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Although there was no news flow from Calnec -25% the funds largest monthly decliner, we can only put thjis down to what the broking community refers to as READ-ACROSS from the takeover of Spirent communications, which is held in the BVuffetology fund. the simple bear case would go something like this ; Spirent is Calnexs largest sales channel partner theresfore and change of ownershir will be depremental or disruptive to calnexs relationship. This is naturally something we considered durin our investment process and was an arewa of focus durin our due dilligance prior to purchasing the positrion. Spirent and Calnex have worked sucsessfully for over ten years. The hardware supplied via Spirent is all badged under the Calnex name, which is important as in the even of any change to the supply chain it is clear for the customer where the kit origonates from. Crucially calnex products are differentiated with capabilities that competitors can not easily replicate. Therefore we expect customers will quickly adapt to any potential change in distribution partner, as has been Calnexs experience in the past!!
Having said the below, the news of the takeover bid did overshadow the results at Spirent. There was an 80% drop in profit which was pretty brutal in 2023. Hopefully, 2024 has started more optimistically, but it mayvtake a while to filter through into results. Without a takeover, this may take a while to recover
Me too- I took 1/3 out of spirent as a hedge and put it here. I can't believe this share price will stay here for long. Either a takeover or, with the positive noises from the PMI numbers, things will surely move up from here. Either way, I'm expecting my portfolio to be a little rosier in a few months' time.
I topped up this morning Pedro, bit puzzled why the SP hasn't moved at all this morning.
Spirent take over at 175p cash.
I have reinvested some of the proceeds in advance into CLX
GLA
This share usually lags Spirent a bit(not a rule, but generally). Spirent just released a trading update and seemed to be hitting their (albeit downgraded) predictions for the year. Their share price has recovered a bit and it could mean these companies have seen the bottom of the market and are starting to see green shoots as the recovery happens. That's my positive take on it anyway
Brilliant little company.
Sold the 2nd buy of 11/10/23 back for 71p on 70p order, bep still shows as 68p.
Chart shows it topped soon after at 73.9p.
Maybe it will get back to my first buy of 99p on 4th October soon .
Sold the 3rd buy of 16/10/23 back today for 61p.
A Penny more then the second buy of 11/10/23 which I posted was a mistake that evening .
Only waited one month here .
Bep still shows as 68p.
P/L shows a nice profit ( actual )
Unrealised P/L.... a loss about half of above .( paper )
Total P/L.............. a larger figure then above profit. ( paper )
Good to see this starting to re rate.
Yeah Bwoy.
Announcing its interim results for the six months ended 30 September 2023 on Tuesday, 21 November 2023.
The management team will provide a live presentation relating to the results via the Investor Meet Company platform on Wednesday, 22 November 2023 at 1pm.
Well, I picked some up at around 41p.
I’ve had this company on my watch list for a few years- The accounts are a textbook quality company. Very strong cash position to see it through the recession. High Gross, Operating and net margin.
Consistent high growth rate - Until now, but it's a recession, what does one expect?
Hold for a few years, and I think this will again shine as a quality compounder.
A new product pipeline is also on the way.
If it was a Tr-1 holder selling, then a strong rebound should result.
Thanks Rippley :)
At least one institution is offloading, we shall see the TR1 soon.
Thomas (Tommy) Cook (CEO) 17,377,764 19.9%
BGF Investment Management Limited 10,515,500 12.0%
Close Brothers Group 7,912,957 9.0%
Scottish Enterprise 7,860,693 9.0%
Sanford DeLand Asset Mgt 3,200,000 3.7%
Liontrust Asset Mgt 3,071,359 3.5%
Hargreaves Lansdown PLC 2,935,218 3.4%
JPMorgan Chase & Co 2,672,782 3.1%
Grippa that is what my broker has as the break even price after my three buys.
Also info showing increase by 132% and two analysts is from brokers platform updated daily from previous days close I
assume.
Large volume just gone through- first attempt at a bottom I'd say
Talk of this hitting the 30's on the other board. Im surprised you bought again Ripley, though following your posts, you are normally successful. I think im happy not to catch the bottom here, and buy in a few more weeks time. (holding a few at 53p yuk). Market makers (on behalf of someone) are making this uninventable IMO, Buy today, they drop it 5% tomorrow, repeat. Might see a TR1 from reduction soon. ?
What is BEP
and whos showing increase by 132% please it this sinces profit warning or before it please?
Third time now at *45p this Monday , could not buy at 47.5p Friday 13th.
Bep shows as 68p.
Analysts 2 showing expect the price to increase by 132%. ( D )
From Fridays 0.475 to 101p.
Sliced VTU Thursday for 36% gain waited 71/2 years for that to start flowering .
Some say buy the rising share , be interesting to compare this move in the future.
Main market down 2% today, Israel ready to invade Garza concerns , on top of all the other bad news over past year.
So it's just made up and not company-given guidance.
Just before I sign off and leave you in peace, a quick note on a fluctuating SP for the next 12 months.
First thing is, I’ve come to strongly believe that after a negative trading update, it only qualifies as a genuine profit warning if the SP drops at least 20% - on the day of the announcement!
(I’ve often seen x40% drops on the day of the announcement, but the research papers/ebooks say to expect a minimum of x15%). I’ve always found in general it’s a lot more than x15% so just rechecked Oct 10th SP to be sure
- it opened at 94.6 and closed the day down at 66
- so that’s the top side of a clear x30% drop in one day, easily beating my preference for a 20% drop. So no doubt about it.
2nd thing now the SP is definitely a victim of an official Profit Warning is that the SP will attempt to rise over the next 12 months but it will be quote: “unreliable”.
Some may attempt to draw new conclusions if it rises considerably - and here is the 2nd point - it’s my highly personal opinion - you won’t find it any research papers, it’s my own observations over the years - no matter how high the SP rises I’ve always found it never exceeds past the SP that was present on the day before the announcement - (for the next 12 months) - and that was a very flat open-and close of 95p.
(If it does - please hunt me down and haul me back here, as it will aide my own research).
What that means is, I can certainly entertain the notion that over the next 12 months the SP may visit the 50’s, 60’s, 70’s or the 80’s - but in my opinion it will never exceed (or reach) the SP that prevailed on the day before the Profit warning was issued - which as said was sitting at 95p all day.
My opinion? The SP may never reach 95 let alone exceed past it - at least for the next 12 months. (Hope I don’t come to regret saying that :)
And any further downside to the SP from here? - well that is anybody’s guess. The situation is too unreliable to be more confident.
Earnings? - from Stockopedia (subscription access only).
Sharepad is the main alternative, but that’s even more expensive!
I did trial Research Tree (analysts) for awhile, but was running up too much expense, so cancelled it.
I’ve been with Stocko since 2016 and on the whole have come to trust their data.
- - - - - - - - -
You can get very limited free access though, to things like Simply Wall Street.
Here’s a couple of current copy/paste snippets from S/WStreet on Calnex:
Highlighted with a red warning is -
“ Earnings are forecast to decline by an average of 88.9% per year for the next 3 years “
&
“New major risk - Revenue and earnings growth”
Earnings are forecast to decline …for the foreseeable future.
This is considered a major risk. Ultimately, shareholders want to see a good return on their investment and that generally comes from sharing in the company's profits. If profits are expected to decline, then in most cases the share price will decline over time as well.
This is currently the only risk that has been identified for the company.”
Where are you getting your earning figures from?
Well, what a bl@@dy awful mess since I last looked in on my little fav, CLX! Geezalou!!!
In the early days when this forum was just a few months old, I did opine that the PE ratio was too high and therefore far too rich for me - and soon regretted not buying, when I realised bona fide growth stocks are allowed to sport high PE ratio’s - as long as they deliver the goods.
Deliver the goods? Well that’s not gonna happen for the next year or two. If it was too high back then, it’s current forward PE ratio is in Tesla-type stratosphere heights of fancy. It’s showing a forward PE of just under 70 based on the new future reduced earnings guidance. Anyway, let’s get the bad news out of the way.
I believe 48p was the CLX’s IPO launch price - so as of Friday, it’s back to the starting grid and Day-One, all over again.
I’m seeing fair value given in some quarters via the DCF metric as a staggeringly low 12p. I would tend to double that to 24p as a potential low as it’s not uncommon for many IPO’s to fall to half their launch price within their first 3 years, before continuing.
Earnings are forecast to drop from last year’s all time high of £5.91m, to £1.35m for ‘24
- with 2025 showing even worse, of only £0.2m !
That’s the second profit warning this year so the SP will be v unreliable for the next 12 months. True Long term holders can buy the dips (small amounts each time as SP unreliability makes the floor questionable in that 12 months).
Although the RNS said:
“REVENUE FOR FY24 WILL BE IN REGION OF 20-30 PER CENT BELOW
CURRENT MARKET EXPECTATIONS
IN FIRST SIX MONTHS OF FY24, COMPANY'S ORDER INFLOW HAS
REMAINED
AT SUBDUED LEVELS
H2 FY24 WILL BE SLOWER THAN ANTICIPATED.
CONFIDENT IN A RETURN TO GROWTH IN FY25 “
- the market has already decided and forecasts for ‘25 are for a measley £200,000 in earnings.
So anyone’s guess when a bounce may occur. No doubt there will be ultimately - but not in the next 12 months, barring occasional short-lived false-positive rises.
This is beyond the control of the company, so not a management fault issue. All companies go through these swings. It’s not an insolvency issue.
Have a plan if buying dips - not gut feelings or endless random guesses of: “This is the floor”.
The company will survive this but clearly it’s going to take a year or two. Profit warnings nearly always turn out to be worse than the initial RNS leads you to believe. The forecast guidance for ‘25 earnings is truly shocking. Wasn’t expecting that.
Still have a soft spot for CLX -
BUT first things first - the H1 trading update will be published next month round about the 21st November. All market forecast guidance will be revised by the market after that is received.
Even if I wanted to buy right now - I would never buy before a trading update is due to be released, unless I had some sort of information that no one else had.