Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
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DaddyAIM....recognise you as a fellow centralnic backer so nice to see you here also. Cannot believe the share prices for these two companies......continent wide valuation discounts!!!
*last week
looking at the trades - these are small and the selling pressure has been driven by RETAIL selling.
I have been buying almost everyday this week...
According to the FCA daily tracker there are no short positions in Kape. (There might be some very small ones under the disclosure limit but nothing serious). So it’s unlikely to be that. I’m as mystified as everyone. Perhaps traders have got into it and we can now expect some volatility both up and down.
Most likely. It’s like the market, under any circumstances, cannot give you 40% without taking it back again. Despite us being down 32% on the yearly chart. And on the back of that trading update! Insane.
Let’s hope some good news drops to give this a kick start. They have $222.5m to spend after all….
Honestly think it was being shorted. I took some more at 256, seems a good entry level, back to the 50 day and 100 day averages - and also a prior key level which should start to act as support. Might go lower, you never know, but its been dropping 2 weeks now, hopefully returns are diminishing for shorters as the price gets more of a buy opportunity.
Why does this share keep tanking? There seems to be no obvious reason. It should be rocketing to the moon? Sometimes the markets are a puzzle?
It is indeed and so annoying to see capital wiped off when you could buy cheaper. However...as we both know its impossible trying to time the market - all one can do is be lucky enough to get to invest in truly undervalued businesses where there is a real chance of significant multiple and earnings expansion over the medium-term. Definitely the case with Kape and CNIC....anything under 3 quid for Kape in my view is a complete steal...my average 2.40 and believe that it will pay in droves over next few years.
Ggrantsu, I was just venting. It’s so frustrating when you buy and then watch it immediately tank.
Saving some dry powder now for a lower top up. And also an entry point with CNIC.
Ha I feel for you Pompal!! Although frustrating....just keep in mind that this isn't some gamble in the dark. Company's valuation is continents apart from fair value - honestly in this UK small cap market with these kind of companies like Kape and CentralNic...I'm taking the view that I actually want to see the SP's crash...because its the closest thing to a money tree if one is patient. While these companies grow in high double digits organically and throw off cash...then I welcome being able to pay low single digit multiples to own them.
The moment I thought the fall had stopped and bought more, almost instantly a vertical drop. Shocking.
Certainly been completely bizzare Pompal...I was thinking on day of results we'd see a rebound from yesterday onwards instead...like happened with CNIC recently (the other absolute star performer on AIM). But no...down down down.
Like you though my vision has shifted....if Mr Market wants to **** around then I'd rather they just took us down to sub 2 quid....in the future it will prove to be the closest thing to helicoper money....a star performer being bought for pennies. Will just keep ploughing more in while we have this golden opp price discrepancy...
goldbar2
It’s shocking, isn’t it? You’d be hard pressed to find a company that are delivering as per their tu, over the past year and when the majority are in turmoil. Yet the market punishes them. I’d hate to think what would have happened if they’d posted a mediocre update!
The market is broken but I have more faith here than with any of my other holdings. It’s definitely a hold and I’ll be adding a whole lot more, should we sniff around the 260 mark.
ATB
Great share - good news - and the share price drops - don't follow!
Completely agreed chaps (about both KAPE and CNIC!). In these times it may just be an institutional seller who needs cash to aid liquidity from fund liquidations etc. KAPE are surely certain to be tipped in various quarters over the coming days and weeks - there should be lots of interest at this silly multiple.
Here's a final nice extract from Shore Capital's new note:
"Perspective on 2022
The full year earnings growth, 122% on a pro forma adjusted EBITDA basis, reflects an unswerving commitment to driving organic growth from new customer acquisition and upsell opportunities whilst also successfully executing on a highly ambitious M&A programme.
Over a longer period, Kape’s development is also impressive. One key metric – the SaaS user base – has advanced 28x in the past five years, from 260k at year end 2017 to c. 7.4m as at 31 December 2022. Such growth reflects Kape’s proven ability to leverage its digital marketing engine in addition to its capacity to execute on strategic acquisitions. Notably, both Private Internet Access (in 2019) and ExpressVPN (in 2021) had the effect of roughly doubling the user base while also building out a strong presence in North America (now c. 47% of users). At the same time, Kape’s revenues and adjusted EBITDA continued their rapid ascent, as reflected in FY19A-FY22A CAGRs of 111% and 128% respectively.
Clearly, share price performance is another important metric. From c. 40p in early 2017 to 299p today – a CAGR of c. 40% - Kape has delivered outsized returns for investors reflecting strong strategic execution. Below we contextualise both subscriber growth and share price performance.
While Kape has made remarkable progress to date, the ambition, focus and drive within the company remain as high as ever. These should not be underestimated. As the Company continues to scale up, both organically and in-organically, it ought to generate an even stronger platform for delivering growth and shareholder value.
Valuation and view
In our view, Kape continues to tick many boxes for investors as a high-growth SaaS business with market leading brands in a global target market, providing exceptional midcap exposure to one of the key themes in IT – digital privacy and security. The Company also deserves credit for consistently strong execution and profit delivery versus market expectations.
At 299, Kape trades on 8.5x EV/EBITDA for FY23F (versus 5-year mean of c. 13x) and a PE ratio of 9.4x (versus 5-year mean of c. 20x). The upside potential continues to be supported by cash flows and the earnings growth potential coming from secular organic growth in digital privacy and security, through acquisition potential and through further leveraging business performance driving margins higher. Altogether, we view Kape’s current valuation as extremely modest for its growth prospects and strategic sure-footedness."
Keep in mind also....we had something similar with Cnic a few months ago - delivered probably the strongest set of AIM / LSE results all year and went down like 15%. These market makers etc want your shares and expect retail investors to be short-termist and sellout easily off the back off the SP not responding. CNIC from the day after went on a run of +30-40%. Be patient and take your comfort from the numbers.
Not sure what to say to co-dissapointed shareholders this morning...I woke up late having been told that this update was coming on the 23rd. I'd actually expected the results to be weak given the environment and was concerned after reading across from Darktrace. But no...this exceptional company delivered record results amidst the worst environment since 08 meltdown.
I'm not sure what they need to do / are expected to conjure up. Absolutely continent wide mispricing here, along with centralnic. I can only look at bright side...the longer these kind of stellar future NASDAQ darlings stay woefully undervalued, the longer it provides private investors to load up. Probably the only positive (alongside these unbelievable numbers) that I can take from today.
Stay strong!!
Progressive haven't even bothered to update their forecasts in today's update note, which is a tad lazy!
Shore Capital have now upgraded to the flagged $173m EBITDA, giving rise to an increased 40c EPS, i.e at the current $1.22 that's 32.8p historic EPS.
Which is a historic P/E of just 9.1.
Shore Capital conclude:
"Kape earned its success in 2022 by providing a premium service to a growing customer base whilst also building customer value and retention. These dynamics will continue in 2023. In our view, the Company appears well placed with a large base of recurring revenues, healthy SaaS metrics and strong growth prospects serving the increasing demand for digital privacy and security.
Forecasts and valuation: The performance confirmed pulls through a 2-3% upgrade to our pro forma adjusted EBITDA and EPS estimates for FY22F. We will consider our forecast model in detail when greater granular information is available at the time of the FY results on 21st March, including the outlook for FY23F and FY24F. We see the shares as highly geared towards creating a global leader in digital privacy and security, and the associated milestones and earnings growth. Progress in FY22A bodes well, and we also note the potential for further in-organic expansion. At 299p and 8.5x EV/EBITDA for FY23F, the stock appears undervalued relative to historic multiples, underpinning attractive risk/reward, in our view."
Yep, cracking update and the markets response is that we’re about to go red! You couldn’t make it up. Clearly this was priced in with the rise over the past month but still, we are way too cheap. Guess with this market, all metrics go out of the window.
I have a feeling some pretty big news is forthcoming, judging by Ido’s comments.
GLA.
Great stuff :o))
EBITDA will be ahead of Shore Capital's expectations by at least a good $4m and revenues will be at the upper end.
So EPS is likely to be say around 33p, putting KAPE on easily a single-figure historic P/E.
In addition, "The integration of ExpressVPN has exceeded expectations" with lots more synergies and saving efficiencies to come this year.
And worth noting - the Notes to the RNS state KAPE now has 7.4m subscribers - up 400,000 since the last 7m total on prior RNSs.
on Friday night:
Https://citywire.com/funds-insider/news/david-kempton-my-seven-exciting-stock-picks-for-2023/a2406612
"Kape Technologies (KAPE)
This £1.3bn cybersecurity company develops and distributes a variety of digital products in the online security space with its own virtual private network. In the first half to June, recurring revenue rose 350% representing almost 90% of total sales. Strong cash generation from its 7 million customers should enable the current debt, occurring from acquisitions, to be paid off quickly. Still on a P/E of 8 and PEG 0.8."
I've just confirmed with company - 23rd January. Funny as well the language used 'we are much looking forward to sharing our results with shareholders on the 23rd' - don't want to be a spiv and read too much into stuff but that to me sounds like a very positive tone...
Has anyone at all heard anything re trading update date? They provided one 10/11th January last year so obviously due any minute....
Hopefully getting set for a further run-up back to 350p-400p now. With 32p EPS forecast KAPE remain on a ridiculously low P/E at 288.5p for a cybersecurity company with terrific cash flows largely paid in advance and large recurring income.
DARK had no effect here then, which I thought it might do