Indigovision disappoints again

Those of you who regularly read my blog will know that I have been a holder of Indigovision shares on two separate occasions. The first time I held shares I was lucky enough to crystallise profits of 750%. Relatively recently I took a more modest 50%. I've kept the company on my monitor, but haven't felt inclined to buy back in. I gave my reasons for selling the shares back in November, and after today's trading update I feel justified in having sold when I did. You can read my reasoning below:-

Trading statements and cashing in a 50% profit.

http://michae1mouse.blogspot.co.uk/2012/11/trading-statements-and-cashing-in-50.html

The shares slid back 12% today following the trading statement, and I have to say that I won't be buying back in unless the price falls substantially from here.

Back in 2004 when I first bought shares in Indigovision (for about 62p) and they went on to multi-bag, it looked very possible that the company would be a very long term hold for me. However, circumstances changed and it appeared to me that the company had lost their competitive advantage.

This statement today from Marcus Kneen, Chief Executive is very telling :- "We have made progress towards our goal of repositioning IndigoVision to achieve market rates of sales growth..."

There was a time when Indigovision aspired to and briefly did achieve more than the market rates of growth with what appeared to be a market leading position. The company now gives the impression of a being a "me also" company in its sector. Although that may be a little harsh.

The positives for shareholders are that Indigovision is profitable and boasts a strong balance sheet with no debt. It also pays dividends. It's highly unlikely that you're going to lose your shirt with a holding in Indigovision, and I certainly wouldn't dismiss a future bid for the company given the above.

However, it now looks like a company struggling to find momentum for growth, and I don't consider the company is cheap enough to have multi-bagger potential at these levels and so I'll sit on the sidelines for now.

Of course circumstances do change and I'll remain vigilant.

As ever, no advice intended or given. All opinions expressed are my own personal musings.