Just for future reference, my twitter page is https://twitter.com/michae1mouse which I use to notify readers when my blog has been updated.
Just a few news stories released today. The company that I 've just a had quick look at is Digital Barriers which describes itself as a specialist provider of advanced surveillance technologies to the international homeland and defence markets. The news story that grabbed my attention was a RNSNON that detailed three new contract wins with a total value of £1.05m.
After a cursory glance, Digital Barriers looks an interesting potential growth company and the share price has been steadily moving upwards from a low in November this year.
Technical analysts may identify the up trend as a possible trading opportunity? The share price has advanced a further 3.9% today.
Reading further down the news stories, I noticed that six Directors had recently purchased £234,479 worth of shares in the company at £1.45. Further inspection reveals that this was their participation in a recent placing to raise £10m "to finance the acquisition of a fourth core technology".
All good so far. However, this led me to have a quick glance at the financials. The current market cap. is £70.5m and at the interim stage, whilst revenue has grown by an impressive 68%, the company made an adjusted loss of £5m. Whilst they still had £7m+ cash on the balance sheet (pre-placing), cash burn for the six months was a whopping £8m.
Some many fancy the potential growth story here and wish to research further, but for me it would take a huge leap of faith and it certainly won't be on my monitor at this stage in its development.
Good luck with your investing and if you need any good books to help, the link below takes you to my recommended reads:-
http://astore.amazon.co.uk/httpmichae1mb-21
Friday, 4 January 2013
Thursday, 3 January 2013
New Year resolution
Well my entry on the "stocks to double in 2013" ADVFN thread has made a decent start. Up a tad yesterday and a further 10.5% today. Very early days yet, and as I mentioned in an earlier blog, Angle is a punt that could multibag or amount to nothing based on the success of its Parsortix product. I just hope it's the former rather than the latter.
I've made a New Year's resolution to try and post more often on my blog and will aim to write a piece four or five times a week if time permits.
What I've decided to do is to pick out a company from the news stories of the day and write a brief piece about my initial thoughts on the company. Please note that I don't offer any advice just some observations after a cursory glance at recent company news and financials.
Today I am going to start with Chemring (CHG) who announced the appointment of a new Group Finance Director. Steve Bowers joins from UMECO, a company that were recently acquired for £5.50 per share (close to their all-time high of just over £6). Interestingly Steve Bowers was closely involved with acquisitions and disposals whilst with UMECO. I say interestingly since Chemring were recently in discussions with Carlyle Group about a possible takeover. However, talks have subsequently collapsed and Chemring's share price has followed.
Despite a 6.5% rise in the share price today, Chemring's historic p/e ratio is around 6 and if they hold the dividend the payout is nearly 6%. So why do the shares look cheap? Well a recent trading statement stated that 2012 had been extremely disappointing and the market backdrop for 2013 remained challenging.
On a more positive note, they also mentioned that in the final quarter there was a significant cash inflow and that nebt debt would be £250m down £12.7m on last year. They also have a relatively new CEO - Mark Papworth who delivered substantial improvements in profitability in his time at Wood Group.
A bit of a mixed bag, but if nothing else maybe one to keep on your monitor, although no advice is given or intended and the figures I have quoted are directly taken from other sources and need checking.
For those of you who take time to read the blog many thanks and I'll endeavour to keep my New Year resolution.
I've made a New Year's resolution to try and post more often on my blog and will aim to write a piece four or five times a week if time permits.
What I've decided to do is to pick out a company from the news stories of the day and write a brief piece about my initial thoughts on the company. Please note that I don't offer any advice just some observations after a cursory glance at recent company news and financials.
Today I am going to start with Chemring (CHG) who announced the appointment of a new Group Finance Director. Steve Bowers joins from UMECO, a company that were recently acquired for £5.50 per share (close to their all-time high of just over £6). Interestingly Steve Bowers was closely involved with acquisitions and disposals whilst with UMECO. I say interestingly since Chemring were recently in discussions with Carlyle Group about a possible takeover. However, talks have subsequently collapsed and Chemring's share price has followed.
Despite a 6.5% rise in the share price today, Chemring's historic p/e ratio is around 6 and if they hold the dividend the payout is nearly 6%. So why do the shares look cheap? Well a recent trading statement stated that 2012 had been extremely disappointing and the market backdrop for 2013 remained challenging.
On a more positive note, they also mentioned that in the final quarter there was a significant cash inflow and that nebt debt would be £250m down £12.7m on last year. They also have a relatively new CEO - Mark Papworth who delivered substantial improvements in profitability in his time at Wood Group.
A bit of a mixed bag, but if nothing else maybe one to keep on your monitor, although no advice is given or intended and the figures I have quoted are directly taken from other sources and need checking.
For those of you who take time to read the blog many thanks and I'll endeavour to keep my New Year resolution.
Wednesday, 2 January 2013
Gambling vs investing
Hot off the press. Disney have "filed a petition to seek leave for a rehearing en banc with the Ninth Circuit" regarding the award of the damages made against them in favour of Celador.
It shouldn't come as any great surprise. Disney have tried to drag this out for as long as possible. It seems clear that they will pursue it to the bitter end i.e. until every possible option has been closed to them.
I have no idea how long the process could take from here, but I'd be very surprised if the ruling was overturned at any point. Quite frankly it would make a mockery of their judicial system, although Disney are clearly hanging on in there with a faint glimmer of hope!
As I mentioned before, the rapidity with which the ninth circuit rejected Disney's appeal seems to suggest that Disney's arguments against the ruling are weak, and I can't see that another panel of judges will wish to overule a jury, the original trial judge and three of their own judges. It may take some time yet, but I do think the original award will stand and that Avesco will eventually receive their $60m share.
However, the above does illustrate the huge difference between gambling and investing on the stock market.
Avesco is a profitable, cash generative and growing business that is more than worth its current valuation without any payout from Disney. Investors will have bought shares based on Avesco's prospects at present and for the future. However, the gambling fraternity have undoubtedly been buying and selling on every twist of the Disney case. I doubt very much if many of the gamblers have made any decent profits.
I shall sit tight and await Avesco's full year results with interest. Whilst 2013 won't be quite as spectacular as 2012 (the odd year effect), I anticipate that underlying growth will be encouraging and I expect that dividends will continue to rise.
It shouldn't come as any great surprise. Disney have tried to drag this out for as long as possible. It seems clear that they will pursue it to the bitter end i.e. until every possible option has been closed to them.
I have no idea how long the process could take from here, but I'd be very surprised if the ruling was overturned at any point. Quite frankly it would make a mockery of their judicial system, although Disney are clearly hanging on in there with a faint glimmer of hope!
As I mentioned before, the rapidity with which the ninth circuit rejected Disney's appeal seems to suggest that Disney's arguments against the ruling are weak, and I can't see that another panel of judges will wish to overule a jury, the original trial judge and three of their own judges. It may take some time yet, but I do think the original award will stand and that Avesco will eventually receive their $60m share.
However, the above does illustrate the huge difference between gambling and investing on the stock market.
Avesco is a profitable, cash generative and growing business that is more than worth its current valuation without any payout from Disney. Investors will have bought shares based on Avesco's prospects at present and for the future. However, the gambling fraternity have undoubtedly been buying and selling on every twist of the Disney case. I doubt very much if many of the gamblers have made any decent profits.
I shall sit tight and await Avesco's full year results with interest. Whilst 2013 won't be quite as spectacular as 2012 (the odd year effect), I anticipate that underlying growth will be encouraging and I expect that dividends will continue to rise.
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