The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
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"Rothschild is not famous for being an idiot".
Well, up to a point. He's hardly the sharpest knife in the family drawer, as he amply demonstrated in the Bumi fiasco.
By Edward Sheldon, CFA. There are several reasons I’m bullish on Volex (LSE: VLX) right now. One is that the company is growing at a healthy rate. For the 26 weeks to 2 October, the group posted year-on-year revenue growth of 22.1% along with 14.1% growth in underlying profit before tax. Results were boosted by 53% organic revenue growth in its electric vehicle division.
Another reason is that management has ‘skin in the game’. Both executive xhairman Nat Rothschild and COO John Molloy own a ton of Volex stock. So, it’s in their interests to get revenues, profits, and the share price up.
Finally, the stock is dirt cheap. With analysts forecasting earnings per share of $0.27 for the year ending 5 April 2023, the forward-looking P/E ratio is only about 13.
Risks here include debt levels, which have risen on the back of acquisitions, and excess inventory issues. I like the risk/reward proposition at current levels, however.
It's the net debt at $117,000 that is the problem. That's a lot of dept compared to the profits and these days heavy debt is a bigger risk than it was and must be paid for.
Due anytime
Nathaniel Rothschild should be buying at these bargain prices
Bought more today
The continuing fall seems unexplainable. The fall doesn’t seem relevant to any general factors
Maybe at the moment, but I see no bad news in this one. The numbers are entirely positive in trend. And Rothschild is not famous for being an idiot.
Momentum on this has dried out and lately seems to be heading pretty much in one direction only.
Perhaps general market malaise. Noted that Tesla and BMW will be starting production in Mexico once their factories are established which bodes well for Volex who have a facility in Mexico.
Any reason why this is falling
Wouldn’t have thought so, it’s about 500 miles from epicentre. Not that we should worry about such inconveniences given what others are suffering !
Anyone know if the factory was damaged from the earthquake?
Great buy at this price
Today a factory visit and presentation to follow which may bring some momentum to this share which has been in sleepy hollow for too long.
U
S inflation for October came in at 7.7% year-on-year, lower than the expected 7.9%. It’s down from the 8.2% rate recorded in September.
October’s annual inflation rate is expected to ease to 8%, having been 8.2% the previous month. The Fed has unleashed a series of 0.75% rate rises in response to soaring prices, but Wall Street is looking for a more modest increase at next month’s meeting.
https://www.investorschronicle.co.uk/news/2022/11/09/evs-drive-growth-at-volex/
Tripling of debt and only $100k FCF probably explains the drop.
Nice and steady growth in all areas in difficult times, yet the SP drops 8%.
How I long for the days when we had MM's who understood companies.
I just added at 252
I did warn of this possibility yesterday, hoping to be wrong.
surprised at the fall off here today...how could these results be any better?!!
divi increased and this caught my eye:
“Electric Vehicles - strong momentum continues with 53% organic revenue growth delivered through a diverse product set.”
A resilient set of figures given the times we live in when many others are highlighting inflationary pressures to mask poor management controls.
Will add on any SP slippage.
Cannacord says: Trading in line with FY23E expectations after a good H1, which provides 51% sales and operating profit cover relative to our forecasts. Sales was up 22% y/y to $358m (14% organic) with a 9% margin, which is in line. Cites robust demand across all end verticals supported by new contracts with new and existing customers, with EV growing 53% y/y and consumer electricals delivering 3.6% organic growth despite challenging markets. Trades on a CY23E P/E of 12x and EV/EBITDA of 7x, which is a 30% discount to sector average. If trading holds up, we expect to see upgrades to guidance later in the year and we think the shares look too cheap as a result