Roundtable Discussion; The Future of Mineral Sands. Watch the video 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.
as expected, sell off cont
is this worth much more than 5* EBITDA?
tp c1.2p
Good news - a new contract win for an annual £200k-£250k for a "large housing repairs & maintenance organisation responsible for over 40 social housing clients throughout the United Kingdom."
Importantly, it was won by cross-selling to one of the newly acquired Fidelis' clients. Key point:
"The broader service offerings we now provide is attractive to many customers and we are hopeful this new contract win is merely the beginning of the Company capitalising on this aspect of its potential."
Https://uk.advfn.com/stock-market/london/react-REAT/share-news/React-Group-PLC-Contract-win/86428722
multiples(eg EV/run rate EBIT or EBITDA) look a tad racy imv
Thanks for your insta-analysis Rivaldo, looks on the money to me. This looks to be a well run business with organic growth of c. 20%, and being a small company growing EPS growth rates should continue well above the sales rate. It is also a business well suited to achieving critical mass by further acquisition; management have just demonstrated they are capable of that.
A profitable company, growing earnings at over 20% and a PE already down to 12 for the period to Sept 21 and a balance sheet that should easily support its ambitions. Looks cheap to me, I would expect the historic PE to be more like 20 but we live in strange times.
The 13% fall today looks like a fairly brain dead response to the expected EBITDA falling below forecast by a similar amount. The facts that the expected EBITDA is a remarkable achievement on last year and the positive current trading has been completely left out of the equation.
Have a feeling current SP is now factored in for worst case scenario If EBITDA figures come in at lower end £725k then its approx a 15% fall in expected EBITDA of £850k. At the SP Highs of 3.5, 15% fall would equate to 2.9 and SP at recent 2.3 would still equate to 1.95 approx current price. Just bought another 100k, believe figures will be mid range and number of contracts to increase by end of Q4. GLA
strong market reaction. Overdone?
Allenby have their update out. They calculate 0.12p EPS for the year just ended, so at 1.95p that's a historic P/E of 16.3.
There's no forecast for the current year yet - I assume this will be released when the prelims are out.
As I said, I'd hope for say 0.15p-0.17p EPS for this year including the full year for Fidelis and for the recovery post-Covid to gain momentum (including the various contract wins announced recently kicking in).
That would be a current year P/E of only around 12. And less when you strip out the £0.6m cash pile (against a mere £9.85m m/cap):
Http://www.allenbycapital.com/research.html
The Board expects EBITDA (before exceptional items relating to the acquisition of Fidelis and some restructuring costs) for the year ended 30 September 2021 to be in the range of £725,000 - £775,000* (FY 2021 market forecast: £850,000)
The trading update is out. EBITDA is to be between £725k-£775k. This is, although representing almost 200% year on year growth, and 50% organic growth, nevertheless below expectations of £850k, due to the slow recovery in reactive work etc post-lockdown.
The current year however has "had a positive start" with a "growing pipeline of opportunities".
A full year of Fidelis' profits might bring a forecast this year for say 0.15p-0.17p EPS, which with £0.6m net cash would leave REAT looking decent value at the current 2.25p.
But of course there's likely to be an initial MM markdown, so REAT are likely to be even cheaper than that.
Kudos to REAT for their presentation - including the forecasts makes it easy to analyse.
Management have done a terrific turnaround job here, and although Covid has led to a small bump in the acceleration of the company's growth, REAT still have very high recurring income - increased by the Fidelis acquisition - and have still brought about impressive organic growth.
Michael Joyce's wife has sold a total of 2,150,000 Ordinary Shares at an average price of 3.48 pence per share. The sale of shares was undertaken to meet some financial commitments and Michael Joyce and his wife have no intention at the current time to sell any further shares in REACT.
Nice £230k contract win over the next 6 months for a major Tier-1 customer announced today. Hopefully this will lead to more longer-term work for these particular services to this client:
Https://uk.advfn.com/stock-market/london/react-REAT/share-news/React-Group-PLC-Contract-win/86303973
hopefully the beginning of a move to North of 3p again.
Good to see (1) a new £550,000 contract win for Fidelis, and (2) "a number of smaller to medium sized contracts" also being won by the core group in the "last few weeks".
Plus "a steadily growing pipeline of opportunities" too:
https://uk.advfn.com/stock-market/london/react-REAT/share-news/React-Group-PLC-Contract-wins/86198484
2 m shares sold yesterday. Anybody any ideas why ?
Another 2m buy yesterday. Hmm!
Lots of info on twitter
https://twitter.com/react_sc/status/1422832189805367298?s=19
Good to see a 3% move up this morning on decent early volumes. Hopefully back to 3.5p or so soon if the seller has now finished.
Well someone believes in our company with a share purchase totalling 1.5m yesterday.
Hopefully selling finished and price has stabilised / ready for a push up. It's been a big drop from c3.6p.
Good to see the share price rising yesterday and today.
REAT are now on an annual run-rate of 0.17p EPS including a full year of Fidelis. With around £0.8m net cash in the bank against a £12.5m m/cap at 2.53p, REAT are now on an ex-cash P/E of only around 13.7. Pretty cheap imo considering the growth rate being achieved and the potential.
Needs some info on contracts etc to stop the drop,I really thought we would start to level off now. It just seems constant at the moment,fingers crossed for a turn around soon!
Looks like there maybe a change of sentiment after the last many days of dropping, covid rising again, maybe the reason.
Rentokil swooping in with a buy out sounds a good outcome for all; SD can then move on to his next project
Today's Investor Meet presentation was extremely impressive as ever imo.
Interesting commentary on the potential going forward. The Group (including Fidelis) are on an anuual run-rate now of £10m-£11m turnover, and this could double in the next 3 years - but it could also be three or four times bigger with M&A, which will always be earnings-accretive.
Other notes:
- REAT have a large and defensible moat as they are the only company of size which (a) provide a one-stop shop of such specialised services and (b) operate throughout the UK with such fast response times
- there are around 150 customers, of which 25 are large, key accounts. REAT are actively going after these to consolidate their supply chains, in the manner of the recent £2m per annum contract win of "one of the world's leading facility management companies"
- interesting to hear SD note that he much admires Marlowe (MRL), and Mark Braund also referenced them later
- the likes of ISS and Rentokil do NOT do this work, so subcontract to REAT if they have to do it
- all the institutional shareholders are supportive, and in particular the emphasis is on capital growth with no need for dividends. I heartily approve!
- at some point REAT themselves may become a target. This was noted by MB as a possible exit route for shareholders, and again this seems perfectly likely to me.
Incidentally, the poster earlier who claimed that REAT are somehow "covid dependent" evidently missed just what a small proportion of income arose from this source in the prior reporting period! And indeed has entirely missed where REAT's income - which is largely recurring - emanates from. Hard to credit.....
Yes and on reflection I decided it was time to move on fully. I am sure the company will still be busy and has the chance to buy other companies with paper but the price is no longer a penny and the times when the phones were ringing off the hook are gone for now I think. So good luck holders