The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
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The new ScrapRunner acquisition looks tremendous - just $2m cash paid for $0.7m of PBT and very high recurring revenues, plus no doubt cost synergies and opportunities for further sales to those clients who aren't already BRY clients: http://www.investegate.co.uk/brady-plc--bry-/rns/acquisition/201509070700232030Y/ Panmure have increased their target price to 129p (current price 96p). Forecasts for next year have been lifted to 6.9p EPS. Cenkos also say Buy today, and have further increased their forecasts after the excellent acquisition. And there's still room for further acquisitions from the £7m cash pile. The H1 results are obviously not great in themselves. BRY seem very confident that contracts signed in H2 will make up the difference for the year. In some cases I'd be somewhat doubtful about this, but I trust BRY's management, believe this to be a good company and am happy to hold. H2 news flow should be excellent assuming these "significant" contracts "in advanced discussions" come through. BRY's business is primarily about benefiting from volatility, not whether energy/commodity prices are high or low. Thus BRY's principal trading clients need BRY's products more, not less, in times of substantial price movements. Not to mention the growth and potential in Recycling. ...and of course BRY already has visibility on 80% of this year's forecast revenues with almost 4 months of the year still to go. Plus 55% of its income is recurring.
The July issue of Techinvest is now available free on their web site, so here's what they had to say about BRY: Http://www.techinvest.ie/downloads/sample.pdf "Brady (BRY; AIM) # 98.5p During the month Brady revealed that Fortum, one of the largest power suppliers to the Nordic/Baltic region, has chosen Brady’s Energy Data Management solution (EDM). Fortum Electricity Sales is a major energy retailer in Finland, Sweden and Norway, with over 1.2 million consumers. Brady boasts leadership in energy solutions for the Nordic market. In Norway alone, more than 60-70% of all physical traded power is processed via Brady EDM on a daily basis. Very strong hold / Add."
...and a great further endorsement for the company as the implementation of a global solution to these guys : http://www.bradyplc.com/news/global "Sims is the world’s leading publicly listed metals and electronics recycler. It has over 250 locations and more than 6,000 employees with operations encompassing the buying, processing and selling of ferrous and non-ferrous recycled metals."
Good new interview with the CEO here: http://www.proactiveinvestors.co.uk/companies/stocktube/3963/brady-boss-pleased-with-client-wins-and-forward-momentum-3963.html - 50% of BRY's business is with traders, who benefit from price volatility, which has been and is certainly present in recent and current times - the recent global metals contract is with one of the biggest metal trading companies in the world, being used by over 200 users in 9 global locations - the other recent contract with one of the largest recycling companies in the world starts with an AsiaPac deployment as part of an eventual global deployment of BRY's solution - the recycling sector is "absolutely enormous" - the Energy division is growing as it benefits from the move away from coal etc towards renewables, benefiting from the deregulation of European power markets
Every reason to expect further gains over time as the market continues to re-rate BRY, with growth in all three divisions, big contract wins and more acquisitions likely soon.
a super breakout here - 140p target.
Nice RNS today. This must be a very big contract, as we know BRY don't RNS all their contract wins, and they describe this one as "significant" for "a top tier multi-asset global trading house"..... Http://www.investegate.co.uk/brady-plc--bry-/rns/new-contract/201506240700079652Q/
http://www.bradyplc.com/news/global/scandem-selects-brady-software-for-energy-trading-and-risk-management Another good contract win - and being the winning of more work from an existing client a great testament to BRY's abilities and reputation. With £10m in cash to play with I'm expecting new acquisitions soon since it's been over 2 years since the last one.
RNS just out - Investec have increased above 8%, buying another 750,000 shares or so and now owning 6.9m shares: Http://www.investegate.co.uk/brady-plc/rns/tr-1-notification-of-major-interest-in-shares/201503191421039405H/ Since last August, Kestrel, Investec, Hargreave Hale and Octopus Investments have all increased their stakes here.
looking very good and nice write up in iii. regards
Many thanks for the link.Positive approach and comments from CEO.Maybe time will tell on this one,lets hope the breakthrough in Korea comes through.
Panmure Gordon increase buying price by approx.5% But very little movement in price,any thoughts/comments welcome
Great results - and slightly ahead of expectations, with 5.31p EPS compared to consensus 5.24p. Plus the 2.85p dividend is also ahead of 2.8p expectations. The whopping £9.6m cash pile was also well ahead of forecasts: Http://www.investegate.co.uk/brady-plc--bry-/rns/final-results/201503160700164641H/ The outlook is also very bullish, with a notable focus on potential acquisitions. Congrats to the team.
Results will be out 16th March, We already know they'll be good - and will show almost £10m of net cash to spend on acquisitions etc. Good to see Techinvest buying more too for their portfolio.
Thanks for the post regarding the interview with Gavin Lavelle. The figures are certainley moving in the right direction and Brady are spreading their business more and more Worldwide. Lavelle always comes over as a calm , level headed guy who doesn't over blow the achievements of the company. Very happy to still be invested in Brady, because I'm sure they have a bright future.
http://www.brrmedia.co.uk/event/133594/partner/TRADERSOWN Can't ask for more really: - high visibility for 2015 - great recurring income - large cash pile - good dividend cover - global business with 40% of business outside of Europe - first Korean deal, with major consumer electronics group - obviously LG! - increasing deployment of cloud for faster and more efficient usage - not cyclically correlated to commodities as used by traders and risk management
On the BRY web site: http://www.bradyplc.com/news/aludium-opts-for-bradys-cloud-solution-for-metals-trading-and-risk-management Great to see the new contract win for the use of BRY's solutions by producers and manufacturers. I saw BRY at their stand yesterday at the Cenkos show in London. Everything seemed positive and optimistic. I pressed on whether there would soon be news on further acquisitions, but of course couldn't get anything specific! It's been two years since the last acquisition. Given that BRY now have a likely £7m-£8m cash pile I'd hope and expect another one soon. And with results only just over a month away, which we know will be good, hopefully we'll see a run-up even without acquisition news.
Panmure Gordon have just issued a buy note and increased the SP target from 94p to 106p. 106p would in particular be extremely cheap for a predator, which is the endgame here imo. Currently I think they'd be happy to pay 120p-130p, but as the business grows and improves that figure will climb nicely.
Yes that is a nice surprise :) Not sure why there isn't more interest here. Can't see the G/E affecting it's trading and seems to be growing through new contracts. What is it I'm missing?
Excellent stuff - almost £10m cash now against the £66m m/cap. The 2015 P/E ex-cash here is now only around 11 or 12 - possibly 30%-40% below fair value given the strong trading, and certainly low imo given the high recurring income, market leadership, expansion into new sectors and geographical growth.
BRY is a Techinvet 2015 NAP tip (@78.5) with a rating of 9
Last posting by me was 8th Aug when I said I would not post again until Dec. Well I just made it but I cannot in all honesty say that SP performance has matched my expectation. However large overhang of shares on offer (from Blackrock) appears to have been completed----although it is impossible to be quite certain----which accounts for moderate rise in SP of late. Results to 31st Dec will be good and with continuing support from Panmure Gordon and Hargreaves Hale Unit Trusts a floor has been established. Expect more contract announcements and good prelims towards end Jan. I would not be at all surprised to see a good rise in SP in first half of 2015 to give us all a happy New Year.
and a sudden flurry of buys just now. Someone's keen o get in just before the year end. Hargreave Hale topping up again?