Small Cap Value Report (Wed 8 August 2018) - SHRE, TTG, IDP, SCS, STCK

Wednesday, Aug 08 2018 by

Morning folks!

A couple of interesting RNS announcements to cover today.

In the US last night, we had further entertainment from Elon Musk at Tesla ($TSLA), who tweeted: "Am considering taking Tesla private at $420. Funding secured."

It looked like it was probably a joke to me (and to others), but Musk went on to write a blog post on Tesla's website about it. From a legal point of view, it can be expensive to joke about these things.

Tesla's share price increased by 11% to close at $380 last night, not far off its all-time highs. Stormy weather in Shortville.

Today we have:

  • Share (LON:SHRE) - interim results. I'm conducting an interview with the company shortly.
  • TT electronics (LON:TTG) - half-year report
  • Innovaderma (LON:IDP) - appointment of CEO. Roots haircare brand to be ranged in Tesco.
  • SCS (LON:SCS) - trading in line with expectations
  • Stock Spirits (LON:STCK) - H1 results

Share (LON:SHRE)

  • Share price: 26p (unch.)
  • No. of shares: 144 million
  • Market cap: £37 million

Half year results

This is a stockbroker many of you will be familiar with as clients. It trades as The Share Centre.

I've just finished an interview with Richard Stone (CEO) and Mike Birkett (CFO).

My impression of the company hasn't changed. It seems to be providing clients with a very nice service, and is one of the safer brokers.

Beaufort clients will be keen to study their new service provider, as Share won the transfer of 15,000 Beaufort accounts in what must have been a competitive process.

Combining the Beaufort transfer with two other agreements, Share will soon be welcoming 38,000 new customers for a total of £1.5 billion in new assets under administration (AuM).

AuM is making serious headway. From £4.3 billion a year ago, it now stands at £5 billion and that is with the additional £1.5 billion still to arrive. This should translate to significantly greater revenues.

The Share Centre is not the cheapest out there when it comes to execution-only dealing, but it does have an excellent net promoter score (better than all other execution-only…

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All my own views. I am not regulated by the FSA. No advice.

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Share plc is a United Kingdom-based company, which is engaged in stockbroking related activities. The Company's principal business includes its subsidiary, The Share Centre Limited, which is engaged in retail stock broking. It is also engaged in fund administration business through its subsidiary, ShareFunds Limited. It operates in two segments: The Share Centre, which provides stock broking and custodian services to retail investors, and Sharefunds, which operates a fund administration service. The Sharefunds segment provides a range of administration services to the authorized funds. Its subsidiaries include The Share Centre (Administration services) Limited, which is engaged in providing administration services; Share Nominees Limited, and Sharesecure Limited. The Share Centre Limited provides services to personal investors on a self-select basis, including account types, such as share accounts, self-invested personal pension and individual savings account. more »

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TT Electronics plc is a provider of engineered electronics applications for performance-critical applications. The Company works with customers in the industrial, medical, aerospace and defense, and transportation sectors. The Company’s designed and manufactured products include sensors, power management devices and connectivity solutions. more »

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InnovaDerma PLC is a holding company. The Company develops a range of male and female at-home and clinically proven treatments for hair loss, hair care, self-tanning and skin rejuvenation. It operates through hair and beauty division. Its products include Leimov Personal Hair Laser Starter Kit, Leimov Hair Treatment Pack, Leimov Bio Cleansing Shampoo, Leimov Thickening Conditioner, Leimov Scalp Therapy Day Treatment, Leimov Scalp Serum Night Treatment, Leimov Deep Cleansing Scalp and Body, Leimov Hair Treatment Pack for Her, Leimov Personal Hair Laser Starter Kit for Her, Leimov Vitality Shampoo, Leimov Follicle Boost Therapy, Leimov BioPlex Scalp Serum, Leimov Scalp and Body Exfoliating Spa, Leimo Instant Hair Introductory Pack, Leimo Instant Hair Regular Pack, Leimo Instant Hair Building Fiber, Skinny Tan-Ab Shader, Skinny Tan-Dermabrasion Pre-tan Primer, and Tan and Glow. It operates in the United Kingdom, the United States, Australia, New Zealand, the Philippines and South Africa. more »

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

44 Comments on this Article show/hide all

john stone 8th Aug '18 This post is under review

Could you do £GFM from yesterday?

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john stone 8th Aug '18 This post is under review

Why doesn't the ticker show?

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runthejoules 8th Aug '18 7 of 44

Morning all! Morgan Sindall (LON:MGNS) might be too big to cover here now but I'd like to hear views on it - EPS up 28%, price up 4% last time I checked. However forward order book down 6% & Brexit fears mean I haven't bought any. They're building a new Poetry Library up here in Manchester so local interest too really!

Innovaderma (LON:IDP) - their baldy cream 'Roots' is to be sold in Tescos and they have a new CEO, previously a NED. I'd forgotten I still held this, up 22% this morning, wonder if it will hold into results

PS Vertu Motors (LON:VTU) - can anyone work out if Directors have bought or sold?


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runthejoules 8th Aug '18 8 of 44

In reply to post #389064

Do you mean £G4M John Stone?

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jonno 8th Aug '18 10 of 44

A second vote for TT electronics (LON:TTG) Graham that you have covered previously. Impressive interims with outlook for the full year "ahead of our prior expectations". I hold.

All the best


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mwogan 8th Aug '18 11 of 44

Hi, can you look at SECURE TRUST BANK (STB)

Interim results, Rev £72.5m v £61.1m, PBT £15.1m v £11.5m, EPS 74.7p v 53p. Re positioning of the business has lead to be income growth. With strong performance seen throughout the business. The board are cautiously optimistic of further growth through the second half. Shares down from £21 to £16.50 recently.

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RichardK 8th Aug '18 12 of 44

In reply to post #389054

Me too, Phil. Doesn’t say much for PWC.

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Camtab 8th Aug '18 13 of 44

A third for TT Electronics please Graham.

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Edward John Canham 8th Aug '18 14 of 44

In reply to post #389104


Certainly doesn't, howerver, I'd better second a request for Graham to look at Share as it's now going to be one of my providers.

All the best.


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Graham Neary 8th Aug '18 15 of 44

In reply to post #389039

Yes, I'm studying Share (LON:SHRE) and TT electronics (LON:TTG) today. Cheers! G

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Trident 8th Aug '18 16 of 44


He probably got a perverse delight by trying to burn shorters, but its a dangerous game to be playing if just a joke.
Its not as if the USA is short of litigants!

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rpmeurope 8th Aug '18 17 of 44

Is Paul Scott no longer doing these reports? Have not seen him do one in weeks.

Secondly, to Graham, if he is talking to Share (LON:SHRE) management, I would like him to ask the question regarding their technology spend. I understand the expenditure is necessary, but it is worrying to see the constant dribble of cash out the door year after year. For the past 5 years, the cash balance has been in decline. Do they have a timeframe for when the cash bleed stops and they go into positive territory?

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Calahan 8th Aug '18 18 of 44

In reply to post #389154

"Is Paul Scott no longer doing these reports? Have not seen him do one in weeks."

As I understand it Paul is taking a (well earned) sabbatical this summer, which is why Graham has been doing all the reports. Paul mentions it in the most recent report he did (when covering for Graham).

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mw8156 8th Aug '18 19 of 44

Not strictly a small cap but any thoughts on Hill and Smith, previously regarded as a highly reliable compounder?

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Clitheroekid 8th Aug '18 20 of 44

I'd be interested in Graham / Paul's view on Clipper Logistics (LON:CLG).

They came on to my radar back in April, when Paul gave them a favourable mention at, I think, The Investopedia event.

At that time they were standing at £4.58, but they've since dropped substantially, and as of today they're trading at around £2.97. This is despite announcing new orders recently, and generally looking well-positioned to succeed from the growth in mail order shopping.

I'm increasingly tempted to take the plunge at what looks increasingly like a bargain price, but I'm wondering if there's something that I'm missing.

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Tamarix 8th Aug '18 21 of 44

Re Share (SHRE)
Charging 1% on trades is unbeliuevable in today's climate. That leads them to deal for only the very smallest portfolios.

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bobo 8th Aug '18 22 of 44

I've used JIM and SHRE as brokers and holders of assets for some years (+15?) and finally sacked SHRE as part of a cost cutting exercise, I've never had a problem with either broker and I like the old fashioned JIM customer interface. I've also had some experience with transfers of assets as a broker joins or moves names/software/ownership and frankly it is very frustrating as data is lost, software tools evaporate etc, as a client I hate it and much prefer JIM's organic growth strategy where my money is my money and it is easy to access, recently Sharetrade's transfer was a disaster.

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shipoffrogs 8th Aug '18 23 of 44

Charging 1% on trades is gouging - can't see why anyone would want to pay those rates.

| Link | Share | 1 reply
barnetpeter 8th Aug '18 24 of 44

Tesla...HUGE short interest in the market and I know many commentators in the UK have said it was a sell (Inc Paul Scott at one time if I remember?).

Must have all taken a huge hit yesterday. I wonder if Wall Street will sell off a bit as positions are sold to try to balance the debt.

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About Graham Neary

Graham Neary

Full-time investor and independent analyst. Prior to this, I spent seven years in the financial markets as an analyst and institutional fund manager. I'm CFA-qualified, also holding the Investment Management Certificate and the STA Diploma in Technical Analysis.Away from finance, my main interests are recreational poker and everything to do with China, especially Mandarin Chinese. more »


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