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St0wski Generally a good RNS and I fully agree with your observation. Definitely a more mainstream mass market offering. I continue to believe however it will be at least Q2 2017 before we see any appreciative rise in the SP as even a SaaS product will require 6 - 12 months of trials by prospective customers prior to any meaningful adoption. It remains a long term hold for me on the basis that I think the future still looks excellent, just requires patience. I would be delighted if the timings are earlier.
5th patent this year. But this is the key bit for me: The Directors expect that later this year, Arria NLG will launch Recount, its first software as a service ("SaaS") product offering these features and others to accountants and financial managers worldwide. The Company also expects to introduce Software Development Kit (SDK) 5.0, an automated NLG report-generating software toolkit permitting developers, without NLG training, to embed Arria NLG analytics and reporting into their software and websites.
Kidnokd, Many thanks for taking the time to respond, much appreciated. While I appreciate a lot of what you have outlined remains speculative, the non speculative elements of your post do clearly highlight the opportunity and compelling case with which NLG is positioning itself. I also think that the deals along the lines of Genpact and INOVX will ultimately prove to be the longer term bread and butter revenue for the company, however I still have an inkling that it will take time for these to deliver the hard bottom line finances that the market is ultimately looking for. The company have already stated that they do not expect to see any license revenue from the INOVX deal until 2017 at the earliest. For what it is worth, my own thoughts, and hope, is that a more visible stand alone deal, more akin to the contract previously entered into with Shell (even if of far smaller value), will be the type of contract and announcement needed to propel the share price in the short term. Obviously lots of speculation as with all shares, however I remain a committed and extremely optimistic long term investor in NLG, and once again many thanks for taking the time to respond.
Topped up again with NLG shares! They will be banked in my ISA account, looking forward to the future RNS and climbing progress of this company...
Well said! Been invested since 2012. The whole story and opportunity is mind boggling. Only frustrating thing is short sighted investors jumping off and on and off. Buy sit tight and enjoy the next few years as its been 4 years to date and this year will be break out year. 😀
CharlieR. First of all, really good post, happy to respond. You've sort of guessed some of my rationale, but happy to expand. Clearly a lot of speculation and no doubt, a linear rise without some bumps is to be expected. A share price of £1 means a market cap of £120m, so how could this be reached: 1) Completion of proof of concepts into muti year contracts. Some of these will be sizeable and multi year awards. Let's say that adds £5m per annum. 2) Genpact. This one is massive, with approx. 800 salespeople and access to the pretty much the entire fortune 1,000 list the sales potential here is substantial. Let's for argument say they get 200 sales with an average revenue of £50k. That adds £10m per annum 3) Future deals. As per the INOVX announcement yesterday, new deals are being struck all the time in multiple sectors (even a smaller non RNS deal in Spanish property) and a lot of noise is being made about healthcare through IBM Watson and financial services. Both of these sectors are huge, so a long term revenue of £15m per annum is not too ambitious. 4) Developer packs and SAAS solutions. Later this year these will be launched and qlick through revenue should come on tap. Difficult to put a number in this, though they would be doing this for less than £10m per annum I would have thought. 5) Patents. These are valuable to competitors, which make the firm a takeover target. Let's put a value of £5m on those. Ok, so add that up and medium term revenue could be £45m to £50m per annum. Put that on a earnings ratio if 50% and you get £22.5m to £25m. Now apply a p/e of say 20 (which is at the very conservative end of the scale) and you get a market cap of around £500m. The target for a £1 share price is £120m, therefore eminently achievable. A couple of other points to consider. Sharon Daniels has returned to the board after working with Diligent. That share price went up 20 fold, and in addition to Sharon a lot of core diligent investors are founders and holders here. I genuinely think this is another diligent and this will be a very valuable share. Now is the time to buy at these stupidly low levels.
Hi Kidnokd, with a holding of 40,000 shares I am a relatively small investor in Arria, however see it as a disruptive technology with many USP's that are applicable to a wide variety of industries, but as business reporting software within mainstream markets may still be a little before its time. I have invested with the long term aim of seeing the £2 - £4 SP targets you have mentioned, however I struggle to see where a year end SP of £1 will come from. A £1 SP would imply a market cap of £123m, and while I appreciate PE's of innovative technology companies can be many multiples of earnings, even with a PE of 20 or 30 in the short term this would imply earnings of £4 - £6m and for arguments sake revenue of £8m to £12m. From a 2015 revenue and operating profit of £1.5m and minus £8m respectively that would appear a long stretch in the short term. As mentioned earlier I appreciate cutting edge technology companies often attract eye watering PE's and market caps in anticipation of future delivery, Amazon being a great example with a market cap of $260bn on a loss last year of $111m, albeit with sales of nearly $90bn. I would be interested to hear if your thinking is based on announcements yet to be released that will deliver a re-rating based on future potential, or whether you foresee a dramatic change in revenue and earnings in the short term potentially as a result of the many trials that have been ongoing over the past 18 months? It goes without saying I would be absolutely delighted to see £1 by calendar year end!! Regards
£1 by year end £2 to £4 longer term target.
Mon, 21st Mar 2016 11:27 (ShareCast News) - Arria NLG announced a new partnership on Monday, exploring ways to add its technology to that of US-based 3D technology firm INOVX. The AIM-traded developer of natural language generation technology said the partnership would see its NLG platform provide real-time advanced data analysis and commentary to IMOVX's 3D asset modelling software. INOVX's software generates virtual environments to allow field assets to be monitored and managed through interaction with 3D models. The addition of Arria's NLG platform would assist the end user by communicating insights in natural language in real time. Arria's board said work was commencing on the integration, and if successfully deployed it could start receiving licence revenue during 2017. "This is a great application of Arria's core technology. With INOVX the NLG platform truly becomes the voice of the engineering expert monitoring an oil and gas refinery or similar asset. INOVX allows controllers to swoop through a complex plant asset in a true virtual representation, allowing incidents and issues to be quickly identified and acted upon," said Arria NLG chairman and chief executive Stuart Rogers. "Our NLG component tells operators what is happening beyond what they are seeing virtually, and can even provide recommendations as to what actions to take next," he added. INOVX chief executive John Bell said the company was consistently seeking compelling technologies that could further improve the operational efficiency of its customers' critical assets. "By linking INOVX's V-Suite products to Arria's NLG technology we feel we have a game changer. A true virtual Artificial Intelligence monitoring and informing controllers as to the state of both their downstream and upstream assets," he said.
They don't have a category above strong buy. They should have. DYOR.
Couldn't agree more. This will be the first of quite a few significant, imminent announcements. I'm buying as many as I can at these levels.
where will this go to i wonder
and moving
40p will be soon
boom
http://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/NLG/12745538.html
Techfan. Clearly you are looking at a different trade, as the one I can see was a sell based on yesterday's spread.
They are 40p convertible loan notes. Doesn't mean the shares are worth 40p but that is the price they can convert at. Should the price rise above 40p then they may well convert which would probably be beneficial for all concerned. Repeat though - it does not mean that the shares are worth 40p now.
40p premium!!!
Buys coming in..40p..big premium
Fund raising
Integration of natural language processing capacity and predictive analytics will push ASR solutions from a simple assistant to something closer to an efficient consultant for the user. Up-coming ecosystems around wearables and artificial intelligent will drive the ASR usability in next few years to become one of the key user interface options of next generation devices.
What's happening anything on the news? Or pips suddenly realised that's is a future Big data company with massive potential.
Wow that was a big buy. Something interesting maybe going to happen?
Yet google have it up 11.38%