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Seems to be a re-rate going on, gathering pace.When it’s going to stop ! No idea
It’s quite unbelievable, isn’t it? Can’t even sniff a green day, even when the wider markets are up. And for a company seemingly doing everything right.
It has to turn at some point but needs a catalyst. Just wish I had dry powder!
So surprised to see shorts shooking their prey?
'.......The recent interim results reiterated the full year outlook, implying 117% pro forma adjusted EBITDA growth at the midpoint of the guidance range, and the mediumterm growth potential for Kape remains high (including broader scope for acquisition opportunities following on from the $222.5m placing completed in September 2022). We believe earnings risk is low, and risk/reward is materially mispriced.
Gap on chart at 180......short term target- but most small caps in UK very weak.....Could be fund liquidation.
Does someone know something here? Massive sells are relentless, even at these levels. Shocking.
Resist Americanisms.
So at 272.5p the analyst at Singer thought these shares were a “knockout”. And here we are more than 10% lower. Go figure!
You might be interested in MWM from Master Investor's take on KAPE post-placing which I've just come across:
"Kape Technologies (LON:KAPE) – heading to 400p?
Following the massive ExpressVPN acquisition late last year, this digital security and privacy software business enjoyed a strong first half to end June this year, with sales up 216.6% at $302.4m ($95.5m), of which $268.0m ($59.1m) were recurring revenues.
EBITDA was 209.7% better at $88.9m ($28.7m), with EBITDA earnings of 34.1c (9.0c) per share. Cash flow was 517% improved at $90.1m ($14.6m).
Kape expects to deliver on its growth targets, to focus on organic growth engines, as well as continue to execute on its successful in-organic strategy assessing selected M&A targets to accelerate that growth.
The group is now expected to generate revenues of between $610-624m and EBITDA of between $166-172m for the year to end December 2022.
There has been strong demand for the enlarged group’s privacy and security products, coming from new customer growth and from increased upselling within the group’s client lists.
Analyst Caspar Erskine at Singer Capital Markets rates the shares as a Buy, with a price objective of 450p.
He is looking for the next year to end December 2023 to show revenues of $688.3m and EBITDA of $192.6m, kicking adjusted pre-tax profits up from an estimated $126.5m for this year to $165.3m next year, hoisting earnings estimates from 31.8c to 41.3c per share.
On the back of these results the group’s shares lifted to 297p in reaction, a 37p increase on the day.
Then yesterday morning the company announced that it was handling an institutional and private investor Placing to raise between $110m to $200m, by way of the issue of new shares at 265p each, with the funds being used to enhance its capabilities to ‘accelerate its growth through acquisitions.’
Billionaire founder Teddy Sagi’s IOM-based Unikmind Ltd, with 53.7% of the equity, is taking up $110m worth at the price – I just love this guy and the way he handles his business – certainly never to be underestimated.
The shares fell 21.p to 272.5p on the back of the Placing news – at which price I reckon that they are an absolute knockout not to be missed."
Great to see KAPE getting some attention - here's a direct link:
Https://www.thetimes.co.uk/article/share-tip-investors-may-fly-with-this-kape-h83w7hfrb
'Stock picking in the London market feels like trying to track down a leaf in a hurricane. International businesses are gearing up to pounce on a fire sale of newly cheapened British assets.
As ever, technology is at the centre of the storm. High-growth tech companies have already been consumed by foreign suitors in recent months, including the software maker Micro Focus and cybersecurity firm Avast. France’s Schneider Electric is circling software developer Aveva, and a US buy-out firm is doing the same at GB Group, which makes anti-fraud technology.
Speculation is rife as to who is next. Any target would need to prove that it can grow over time.
Step forward Kape Technologies. The company is only five years old, but has seven million paying subscribers to its digital security software products, including virtual private networks, which encrypt and protect internet connections, and a string of software brands that protect against viruses, trackers, nosy apps and malware............
..........The firm’s price to equity ratio is forecast to be only 7.4 this year — “the valuation multiples appear extremely modest and attractive,” says Martin O’Sullivan, an analyst at Shore Capital.
Kape’s share price is down 43 per cent this year — it peaked at 444p in March and is now about 250p — a victim of the economic hurricane which contrasts to its operational strength
Investing in the firm is one of the few remaining opportunities for exposure to high-growth, home-grown UK tech: Buy.'
Exchange rates now make us even more ridiculously cheap for an American takeover.
Short term Kape looks to be following Centralnic's recent trials in being unable to get above their recent placing price.
In other news, JPM's short not looking so stupid now.
We’re almost down to the highs of July 2020, before the ExpressVPN acquisition. And our current mcap is less than the purchase price. Quite unbelievable really but I’m quietly loading, when I can.
There’s another acquisition imminent IMO and I wouldn’t be at all surprised if we weren’t on someone’s radar.
ATB.
The good news from the 16/9 RNS re the options grant is the indication that the founders of ExpressVPN are happy to stay with KAPE for the long term - and that the option grant is dependent on the achievement of the $30m of annualised savings post-acquisition.
That RNS also notes that those savings are being achieved ahead of expectations.
Great to see that the placing was "significantly oversubscribed", and that the directors and employees invested heavily in the fundraising to the tune of around £1.5m.
Hopefully this means there'll be good post-placing demand for the shares in the market - as perhaps is being shown today.
JPM must be a set of mad ****sunts.
That short has to be based on sentiment because, Christ alive, on the fundamentals, this has a one way ticket to £10.
Get another scandalous wretched board of king ****s.
Really pleased to see that you can now apply for placing shares directly with your broker [in my case A. J. Bell] rather than having to go through Primary Bid. The main advantage of course being that you can use funds in your SIPP or ISA.
Happy to top up here at this price.
Great news. Expect to see an acquisition announcement within days, IMO.
Just speculative thinking, if JPM participate in new share placing they may easily close their short position next month when new shares will be allocated.
Today announced/confirmed "Proposed Placing at top of range - raising US$200m" - that's a vote of confidence I think. GLA.
I think thats a bit OTT. Can see the rational that this is an area in which scale wins out...and in difficult times will be able to pick stuff up on cheap (especially in tech markets)...so I think thats a little short sighted. Valuations nothing like back then and this company and its previous targets have been bought on value stock like multiples for high growth and ridiculously high cash conversion...
My only point is that VPN was big...perhaps a bit more patience would make sense till it beds in. However, this is an astute team and a team who look long term...I've got confidence.
Remind me of year 2000, unlimited and uncontrolled acquisitions. We all know what happened next.
ExpressVPN might be an exception. But dont expect it will happen again.
The price of Teddy Sagi pumping in another $110m? He placed at 3.35 last time so probably taking the opportunity to average down. One would imagine it is a safe bet for him. Patience required but will surely be rewarded.
It's potentially the case...corruption and insider trading at these levels is rampant so wouldn't surprise.
Its a tough one...I really liked the ExpressVPN acq. - it was needed and gave the company an unbelievable platform.
However...I think it needs to be bed in more before more acquisitions take place personally. I could be proved wrong...
Still believe holding this for 5 years will make you rich, along with centralnic.