Investors are a funny old lot at times. Indigovision released their interims today with revenues up 25%, EPS up 26% and cash balances up 39% (and 22% in the last 6 months). Indigovision are also introducing their first maiden dividend at 4p per share, and Grossart states "We therefore continue to be confident about the immediate and long term future". What happens? The share price drops 11%.
Indigovision was not overvalued and certainly isn't now. Yes it is true that margins have fallen from 62% to 58%, but the "bigger" picture remains in tact. These are "record sales, operating profit and earnings per share." The client list continues to impress, and only yesterday they announced a contract with the BBC to add to their glittering portfolio. It should also be noted that they achieved double digit growth in all regions.
Indigovision have achieved very pleasing growth over the past three years despite the economic and political backdrop.
The shares finished today at £4.95. On historic earnings the p/e ratio is about 18.5. Not cheap, but certainly not expensive given the excellent growth they have achieved in the last few years.
When world economies do eventually gather full momentum (and they will), I fully expect indigovision to take advantage. I'm watching the share price with great interest.
Avesco had their AGM today, and I see that there have been three board changes with Richard Murray replacing Michael Gibbons as Chairman and TAYA installing Ami Giniger as a non-exec. The first quarterly report is due on Tuesday.
I expect TAYA to take a similar interest in DCD Media where they hold a 20% stake.
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