The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Simon Thompson of Investors Chronicle has done a further write up regarding MPAC.
The article reiterates the recent figures from the annual report regarding rising orders, increasing margins, cash levels and growth markets.
The article concludes"
"However, the shares still only trade on a 2021 price/earnings (PE) ratio of 17.5 (cash-adjusted 15.5 times), an unwarranted nine-point ratings discount to the UK engineering sector average and one that suggests my new target price of 700p is achievable. Buy."
Enjoyed this.
I only recently bought MPAC, but happy I did. Its on my watchlist to buy more when I have the funds
We hosted an investor webinar on 2nd September with the management of Mpac Group plc. Tony Steels, CEO, and Will Wilkins, Group Finance Director took us through the detailed highlights of their promising Half Year period and answered questions submitted by investors on growth prospects, capital allocation, the new contract with FREYR and much more.
Click on the video below for the full presentation recording (approximate length 59 mins).
Link: https://www.equitydevelopment.co.uk/research/mpac-interimresults-presentation-sept2021
For the six months to 30 June 2021 Mpac Group reported a strong recovery in both orders, +69%YoY, and revenue, +20%YoY, as a result of which we have raised our FY21 revenue outlook from £95.0m to £97.5m (+16.4%YoY) and for FY22, from £100.0m to £105.0m. We have also raised our fair value / share estimate from 600p to 660p.
https://www.equitydevelopment.co.uk/research/fy21-interim-results-a-strong-rebound
Mpac investor webinar - 2nd September (11.00am).
Join us for a presentation by CEO Tony Steels and Group FD Will Wilkins who will conduct an investor webinar following Interim Results - the event is open to all and will be followed by Q&A - sign-up below!
https://www.equitydevelopment.co.uk/news-and-events/mpac-interim-presentation-sept2021
Odd sequences of numbers on the sells. I know nothing about these things but I suspect an institution has been taking profits. More fool them as far as I'm concerned, but I suppose they have to, to maintain a balance, while we can choose to chance it. But IMO yesterday's news was very good. Maybe they do it at a time like this so the large amounts don't start a downward slide and destroy the value of the rest of their holding. MPAC was 48p less than 5 years ago.
Just wild ignorant guessing.
Yes, I'd always focused on the packaging side of things - ubiquitous and important.
But this as you say elsewhere seems to be another vertical, using the automation and packaging expertise as part of the manufacturing process itself - if I understand it right. Great!
NB it's for the 'Customer Qualification Plant'. But I'm interested in this in the RNS:
"The contract with Mpac also grants FREYR options for delivery of the casting and unit cell assembly equipment packages for FREYR's planned Gigafactories."
And this from your 'Life in Norway' link below:
"The money raised will be used to build new factories in Mo i Rana, an industrial centre in the north of Norway. “We believe this is one of the largest industrial investments in Norway in the post-war period. Some say it is the biggest,” Freyr CEO Tom Einar Jensen told NRK.....
Norway is well-known as a leader in electric car sales and infrastructure development. Several companies are also taking an interest in electric-powered aviation.
But it's now looking increasing likely that the country will play a big role in the production of the batteries needed to power the electrification revolution.
Freyr is developing lithium-ion based battery cell facilities to supply high energy density and cost-competitive clean batteries to rapidly growing markets.
The company will take advantage of Norway's established low-cost, renewable hydropower and in future, wind power, to keep costs low and production green.
Interest in the Mo i Rana based company has grown quickly. Now it plans to use the money raised to build five gigafactories in the Mo i Rana region, which could bring thousands of much-needed jobs into Northern Norway.
“We have secured several plots of land in the industrial park at Mo, including a building by the quay where we will start a pilot factory. Then we will build four new factories in quick succession,” said Jensen.
In the new facilities, Freyr plans to produce battery cells equivalent to 800,000 electric cars annually. Jensen hopes to have the first production up and running in 2022.
If MPAC is involved in all of these......... Boom?! :)
Agreed re potential . The FREYR contract establishes MPAC at a key point in developing commercial battery supply. Earnings outlook benefits longer term: the new Equity Development note retains estimates + fair value of 600p/share
Free access to read it here: https://www.equitydevelopment.co.uk/research/clean-energy-equipment-contract-win
Yes, this is huge. Norwegian Freyr listed on the NYSE earlier this month. Market cap $1.2billion. MPAC Market cap £107million.
https://www.lifeinnorway.net/freyr-battery-nyse-listing/
Looks like a great contract for Mpac
Simon updated after market closed today.
https://www.investorschronicle.co.uk/ideas/2021/07/09/bargain-shares-engineered-for-a-strong-recovery/
New target price of 600p by March 2022.
GLA
In its Trading Update for the six months ended 30 June 2021 Mpac reports that the upturn seen in H2 2020 has accelerated with H1’21 order intake well above that a year earlier - which had suffered the impact of COVID-19. The update highlights:
Strong performance in the Americas, enhanced by the successful integration of Switchback Group, which continues to trade ahead of management expectations, and an expanded regional presence.
A second half order book which is ahead of the opening level of £55.5m. This underpins our full year revenue outlook of £95.0m.
Implementation of unified business processes providing the basis for streamlined operations and a platform for sustained growth.
This places Mpac on a prospective FY21 EV/EBITDA of 8.3x and PE of 14.8x delivering a ROE of 14.2%. The medium-term outlook to FY23 indicates revenue CAGR at a healthy 8.6% and EBITDA CAGR of 14.4% placing Mpac on an attractive +3 year forward EV/EBITDA of 6.9x.
All of this leads us to conclude a fair value for Mpac shares of 600p.
https://www.equitydevelopment.co.uk/research/accelerated-momentum
Maybe a little nervousness ahead of update this week but a very well managed business in an expanding sector. Happy to lock away more at what looks a bargain basement price.
I agree that it's been very quiet but H1 ends on 30th June and last year the Trading update was released on 8th July so we should hear more soon. This is one of the smaller holdings in my portfolio and I would like to see greater engagement with shareholders/brokers/the media if there is a good story to tell.
It had a long upwards ride on the back of tips from a couple of well respected commentators and encouraging results. Recently there has been almost nothing and the price has fallen a little over 20% from its high. A company with a £100M m/cap can easily fall like that from just a lack of interest. Most trades seem very much PI's, possibly getting bored and then worried respectively - it doesn't take a lot for the very small companies to get knocked downwards.
Of course the worry is there is bad news is out there that insiders have, but which that has not trickled down to the PI's. But the lack of large sales suggests not.
At this stage I continue to hold - and if the rate of the drop eases may buy more. The reason I bought was because the strategy looked good, the business had been transformed and the company was now in one of the more profitable areas of the market. At the time I bought I felt there could be 3 to 5 years of outperformance on offer.
Simon Thompson of Investors Chronicle has produced another out of hours article updating three of his recommendations, including MPAC.
The article gives broker targets from Equity Development and Panmure Gordon of 600 and 650 respectively (although the ED target is a typo).
ST raises his target to 600 from 550. The primary basis for this appears to be a narrowing of the PE discount compared to the engineering sector.
He quotes a forward PE of 14 for MPAC and an engineering sector PE of 20. His 600 target is based on a 20% discount to the sector.
Panmure have EPS of 36.1p.
Personally I think that the target given is a little weak and unambitious. Why would a company growing at the rate of MPAC have a discount to the engineering sector? Surely a premium is more appropriate? I suppose that the target that has been set reflects the current deep discount and some narrowing of this whilst also giving room for upgrades.
Using Panmure's EPS and a sector average PE would provide a target of 720p and that's before any cash adjustment!
There is some scepticism that the best engineering companies could consistently expand the top line at 10%+ organically, whilst delivering 10%+ EBIT margins over the economic cycle. This rarely happens, but due to astute foresight, attention to detail & almost flawless execution, we think {{linkedin_mention(urn:li:organization:75780|Mpac Group plc)}} has every chance of breaking the mould.
Helped not only by its 100% exposure to the expanding healthcare, food/beverage and pharmaceuticals industries, but also the secular tailwinds of Ecommence, Industry 4.0, ageing populations, premiumisation, reshoring, biodegradable/recyclable materials and consumer convenience. Elsewhere there are other exciting prospects. Not least in craft beers (re post £10m Switchback acquisition in Sept’20), alongside designing state-of-the-art packaging equipment to manufacture Covid tests and/or vaccine vials, which could add further juice.
Therefore irrespective of the recent price appreciation – we believe there’s still plenty to go for. Lifting our valuation from 445p to 600p/share, yet equally acknowledging that if Mpac can achieve it’s “10+10” target, then the stock would rightly deserve at least a market multiple, driving it to possibly >£10 by 2023.
https://www.equitydevelopment.co.uk/research/strategic-progress-drives-valuation-to-600p/share
Mpac Group plc, a global leader in 'Make, Pack, Monitor and Service' high speed packaging and automation solutions, will be conducting a live presentation covering their Full Year Results for the year ended 31st December 2020.
The event will take place at 11am, on Wednesday 17th March 2021.
The online presentation is open to all existing and potential shareholders and registration is free.
Questions can be submitted during the presentation and will be addressed at the end.
https://zoom.us/webinar/register/4216140778567/WN_fpJBehgxTP2thGAmVSpZow
Today this share was recommended as a strong hold in the new release of the respected publication Small Company Share Watch!
all my portfolio was down today so I had a cheeky MPAC top up
Yes MPAC is an excellent company yet overlooked here, and there's plenty more to come for this in coming months.
https://www.investorschronicle.co.uk/ideas/2021/01/11/three-high-growth-small-cap-plays/
550p target price, GLA
RNS
RNS
In this evening's Downing Street press conference, Professor Johnathon Van Tam has urged patience with regards to the roll out of the Astra Seneca/Oxford vaccine.
It appears that there is a major blockage that relates to "a global lack of fill/finish capacity" to distribute the vaccine.
If only there was a British company that specialised in producing packaging machinery and already had experience of working with the pharmaceutical companies.
Such a company might just do very well!