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Toxic its still a buy in my book but needs to show real traction in.the US college space before most will acknowledge the new market it is in. The updates after Setember when colleges are all back will be the real test the market should look at. Gaining another 20 or so colleges makes ALT a 100p plus share.
Please fasten your seatbelts
Yes Toxic as SCSW is not a guarantee of the future market perform of a share hence my Conservative view.
Weak buy?
Seems that SCSW has a write up on Altitude giving it a strong buy rating. After the recent good update it seems a very easy stock to pick for a tipsheet.
Well we got 'growth exceeding original expectations!'
""This financial year was one of great progress, strong trading and record breaking results. We increased market share in our core markets and proved to be a disruptive force in a new market. As a result, the Group has shown growth across the business far exceeding our original expectations."
Overall very positive
Let's hope that ALT can report numbers that will lift the Zeus projected numbers, it will need a very good update or newsflash to get the SP any higher in a meaning full way.
Have a look at Stevebryl on ADVFN who has an interesting thought line on FOUR and ALT
Https://masterinvestor.co.uk/equities/altitude-group-aiming-smarter-creates-big-potential/
Zeus have retained their 57.4p valuation and summarise:
"Trading update highlights strong start to FY24
Altitude has released a trading statement this morning confirming FY23 results will be at least in line with Zeus’ recently upgraded forecasts and trading in the first few weeks of FY24 has been strong. The upgrades put through at the time of the last update (28th March) were predicated on new contract wins in the Adjacent Markets Programmes (AMPs) leading to an increase in EBITDA expectations of 11.9% in FY24 and 24.2% in FY25.
The contracts underpin the strong start to the new financial year but encouragingly momentum has been maintained across the Group with both the Merchanting and the Services divisions continuing the positive performance seen during FY23. Zeus leave forecasts unchanged today, apart from a slight increase in FY23 net cash, but the strong start to FY24 provides confidence in estimates that factor in 47% revenue growth and 38% pre-tax profit growth yoy. Altitude shares trade below our valuation estimate, updated at the end of March, of 57.4p per share, offering 37% upside to last night’s closing price."
"Valuation: We continue to believe that Altitude shares trade at a discount to intrinsic value. Based on Zeus forecasts, Altitude trades on an EV/Sales multiple of 1.1x FY24, compared to a 1.8x average FY2 EV/Sales multiple for a broad set of UK small-cap software and services peers. Our DCF analysis provides a 54.9p per share valuation estimate and our discounted medium-term valuation estimate is 54.2p. The average of the three valuation estimates is 57.4p, which represents 37.0% upside to last night’s closing price."
Very nice update this morning - "significantly" ahead of last year is rather promising:
"initial trading has continued to be strong and is tracking significantly ahead of the same period last year"
And the USA-wide AMP roll-out augurs well:
"Merchanting continues to expand via its Adjacent Market Programmes (AMPs), which are progressing well with further contracts having been signed and other contracts now entering the final stages of legal negotiations . Currently, the AMPs national roll-out implementation has commenced in multiple cities across the United States, and we expect to provide further detail following the successful roll-out of our contracts towards the end of the first half of FY24 being September 2023."
If the run of company news continues to be upbeat in the form of beating market expectations the ALT SP might get back to the last equity offer level of 68p. ALT in my view is now a better prospect than back in 2019 when this equity was raised.
SCSW are again giving a write up on ALT suggesting it is doing better than its company broker forecast. If this is true and continues ALT getting to the 2019 valuation numbers could at last be on the cards.
Great to see per today's RNS the CFO investing around £20k of his hard-earned dosh in buying 41k more ALT shares. As the Board member with the most financial perspective, but usually by far the least funds, such moves are often meaningful.
And also to see 1.2m of MV's shares placed so easily with Simon Taylor. Which all bodes well going forward:
https://www.investegate.co.uk/altitude-group-plc--alt-/rns/director-dealing/202303290705015431U/
https://www.investegate.co.uk/altitude-group-plc--alt-/rns/holdings-in-company-and-director-dealing/202303290700065430U/
Zeus have today increased their forecasts, and have a raised 57.4p valuation:
Extracts:
"New major contracts and FY23 ahead of expectations
Altitude has announced multiple new contracts in its Adjacent Markets Programmes (AMP) that are expected to have a significant impact on Group revenue. Zeus adjusted EBITDA forecasts are upgraded 11.9% in FY24 and 24.2% in FY25 to reflect this. The Group has also guided that FY23 adjusted EBITDA is expected to be above expectations (£1.70m), so we upgrade by 8.8% to £1.85m. Today’s contract wins and confident outlook statement provide further positive momentum. Altitude shares trade below our updated average valuation estimate of 57.4p per share, 40.0% upside to last night’s closing price.
? Contract wins: The new contracts announced today relate to the Adjacent Markets Programmes within the Merchanting reporting segment. Starting in the first half of FY24, these multi-year contracts are expected to generate combined revenue of c. $30m throughout the respective five-year terms, providing better revenue visibility to the Group. The $30m includes $8m of signed contracts that are subject to US state clearance. In addition, Altitude is in late-
stage negotiations on a number of other contracts of material value to the Group, providing further upside and highlighting potential for continued rapid expansion."
"Valuation:
We continue to believe that Altitude shares trade at a discount to intrinsic value. Based on updated Zeus forecasts, Altitude trades on an EV/Sales multiple of 1.1x FY24, compared to a 1.7x average FY2 EV/Sales multiple for a broad set of UK small-cap software and services peers. At this peer mean FY2 EV/Sales multiple, Altitude would be valued at 63.1p
per share. Our DCF analysis now provides a 54.9p per share valuation estimate and our discounted medium-term valuation estimate increases from 53.6p to 54.2p due to the unwind of discount. The new contract wins announced today support the revenue estimates in our medium-term valuation analysis (£39.6m by FY26). The average of the three valuation estimates is now 57.4p, which represents 40.0% upside to last night’s closing price."
Wow the SCSW really made the market sit up and look at at Altitude, the writer really knows his stuff on small caps.
Wow - if Carlsberg did trading updates :o))
- ahead of expectations yet again
- major 5 year contract wins
- the year ahead looking very good already
- and the promise of more news flow to come:
‘A number of other major contracts of material value to the Group are in late-stage legal negotiations.’
Lovely stuff:
https://uk.advfn.com/stock-market/london/altitude-ALT/share-news/Altitude-Group-PLC-Major-Contract-Wins-and-Trading/90608673
There is apparently a write up on Altitude in SCSW which is upbeat for the company which should help maintain the recent upward trend for the SP continuing for a while.
Looks like the share tipsters who have recently given forth on ALT are on a winner. Another upbeat RNS currently due at the end of March should hopefully prove the tipsters right. Could be a share for decent appreciation by year end.
Zeus have upgraded FY23 revenues by 4.8% to £17.3m and adj. EBITDA by 17.2% to £1.7m. And I would assume they're being conservative in order to upgrade again after the end of March year end trading update.
Zeus conclude in today's research note:
"Valuation: Based on Zeus forecasts, Altitude trades on an EV/Sales multiple of 1.3x FY23, compared to an average FY1 EV/Sales of 2.0x for our broad set of UK small-cap software and services peers. Applying this average EV/Sales multiple to FY23 gives Altitude a valuation of 49.8p per share. Our DCF analysis provides a 52.0p per share valuation estimate and our discounted medium-term valuation estimate increases from 52.6p to 53.6p due to the unwind of discount. Our average estimate is now 51.8p, 54.6% upside to last night’s closing price."
They summarise today's update:
"Upgrading again
Altitude has released another positive trading update where results for the year to
31 March 2023 are anticipated to be materially ahead of current market expectations (revenue: £16.5m, adj. EBITDA: £1.5m). The Group has continued to expand its Services and Merchanting programmes, showing good underlying momentum, and has benefitted from a strong US dollar leading to greater earnings in GBP terms. As a result, Zeus upgrade FY23 revenue by 4.8% to £17.3m and adj.EBITDA by 17.2% to £1.7m. The US promotional product space remains strong, which is helpful, but Altitude continues to materially outperform the market. With its investment in Merchanting to date, a strong pipeline of opportunities, and expanded banking facilities, we believe the Group is well placed to maintain revenue growth momentum. Operational gearing should provide substantial drop through to earnings, as evidenced by today’s c. 36% increase to FY23 adj. EPS."
Always love to see that phrase - "materially ahead of current market expectations"....
And the outlook is as positive as can be:
""Following a number of positive market updates earlier in the year, we are delighted with this continued progress and are expecting to achieve record year-end results. In addition to our improved trading so far this year, we have invested in growing market share and have a reassuringly strong pipeline of opportunities. We look forward to updating the market further in the forthcoming months and to the next financial year with great enthusiasm."
Congrats to the Board (and to shareholders!):
https://uk.advfn.com/stock-market/london/altitude-ALT/share-news/Altitude-Group-PLC-Trading-Update/90226022
The way the US economy is going ALT with its income mainly generated there should be doing well. Let's hope for good news later in March to lift the SP for all holders who have had a bad last few years.
The way the US economy is going ALT with its income mainly generated there should be doing well. Let's hope for news in Marvh to lift the SP for all holders who have had a bad last few years.
Nice to share that and I am sure all long term holders would hope for the SP to rise from here. Last fund raising was at levels a long way above current SP.
ALT are featured in this week's issue of Money Week by Michael Taylor of Shifting Shares as a "top pick for 2023":
"Altitude is a technology company that provides services to the promotional merchandising and print industries in North America. The business owns the so-called AIM Smarter platform, which connects buyers, sellers, and manufacturers of promotional merchandising.
Naturally, the promotional events and merchandising sectors took a hit during Covid-19, but management managed to replace some of the lost revenue by sourcing PPE and hand-sanitiser suppliers and connecting them with buyers. Group sales are growing and the company reported last month that it was trading ahead of expectations.
House broker Zeus has forecast adjusted profit before tax of £0.5m this year. Valuing this company on a p/e basis makes the shares seem expensive, but that doesn’t factor in the rate of earnings growth and the mouth-watering long-term potential. This is a growing, $23bn industry, with roughly 75% of the transactions carried out offline."