk to are really pleased to be getting more engaged with their PIs, enjoying the process, and seeing clear benefits from it - improved liquidity, and higher share prices, once they get their investment proposition out to PIs.

This is not just a reaction to lockdown, we need these online results webinars to continue permanently, as it’s a far more practical way to engage with PIs who may have day jobs & not be able to get into London for meetings.

Management traits - It’s great to get a feel for the people who are actually running the company, hence why I enjoy results webinars so much. I also like it when they involve other team members in the presentations, not just the CEO and CFO.

Personally, with small caps, I’m looking for hands-on entrepreneurs (preferably founders, and with large personal…

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ken mitchell

11th Mar '21

I think that 2.7% ongoing charge fee for Oakley Capital Investments (LON:OCI) includes the performance fee, but agree the too high charges are a negative. But charges across the Private Equity Investment Trust sector tend to be too high with some far higher than Oakley Capital Investments (LON:OCI). That’s not to defend them but to put the OCI charge in perspective.

e.g LMS charge is a whopping 5.69% and performance is very poor at just +7% for 1 year and minus 41% for 5 years.

High charges obviously eat in to performance but OCI performance is good despite the charges. Princes Private Equity charge is 4.24% but again performance is good. 1 year 21% and 5 114%.

If put off by too high Oakley Capital Investments (LON:OCI) charges, then an exception well worth checking out is Standard Life Private Equity Trust (LON:SLPE) with 1.15% charges including performance fee. That’s the lowest in the sector and performance is good. 1 year +32% and 5 year +158%. Their charges show no excuse for too many in the sector charging too much.

Roger Baron

Anyone else noticed the stake building in Hammerson (LON:HMSO) by Morgan Stanley? 9 notifications in 3 weeks (2 today) and now over 10% holding.

Star8

Hi Paul

Thanks for your comments and of course for your honest comments and rare expertise.

What you say is of course correct- I also found it annoying that the profitability per line of business was not given (ever or at least in the last few years). Having said that, if I owned nearly 30% of a company and had built it up over almost 50 years would I care what some relatively small shareholder thought and demanded ?

It is what it is and demanding as you rightly do, clearer and better presented information is possibly a chimera.

Albertos

Begbies Traynor (LON:BEG)

Placing at a slight premium to fund acquisition - primary bid platform being used for Pi's.

Phil

Bouden54

SLPE is a fund of funds and I believe the ongoing charges figure you mention only relates to the charges and costs from Standard Life. The funds they invest in will also impose hefty charges which would probably bring it close to OCI.

Boon

Tried to get an allocation at 6:30pm on PrimaryBid, but kept kicking me back out to the homepage, so assume they've closed the bookbuild earlier than the 8pm deadline because of strong demand for Begbies Traynor (LON:BEG)

Can't blame people jumping in. Placed at the current share price, and crunching through the numbers, looks like it should be at least 20% EPS enhancing for FY22, even after accounting for dilution.

Momoko Miyamoto

the other thing to watch out for with private equity is whether the investee companies have raised funding from other investors and and what valuation. Otherwise the NAV is just the opinion of the fund manager and his cronies. Woodford was rather guilty of this.

abtan

Many thanks for all the responses on Oakley Capital Investments (LON:OCI) today. They are most appreciated and have certainly given me plenty of food for thought.

I have thumbs up'd each and every one in appreciation of your contributions.

Cheers

gus 1065

re. Begbies Traynor (LON:BEG) on Primary Bid, make sure you go in via the App rather than via the Website. They’ve moved most of their recent offers exclusively onto that platform. I tried to subscribe just now (18:48 ) and it still appeared to show the offer as open. I haven’t followed through as I’m not looking to participate in this one.

Gus.

Simon Rowan

Ah thanks Dah. Just registered but no luck.

Harry Hindsight

Why should they be your credit card for gambling.

Rusty2

I don’t gamble.

Carey Blunt

late news on the, selling a stake in some joint ventures.... https://bit.ly/38sgLxS

greensiax

Hi Mark,

I share these heatmaps to give a visual indication of what is going on in the SCVR world: who’s reporting and what’s moving a lot. Nothing else.

I am certainly not implying that you should buy or sell anything - only you can decide that :-)

If you read my heatmap thread I explain how I use heatmaps to help me with my research.

Take care,

Dojosan

12th Mar '21

£THS - the SP is rather stagnant the mo. because there is a persistent seller . Watching the SP action can be amusing. The trades are awash with buys, yet the SP hardly moves or on some days has retraced a little. The next day - it's a groundhog day! Sooner or later the dam's going to bust. Here's to hoping. I hold.

garbetklb

I emailed Tracsis yesterday & got a reply from their PR company (which, in itself, annoys me!) denying that there was to be an investor call on 8th. So I wonder where you saw the item in your post?

sharw

13th Mar '21

In my post is a screenshot from finnCap - the nomad for Tracsis.

Hence why Spire Healthcare (LON:SPI) has had a massive share price recovery!

Why do you then want to hold shares where the dominant 27% shareholder and chairman (?) doesn't care about small shareholders?

Finally, Marks And Spencer (LON:MKS) leveraging it's strong brand, destination status on the high Street, and top 10 traffic online store status. And monetising them through the platform model.

Small Cap Value Report (Thu 11 Mar 2021) - PHTM, PCIP, RWI

Online results webinars

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Paul Scott

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