Sometimes it's easy to become preoccupied with certain events at a company, and forget about some important details that are currently unresolved.
Readers will know that I'm a great fan of Avesco, and believe the company to be undervalued on any number of measures with or without a payout from Disney.
Recently of course like most shareholders I've been eagerly anticipating the 2012 results (due in a week or two) and any news associated with the Disney case. However, something else is on my mind.
At the June interims, Ian Martin the CEO of the company stood down from the board after ten years. Nothing too surprising there perhaps, but that was 6 months ago and they haven't yet found a replacement unless they are waiting to announce the new incumbent with their final results?
I re-read the interim statement again today where Richard Murray (Chairman) states the following:-
"Ian Martin, the Chief Executive, has decided to step down from the Board and leave the Company to pursue other interests and opportunities. I have known Ian for a long time and since I asked him to come to Avesco ten years ago, we have worked closely together to build Avesco into a truly international business. With that work complete, we both knew the time was right for the Company to make a change. The parting has been amicable. I would like to thank Ian for his real contribution and leadership over the years. I know he wishes everyone at Avesco well and expects the Company to continue to go from strength to strength. The Board has asked me to dedicate more time to the business pending a decision regarding a replacement."
I am now intrigued by this line :- "...pending a decision regarding a replacement". Lots of different interpretations in those few words methinks.
I recently held shares in a company called Zetar which I have mentioned on this blog. It was recently subject to a takeover. Not long before the takeover approach Zetar announced this unexpected bit of news:-
"Our Chairman, David Williams, has announced his intention to step down from the Board at the forthcoming AGM. David played a pivotal role in the flotation of Zetar as an AIM listed company and has helped it to grow from a single GBP50m confectionery company to a confectionery and snack group with sales last year of GBP128m. The Board and, in particular, the Executives who have worked with him from Zetar's inception, would like to express their gratitude for all his guidance, support and the intuition he has demonstrated over these seven years and wish him every success for the future."
Umm........
I'm probably putting 2 and 2 together here to make 5, but make no mistake Avesco is cheap and is currently priced at less than twice this year's expected EBITDA. It's also worth remembering that Taya Communications are a 29.9% controlling shareholder and may eventually want to cash in their chips, so to speak, by selling the company on at some stage, although I have no insight into their long term intentions. Avesco attribute little intangible value to their company even though they have numerous prestigious clients. The current market cap. is little above the tangible value of their assets. As I said, cheap on any number of measures.
Clearly, the Disney case will need resolving one way or another, given the size of the possible payout, but once that's out the way....?
Anyway, just my idle thoughts which could be considerably wide of the mark.
As ever no advice is given or intended.
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
Digital Barriers
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
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
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.
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