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Article on 22nd June - Fair value potential 250p
Investors Chronicle has a series on Cyber Security. The 2nd part was out on 7th June and states that they will cover smaller UK specialist Cyber security firms in the 3rd part. I'm expecting SWG to get at least a mention....
..is coming. I anticipate a vertical rise to over £2 when the market realises just what is in store. Glad I averaged down (for a change!)
Haven't seen any news - though this month's Techinvest is issued this Wednesday.
Good to see relatively small buying causing a 5p jump. Perhaps not much stock around.
let this holding survive the purge because I believe it is so undervalud but my gut tells me it'll drift back yet again and if/when it makes another good contract RNS same will recur.
I've added some more <135p. I can see it getting tipped in the weekend papers
Here's a link to Berenberg's reiteration of their Buy and 380p target:
Https://investing.thisismoney.co.uk/broker-views/SWG
It's not often you see a growing cybersecurity company on almost a single-digit P/E (OT : although SYS are also similarly under-rated at present!).
A poster elsewhere has noted that Berenberg have a 380p price target:
"Berenberg see momentum building, 380p price target. 'potential significant upside'"
Cenkos have also issued a new note this morning - they say fair value is at 200p+.
They've raised this year's forecast to 13.7p EPS, and see a £6.8m cash pile at the end of this year. They conclude:
"Fair value lies at 200p+. Excellent delivery and the prospect of returning project work bodes well for FY23E and beyond and is not being recognised in the share price. A rating of sub-5x EV/adj EBITDA in FY23E is anomalous and fair value for such a business with a cash positive balance sheet in our view lies over 200p. Buy"
Cracking H2 and the recent £21m contract win (over 3-5 years) doesn't seem to have even got priced in to today's share price.!!
An absolute bargain at this level and hopefully others will see this, when todays results get wider coverage..
I'm going to drop an email to the PR company to pass onto the Directors - I've been critical in the last year and have dropped them a few emails; but credit where credits due; they've pulled off a blinding H2 and monster contract win. Hopefully more contracts to come ....
I wouldn't be surprised if Simon Thompson picks this for one of his Alpha articles. Lowly rated, cash rich, growth companies are his thing
I think this update is extraordinarily good, especially when taking in conjunction with the recent multi-year contract win. Valued as a junk stock when it's actually a growing, cash rich, tech company
https://twitter.com/F15JCM/status/1519226694099472384
Looking very solid
Progressive Equity Research have increased their forecasts to 11.9p EPS for last year, and to 14.1p EPS for this year (from 13.8p).
They summarise:
"The CEO’s comments strike a confident and enthusiastic tone, confirming
that progress has been made with both new and existing clients, and
pointing to the company’s growth trajectory. Shearwater looks to be
delivering and moving to a revenue growth path, and more positive news
on contracts or guidance could well see the market valuation metrics move
to reflect this."
Https://progressive-research.com/company/shearwater-group-plc/
The trading update is out - revenues and EBITDA well ahead of expectations......
Https://uk.advfn.com/stock-market/london/shearwater-SWG/share-news/Shearwater-Group-PLC-Year-End-Trading-Update/87918587
EBITDA will be a MINIMUM of £4.2m, compared to £3.8m forecast by Cenkos, which I'm guessing will give rise to around 12.5p historic EPS.
SWG would appear to be in rude health, winning new customers, having the security of a £5.6m cash pile, and a very bullish outlook:
"We have returned to a revenue growth trajectory, underpinned by a strong financial position, and we remain excited for what the future holds."
Loads of upside here from a current year P/E in single digits based on 13.8p forecast EPS to March'23.
Year end update last year was 22nd April so hopefully soon. Meeting expectations depends on delivering a significant H2 weighting so fingers crossed
Lots of buying activity today. Maybe news has leaked and there will be a great update arriving shortly.
With all the resent contract wins it can only be good, can’t it ?
Well I’m an investor and I’m looking to make a good return on my money. A takeover works for me too and I agree with you that it’s a realistic possibility. I doubt that they would accept anything below £3 though.
Less than 4 weeks ago Cenkos reiterated their £2,00 plus valuation and that was without the knowledge of this game changing contract win. I’m very much looking forward to the company update before the end of this month.
Pinocchio you seem very bitter and twisted. I’m guessing that you bought a load of shares at the placing price of £2,40. You should start to cheer up because it’s looking very much like we will sail past the placing price before to long.
SL
Nice to see this rising so well.I expect it is worth in the region of 300p,so plenty to go.
"and down she goes' ? Sheer genius P. See if the FT will have you
Pinochio have you ever said anything rational and balanced? Have you ever attended a meeting. Do you know what each individual company does within the group! It seems to me and others you are just commenting on sp movements. I have spoken with the directors . I can assure you they know a lot more than anyone about the business on any billboard including me and you. Good luck and try and find some other board to post on in a company you are invested in and know something about
...like many others here, I have averaged down since the original purchase and things look set to move nicely at last.
Pinocchio. Your nose is getting longer by the minute. Bad luck if you are not in it. Still time though. It has been a tough couple of years for investors. Have the good grace to allow us to celebrate. You don't get a 21 million potential contract by being idiots.The market has got this company wrong . Fact. The shares are vey illiquid, only 24 million in circulation. The directors have a huge amount of skin in the game, because they do actually know what they are doing. This is a long term game and the market potential of cybersecurity is massive. there is plenty of room for specialist companies like this to grow.