I keep hearing about this company.......

An interesting contract win by a company called Eckoh Technology this morning:-

http://uk.advfn.com/news/UKREG/2015/article/69258952

The company has secured a significant new three-year contract to provide secure payment services to one of the world's largest multi-media retailers (the "Client"), broadcasting to over 200 million homes worldwide.

Nik Philpot, CEO of Eckoh, commented:

"I am delighted to announce this major new contract for our Haloh payment solution. Our payment clients' key goal is to protect their customer data without compromising customer experience. With recent high-profile data breaches highlighting the significant risks organisations take if they do not secure data effectively, we would expect to see demand for our technology only increase. To this end, we continue to evolve our products by developing the latest security systems and to make them flexible enough to accommodate the most challenging IT environments. Our latest tokenisation solution meets these needs exactly and we are excited that this household brand is the latest company to adopt it."

It would appear to me that Eckoh are in the right place at the right time. It's a company that I mentioned only recently:-

http://michae1mouse.blogspot.co.uk/2015/09/eckohs-of-my-own-investing-strategy.html

What's the current investment case for Eckoh though?

Clearly the company looks like it will continue to grow for some time to come, and for momentum traders there is a good chance that the share price will break out this morning and reach new highs? We shall see.

On fundamentals, the valuation looks a little rich for me with the forward p/e ratios for 2016 and 2017 at 36 and 27 respectively. However, further contract wins and broker upgrades may bring these figures down considerably of course.

The balance sheet is sound with modest debt, and the company pays a small dividend. The company is cash generative.

Interesting company to research further, but I won't be investing at the current price.

Software Radio Technology

Software Radio Technology is  a company that has fascinated me for some time. It appears to have a large following and always claims to have huge potential going forward for it's AIS technology. As yet, it has failed to impress. Success always appears to be just around the corner.

Today SRT released their interim results, and yet again they are less than impressive. Revenues are down nearly £2m on the same time last year, and they've made a loss of £750,000. Cash is ok at £2.4m on the balance sheet, but the valuation at nearly £30m is staggering.

However, hats off to the ever ebullient Chairman Simon Rogers. Never mind that the current order book stands at just £3.6m, get this, apparently they have  "a validated sales opportunity pipeline worth approximately £200 million." Well that's me in then!!!!

"A validated sales opportunity pipeline." Today's phrase of the day surely?

Good luck to current investors, and hopefully your patience will eventually be rewarded, but it may be a long time coming yet. 

BOOM

cgod - "We have a big seller pushing the price down, what do you make of this MM?"

Hello cgod. Not quite sure if you are addressing me or Market Master?

Here's a reply anyway whether requested or not.

When I buy shares in a company I do so at a price where I believe there is multi-bagger potential. I'm not interested in short term trading and taking a quick scalp. There have been occasions where this would have been more profitable, but overall I believe my buy and hold strategy gives me considerably greater returns in the long run. In short, I don't really care about short term price fluctuations.

In my opinion, Audioboom is highly speculative, but I have bought at prices I consider leaves multi-bagger potential should BOOM successfully execute on their strategy.

Their December update is all I'm interested in short term. If they report revenues around £500,000 then it suggests the latent potential remains firmly in tact.

Overall, once I have bought shares at what I consider to be reasonable prices, I have found the perfect strategy that works for my personality. Sit back and do nothing, and let the share price take care of itself.

Grafenia

Just one micro-cap to your draw attention to today which is a company called Grafenia. Essentially the company is involved in the graphic design and printing industry.

Grafenia released their interim results today which are a bit of a mixed bag. As far as I can make out, they appear to be in the process of re-positioning the business following structural changes in this particular industry? Certainly, they recently sold their Dutch subsidiary for 2.35m euros, and as a consequence, the business has been scaled down significantly.  For investors, I suppose it's a question of whether they can build the new model into a profitable and viable concern going forward. Today's report does give some encouragement.

In the first instance, the company does boast a healthy balance sheet. At the interim stage the company had £5.5m in Net Assets, although nearly £3m is made up of intangibles. Cash reported is £121,000, but this does not include £1.8m to be added to the coffers from the sale of it's Dutch subsidiary. The business is cash generative, but cash used in investing activities was up significantly at over £1m.

Grafenia have declared an interim dividend of 0.25p which is half it's previous dividend to reflect the reduced scale of the business. Last year's total dividend was 1.5p. If the final dividend is also halved then the yield will be around 5%.

In the narrative about the dividend they state that this "reflects the Board's cautious optimism for new initiatives."

Interestingly, later today both the acting CEO and the Finance Director bought shares worth around £60,000 between them. Perhaps they're a little bit more optimistic than they're letting on?

I haven't bought shares yet, but I will watch with interest.

N.B. I should mention that the current market cap. stands at around £7.1m.