It's been just over one year since I last updated this blog about the 5 companies that I have boldly predicted will 10 bag in 5 years or less. It's not a tipping sheet so thoroughly carry out your own research if any of the five companies catch your attention. Be aware that all 5 are micro-caps and listed on AIM so expect some illiquidity and often large swings in their share prices. I am an advocate of buy and hold and my holding period is often greater than 5 years.
This is the second update since my original post back in August 2020. Obviously, it's been a pretty uneventful year worldwide :-$
Sarcasm aside, for the five companies that I am covering, I'm more than happy with the progress of their respective businesses, and see nothing to alter my vision of their future prospects. I will add the caveat that absolutely nothing can be taken for granted in this game so I always remain vigilant but try to distinguish between short term disappointments and the long term prospects of a business.
So let's start. Firstly here was the original post in August 2020:-
and the follow up in January of this year:-
The mouse "shares" his thoughts: 2020 (michae1mouse.blogspot.com)
1) IXICO (current share price 81.5p - up 18%)
Ixico was on a real roll and up 36% when I last reported, but in March a major client stopped dosing participants in its phase III trial and open-label extension studies in Huntington's disease following a pre-planned review of the data. This led to some uncertainty re: IXICO's short/medium term revenues and order book from this client and the share price took a hit. Since the basic story remains in tact, and expectations from this particular client have now been clarified, it proved to be a buying opportunity. Strong half year results, a solid trading update in August for the full year (£1.2m EBITDA in-line with prior year), strong order book, excellent balance sheet and more contract wins have reassured and the share price has bounced back.
This week the company gained more momentum with their first contract award from a new Imaging Master Vendor Agreement with a top 5 global CRO. The contract itself is worth greater than $750,000, but more significantly being selected as a dedicated imaging vendor is expected to significantly enhance IXICO's opportunity to partner with the CRO's client portfolio.
I'm very pleased with the progress here, and continue to envisage huge upside potential.
2) CRIMSON TIDE (current share price 3.05p - down 10.3%)
Excellent set of results released in April for year ending December 2020 with revenue up 21%, EBITDA up 22% to £946,000, cash up to £1.157m from £320,000 and a very bullish outlook. So why the slight share price fall? Simply put, the company sees a huge market opportunity in which to grow significantly, but that needs investment and in April the company raised £6m via a placing at 3p. This is a big positive, and in the medium to long term prospects for Crimson Tide look even bigger and brighter. Crimson Tide is a hidden gem, and whilst the full benefits may take a little time to become apparent, this is a company that has gross margins of 87%. is growing long term subscription revenues and winning sizeable clients across supermarkets, rail and the NHS.
We might see their interim results this week, certainly in the not too distant future.
3) BIOME TECHNOLOGIES (current share price 410p - up 75%)
The star performer so far. Their bioplastics division is really beginning to gain traction, and the company is targeting 40% growth per annum from 2022 onwards. Ongoing delays in shipping and transportation constrained the first half of this year, although there was still some growth. However, looking forward into Q4 this year and beyond it gets very exciting with new large customers in the USA coming onboard and a strong pipeline of projects. The icing on the cake could be a pick up in orders in their RF division which has generated annual revenues of between £4m-£8m in the past and is very cash generative. A possible perfect storm for outperformance in 2022 and longer term.
4) SRT MARINE SYSTEMS PLC (current share price 41p - down 3.5%)
Not much to say about this one since last reporting since there has been very little news. Final results were released in July and as anticipated. This company just needs to deliver on these figures:- £550m systems division validated system sales opportunity pipeline, of which £71m are very near term. I think they will, and then it gets very exciting.
5) TRAKM8 (current share price 23p - up 23%)
It's beginning to look likely that Trakm8 have not only survived after disappointing in recent years but are now likely to prosper. They've successfully navigated the "lockdown" storms and look like a leaner outfit. They released a trading statement this week with revenues predicted to be around 19m and a break-even performance, in-line with market expectations. Next years profits are expected to be around £2m which means the market cap. looks anomalous at just £11.5m, particularly when compared to their peers. In the background we have the recently listed telematics company Microlise who hold 20% of Trakm8 and hold ambitious plans within a rapidly consolidating sector.
That's it for the update. This overall portfolio is up 20% from my first post. As stated, I'm happy that all five still retain the potential for huge outperformance and I'll update again in 6/12 months time.
Th
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