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Video interview with the legendary Gervais on Boxing Day - great to see him highlighting MWE as one of Miton's "top holdings" (from just over 4 minutes in):
Https://www.youtube.com/watch?v=p-KerGV_SdQ&t=34s
https://www.valuethemarkets.com/2020/12/30/5g-a-key-investment-theme-for-2021/
“I already own shares in MTI Wireless Edge (LSE:MWE), an Israeli company which has been trading since 1972. I picked it as a top share in my other job as a writer for Motley Fool and I’m doing so again here.”
More success this morning for MWE's partner Nokia, with a 7-year deal to supply Luxembourg with 5G coverage using its Airscale portfolio - deployment commencing next year:
Https://www.investegate.co.uk/nokia-corporation/gnw/nokia-wins-proximus-luxembourg-5g-deal-to-digitize-country/20201215090000H5772/
wait for cheaper still?
high 60p looks like blow off top...and MWE has been one volatile ride
Don't you hate profit takers
Good to see MWE's partner Nokia leading the way not only in 5G , but also forward with research into 6G:
Https://www.investegate.co.uk/nokia-corporation/gnw/nokia-to-lead-the-eu--8217-s-6g-project-hexa-x/20201207071818H4310/
" Nokia to lead the EU’s 6G project Hexa-X
Nokia is the project leader for Hexa-X, the European Commission’s 6G flagship initiative for research into the next generation of wireless networks
The Hexa-X vision is to connect human, physical and digital worlds with a fabric of 6G technology enablers
Hexa-X is the first official research initiative across the industry ecosystem to accelerate and foster 6G research and drive European leadership in the 6G era
07 December 2020
etc"
Does make you wonder what all those sells were about a few weeks back. Up over 50% now
https://www.fool.co.uk/investing/2020/12/01/top-british-stocks-for-december-2020/
That's good company for MWE to be keeping considering all the other tipped companies are absolutely huge! Let's hope MWE's m/cap is £500m one day, which appears to be about the lowest m/cap of all the rest....
uk-tradingview.com
They give the shares a buy rating, also TCM buy rating
Exciting share. And however good the 5G side is, or the supply business, it's the water side that really floats my boat - though they wouldn't allow such a shocking waste...
Today I took photos of trees that still haven't lost their autumn leaves, and a tree already in spring blossom, here in the Midlands. What happened to winter???
The water problem is only going to get worse with climate change and Mottech's solutions will be needed in many countries. And as ST said: "It has shown to produce a 30 per cent increase in crop yields while reducing costs from efficient use of water, fertiliser, energy and labour. Robust demand for Mottech’s irrigation systems is MTI’s main profit driver, the segment producing a 30 per cent operating profit surge in the year to date to account for half of MTI’s total profit."
30% increase of output for reduced input of not only water but also fertiliser, energy and labour is quite some recommendation.
Glad I resisted the temptation to sell out today. Every time ST writes something about a stock it seems to add 5 or 6%. Still not enough to make this worth swing trading because of the spread. Although SUR is even worse on spread. Wonder which will get to 70p first.
continued:
"New contracts won include a renewal service agreement (potential total award value of US$2.3m) with one of the five largest municipalities in Israel. The irrigation system manages over 1,000 acres of city landscapes for the municipality and has cut water wastage by half. The contract highlights the opportunity for MTI to target in the non-agricultural segment of the irrigation automation market such as sports grounds, landscaping, golf courses, municipal gardens and residential land. China and Australia are key markets for Mottech and a raft of contract wins in the regions explains why Mr Borovitz remains bullish.
Prospects for growth are well underpinned in agriculture, too. Mottech has more than 20 years experience in providing remote control solutions for vineyard irrigation management all over the world, including Australia, Italy, South Africa, South America and Israel. Irrigation of vineyards was previously forbidden or strictly controlled in France, but climate change has prompted the French authorities to allow vineyards in southern France to be irrigated. To tap into the opportunity, MTI developed and launched a new wireless irrigation solution, Tethys. Since launch in March, Mottech and its local partner, AQUADOC, have provided the system to four water associations in France who together provide irrigation water for thousands of vineyards. Mottech’s system already services 4,000 hectares of French vineyards, and is targeting an untapped market covering 200,000 hectares.
Operating under the MTI Summit Electronics brand, MTI’s third division represents 40 international suppliers of radio frequency/microwave components and sells these products to Israeli and Russian customers. It’s a highly profitable business, delivering 42 per cent higher operating profit to US$1.2m in the year to date, and one that has a “healthy order backlog”, says Mr Borovitz.
The other main take for me was the 33 per cent increase in net cash to US$8.2m (7.2p a share) year-on-year after the payment of a US$1.76m cash dividend of 2¢ a share in April. MTI’s high cash conversion rate, and a 20 per cent operating margin on incremental sales, are strong bull points. Rated on a modest cash-adjusted price/earnings (PE) ratio of 15 for the 2021 financial year, I maintain my 70p target price, having initiated coverage, at 40p, in my September 2020 Alpha Report. Buy."
as follows overnight:
"¦ Demand for wireless irrigation systems and 5G backhaul to drive 2021 earnings even higher.
Chief executive Moni Borovitz of Israeli-based MTI Wireless Edge (MWE:57p) was in bullish mood during our third-quarter results call. He had every reason to be, having announced a 20 per cent organic increase in operating profit to US$3m (£2.3m) in the first nine months of 2020 and reiterating full-year guidance. On this basis, house broker Allenby Capital expects a 25 per cent rise in annual pre-tax profit to US$4.3m on revenue of US$40.7m to produce earnings per share (EPS) of 2.9p and support a 25 per cent dividend hike to 2.5¢ (1.9p).
Moreover, expectations of 16 per cent EPS growth to 3.39p in 2021 are well underpinned by robust structural growth in the end markets of MTI’s technology businesses: demand for next generation 5G networks; global warming and climate change; and increased defence budget spending.
MTI sells 5G backhaul antennas to support mobile phone operators roll out their 5G networks, helping to transfer the data from mobile users to the operator’s network. The segment accounted for a tenth of MTI’s antenna division’s revenue of US$12m in 2019, and demand is set to surge in 2021, and for many years to come as operators upgrade their cellular network infrastructure to 5G. MTI has sales arrangements with four of the seven manufacturers of mobile infrastructure networks so is well placed to benefit. It’s doing just that, having recently won a US$0.5m landmark single order contract for a 5G dual band backhaul solution. Earlier this month, MTI also won a US$0.65m initial contract for military antennas with a new European customer which “has potential to become a larger customer for MTI”, says Mr Borovitz. The military segment provides a reliable income stream and enables MTI to reapply the technology developed in commercial markets.
MTI is also a smart play on climate change. World Bank estimates that 25-30 per cent of freshwater is wasted, and an eye-watering 2.8 billion people across 48 countries are expected to face water shortages by 2025. Agriculture, including the wine industry, holds the key as it is responsible for 70 per cent of all freshwater usage. MTI’s Mottech wireless water control and management system addresses water scarcity issues by providing high-end remote control solutions for water and irrigation applications based on Motorola's IRRInet state-of-the-art communication technologies. It has shown to produce a 30 per cent increase in crop yields while reducing costs from efficient use of water, fertiliser, energy and labour. Robust demand for Mottech’s irrigation systems is MTI’s main profit driver, the segment producing a 30 per cent operating profit surge in the year to date to account for half of MTI’s total profit."
This one suggests the share price could double to 107p....
Not the most in-depth analysis I've ever seen (!), but good to see anyway, particularly from a charting point of view:
Https://www.ii.co.uk/analysis-commentary/mti-wireless-edge-ltd-heres-how-share-price-can-double-ii514199
Up another 6% today.
Good to see MWE attracting more attention now. I note the buying price has increased to around 53.4p this morning.
The report can be downloaded here for free, but you probably have to sign up first as I did:
Https://aiminvestor.co.uk/wp-content/uploads/2020/10/MTI-Wireless-November-2020.pdf
"Summary
•MTI Wireless Edge (MWE) is exceedingly well positioned to benefit from the global 5G rollout and it is also playing a key role in helping the agricultural sector manage issues around water scarcity.
• September’s 5G contract win represent a “significant” step forward in MTI’s 5G backhual anntena business.
• MTI have an increasing strategic focus on the fast growing Chinese smart farming market.
• A proven track record of delivering revenue and profit growth underpins MTI’s foothold in high growth markets."
Brief written notes from yesterday's presentation:
- $8.4m cash and $6.5m freehold property asset backing
- 5G : some 5G antenna deals are pending
- working with 4 of the top 7 telco suppliers/manufacturers (i.e Nokia and not Huawei)
- Water : won several new contracts in Australia with effect from last month
- the new vineyard product is beating expectations
- very happy with progress in China
- Consulting : the "jewel in the crown" this year
- won new contracts for the next 12-18 months, especially as representative of TCom Aerostat systems
- the substantial COVID cost savings achieved should continue for the medium term
- there will be a new water division product launch soon to bring increased growth
Everything sounds really positive, and all three divisions appear to be well set for continued growth this and next year, particularly given the costs savings due to the pandemic.
First off I thought the market would react disappointingly to 2% revenue growth, but of course in these circumstances to bring home 20% increase in profit is astonishing. Coupled to the fact that are at an early stage with 5g It looks as good a place to be as any.
MWE just gave an excellent Q3 presentation to all investors - I assume there will soon be a recording of it available.
Very promising across all divisions. I'll write up my notes later:
htTps://www.investormeetcompany.com/mti-wireless-edge-ltd/register-investor
Allenby Capital have this morning increased their price target to 63p (from 46p).
They've retained their prior forecasts for $4.27m adjusted profit, with revenue down and EBITDA up given today's update. The new 2.9p EPS for this year is simply a rounding difference away from the prior 3p EPS, with 3.39p EPS and 3.79p EPS going forward:
Http://www.allenbycapital.com/research_1102_2186309562.pdf
Here's Allenby's summary:
"Profit growth on track
Today’s update demonstrates 20% operating profit growth at the technology group specialising in comprehensive radio frequency communication solutions across multiple sectors for the first nine months -a function of revenue growth (+2%) coupled with cost savings and operating leverage. A good performance given the global backdrop. EBIT margin increased 150bps to 10.1% and this higher margin means MTI remains on track to meet our FY20 profit forecasts albeit on a lower revenue base and we reduce revenue forecasts by 6%. We anticipate limited cost inflation in FY21 and hence profit forecasts remain unchanged but we trim revenue. We also introduce FY22 forecasts.
MTI has a diversified business and each division can point to structural growth drivers. Despitea good share price performance this year (+28%), the current price fails to reflect MTI’s track record and growth potential, balance sheet strength and yield. We set a new fair value (63pfrom 46p), equivalent to an FY21 EV/EBITDA of 11.4xfalling to 10.1x in FY22."
Agreed a strong set of results and a lot of confidence across all the divisions. I keep thinking 5g will be the cash cow but the other aspects add a good balance and diversity to the business.
- Q3 basic EPS is up 12% on last year to 2.65c, and operating profit is up 20%
- the adjusted EPS will be even better after adjusting for amortisation
- positive outlook, with MWE trading in line with expectations despite COVID-19
- the cash pile is up to $8.2m
- all divisions are trading well, with 5G "gathering pace"
- 5G, water management, and design solutions for tech companies and the military are all in booming areas of the economy
Https://uk.advfn.com/stock-market/london/mti-wireless-edge-MWE/share-news/MTI-Wireless-Edge-Limited-Results-for-the-nine-mon/83687081
If MWE make 3p EPS this year they'll soon be on a historic P/E at 52.5p of 17.5. This will fall next year to only 15.5 based on Allenby's 3.39p EPS forecast.
But MWE have a $7.6m cash pile which equates to 6.6p per share. Plus they also have $5.5m of freehold property as further tangible asset security, i.e another 4.8p per share.
That's 11.4p per share of tangible assets. Even just deducting the cash pile, that leaves around 46p of EV playing 3.39p EPS - an ex-cash P/E of 13.6 for a company concentrated on fast-growth areas like 5G and water control/preservation.
Seems to have done the trick R. Very good post by Martin. I had been wondering about the water project as to be perfectly honest although I was aware about that, there has not been a great deal of news on that aspect of the company and makes it considerably more interesting. I suppose people are realising todays the last chance to buy before results published. A little bit nervous on that one to see if they confirm the current rating. Whatever the results I am a lot more confident about the long term here. Gl all invested
Here's a very good summary of MWE by hastings/ the Private Punter written only a couple of weeks ago, which hasn't been posted here before and is well worth a read:
Https://martinflitton1.wixsite.com/privatepunter/post/timber-mwe-looks-well-placed-29-10-20