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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.
Just as an FYI. I placed three buy orders at 48.x pence this morning and they all show as sells (as they would). The buy/sell ratio cannot be trusted.
Down a further 6.73% this morning with a 6.34% spread.
Odds favor the brokers / MM
In hindsight should of waited for the bottom which today was 52p spread 4%
Got a few.
with cash at the end of September 2023 of £13.5 million, following investment in inventory.
That is about 15p per share. If you can sit on these for a year or two, probably multibag.
I sold at 131 in August for a good profit but did not want to be out of this stock for long and bought back recently at 105 after falling back. A fall in the SP was to expected after the warning but the magnitude of the fall I think is too harsh as prospects for recovery at some point is good. No guarantees of course but with Canaccord dropping SP forecast to 110p and an SP hovering at around 55 I view this as positive and bought more to add.
Down a further 12% this morning with a 7% spread.
Funds finally in from Curtis Banks Group PLC take over yesterday covers the bet .
Doubled up.
Placed order to top up at 63p executed at 60p 9am .
Thank God I deleted a previous similar order last night .
RNS was at 3.17pm which explains the late drop on chart .
FT100 was up 2.26% on Labour leader speech .
Market must like the idea of change of government .
Got this wrong last week on Spirent Communications down 31% the read across was a sale not buy
Today with there own RNS "Calnex Solutions shares dive 30% as predicts revenue underperformance "
Another new one for me at *99p 2% spread.
Spirent Communications down 31% these down 15% .
Made note of link and tried to buy on 12th April 2023 after Spirent big fall that day.
Must of been wiling to pay around 117p then can not get order to show , today matched the 19th May low off 99p.
Mid August they retraced to 140p
Does Spirent CloudSure have its roots in Calnex? Anyone know?
Dartron, thanks for that link/update in your post.
Tipped in Shares magazine, they say £1.80 next 18 months. I think we will see this far sooner personally.
https://twitter.com/SHARESmag/status/1687039689750880256?s=20
Could good RNS coming, takeover or people seeing a rise in share price and just getting on board knowing this is likely a good company for the longer term. Time will tell. Always liked Calnex and traded the share profitably. Last holding bought at 117.69 quite a while back so pleased to see a profit now. A stock I do not want to be completely out of at any time.
Moving up on low volume, no sellers down here. My target here is around 1.40 very soon.
Perhaps the update from SPT has helped a little.
Not many buys, but moving up? RNS trading update in the post?
Spirent have just posted an RNS with pretty positive noises about q2. Should bode well for Calnex too
This hit 1.30 last week, 3 days running. This is going to have no problem getting back to 1.45, then posssibly more if the update is good.
Appealing chart, short term, because the relative strength indicator crossed above 50, which is bullish. However unfortunately there is a major down trendline at 125, and also a major previous low also at 125. The coincidence of those two factors at the same price, makes this a weak buy. Admittedly there appears to be a significant base before the most recent price action , but the sp, would need to get past 125, before confidence of further rise was given.
Raydio. Up, up slowly will do me.
I agree that something "must be in the air" in view of the rally in the share price. I am thinking the lyrics if a song by 5th Dimension aptly apply to recent rally and hopefully get to new highs on what news is coming.......hopefully.