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I agree. I see this as a (relatively) safe pick overall. I have confidence in management and the layout of the business. I see this share continuing on its recent (slight) recovery over the coming weeks because I feel orders will materialise. What do others think?
Depends how much you believe the company can return to previous trading margins. Personally I am happy to take the continuing rising revenue, albeit not what was anticipated, and ride out the storm as I think management will bounce back. The type of large contract work they carry out will lag the general market optimism as deals get closed. We know that there were record levels of bidding being done within the last 12 months so I think deals will start to trickle through. As such I have topped up recently, accepting the higher level of risk. Obviously waiting for better news will be reflected in the share price as always.
From Feb 11th RNS: "Steps have already been taken to restructure the business in response to these lower revenue levels but it is now anticipated that full year PBT* will be materially below current market expectations. Tricorn will provide a further update on current trading and prospects in April 2014 following the completion of its financial year to 31 March 2014". probs best to wait until the April update or final results to see what direction this will take now. a good company but product obviously losing demand for now.
The fundamentals of this business, after the profits warning, look OK (if there is not another warning!) so I'm dipping a toe in ahead of the next announcement.
Well i just bought in, a niche company, small divy and in a nice niche market. Unfortunately sales are down on all division except aerospace which was flat so profits below expectations, but in recent times I personally think if their still making a profit and payin a well covered dividend worth a punt. All the usual DYOR apply. Regards
With a good PE and a track record of net profits, combined with international exposure and a diverse portfolio of brands, is TCN not a solid investment for the long term? Stretching this company across three continents is a big ask at this stage, but am I wrong to think this a well measured risk with record levels of enquiries announced in 2013 and seemingly an upturn in the growth forecasts for the sectors relevant to this company in the UK, the US and China?
Tricorn Group: Westhouse Securities lowers target price from 50p to 35p and downgrades from buy to add.
Lol
interesting!
50p price target by broker issued today.
Yes...regardless of how much revenue I think, if profit was lower than last year then it would be down. Looking good for possible bounce although I'm out of funds for time being.
at the moment suggests to me that this is undervalued, and has been treated way too harshly by the market for such a tiny loss. Keeping on eye on this now...
was just going to post that! Seems profit below management expectations but divi up - Flat perhaps... :/ With early spike to catch some out?
Yep...but profit down so.not sure which way its gonna go!!!
13m revenue 10m mcap.
Divi up 30%!
shocking performance yesterday! could have been 4-1!!! gotta get it sorted in defence.
Well spotted mate! My mistake. Yes trading statement says revenues 15% higher but pbt lower.
Yep...good liitle company this. Last trading statement said revenue will be 15% higher than same time last year. Positive working capital and interest coverage ratio good so able to pay debts easily too. Maybe worth a trade as results out December 3rd this week.
Online at lunchtime I could sell at least 35,000 at a premium at 36.25p, but could only buy a maximum 1,000 at the full 38p offer!
Westhouse confirm their 44p target for Tricorn & the BUY rating ........... http://www.watchlistnews.com/2013/07/02/tricorn-group-plc-given-buy-rating-at-westhouse-securities-tcn/ An upgrade perhaps after the September AGM or the early October trading statement? Also, a great interview with the CEO to his local business newspaper ........... http://www.insidermedia.com/insider/midlands/91982-tricorns-chinese-expansion-roll-welburn As commented on elsewhere, "£35m revenues at TCN's target margins & a "growth P/E" of 12 would imply a market cap of £33-36m in late 2014 (perhaps early 2015) - that's over 100p per share."
Seems a lot going for TCN. Can anyone provide a decent summary please?
Excellent new article from Penny Sleuth. 7.4p EPS going forward makes the investment proposition here very attractive for investors with a little patience. Some extracts: "Businesses need to be adaptable and as one door closed others have opened. For a while Welburn has had his eye on the major markets of China and the USA and now the group has a factory outside Shanghai and another in North Carolina. It has become established in China by following its major customers, notably Caterpillar which already has 23 factories over there. The US giant, explained Welburn, has a certain way of doing things with which Chinese suppliers were struggling to conform. Having served Caterpillar for several years in the UK, Tricorn is thoroughly familiar with Caterpillar’s modus operandi and this gave it the chance to get into the Chinese market. It has opened a modern factory, which is already being extended in anticipation of expansion. It has delivered its first products, and has had several enquiries from potential new customers. This could double Tricorn’s revenue Tricorn’s other opportunity has arisen in the United States, another market that is not only huge but is also looking rather more buoyant than Europe. Here Tricorn has been able to acquire the business and assets of Whitley Products Inc, a company that was founded in 1942 to make screw machine parts for the war effort. It subsequently expanded its product line to include tube fabrication from factories in Plymouth, Indiana, and Franklin, North Carolina but has recently become financially distressed. Tricorn has moved the whole operation down to Franklin, a ten-hour truck drive for the machinery from Plymouth and has secured the jobs of over 100 local staff. It has done so without disruption of supply to Whitley’s customers, which include the giant maker of agricultural machinery, John Deere. This looks like a great deal for Tricorn. It has paid just £1.95m for assets valued at £2.8m, and now has its hands on a business with an annual turnover of around £20m. To put that into perspective Tricorn, which has a turnover of similar magnitude, has been valued at around £8m over the last few years. Especially impressive has been Tricorn’s ability to make these strategic moves without having to raise fresh finance. It has always had a strong balance sheet, has maintained this throughout the financial crisis, and has paid a rising dividend as well." "With the benefits of these new initiatives in the USA and China, broker Westhouse thinks that Tricorn’s revenue will almost double over the next three years. By 2016 Westhouse is forecasting a pre-tax profit of £3.1m on sales of £39.4m. It foresees earnings per share of 7.4p, a dividend of 0.9p and a net cash balance of over £1m. "
Great results well ahead of forecasts - 4.02p eps against a broker forecast of 3.1p. Plus a 50% increase in the dividend, showing terrific confidence, and a bullish outlook statement. The contract loss has been well and truly overcome with the American acquisition and the Chinese expansion. Any revised forecasts will be interesting. I may be wrong, but from memory the 3.9p EPS forecast for this year pre-dated the American acquisition? If so, the strong outlook and the good start in the USA (plus similar in China) may mean that the 3.9p EPS forecast remains unchanged or even gets increased With the strong Balance Sheet and the worldwide prospects, at 31.25p TCN still looks pretty cheap imho.
A rather bullish statement.today, with an increased dividend, start of Chinese produiction etc: http://www.investegate.co.uk/tricorn-group--tcn-/rns/trading-statement/201304090700048296B/ The figures suggest an adjusted PBT of around £1.6m and EPS of 3.8p or so, with a possible dividend of 0.25p-0.3p. Not bad against a mere 22.75p share price. This compares to the forecast from Westhouse of £1.35m PBT and EPS of 3.1p... Very promising comments on the Aerospace division and of course on the new global reach of the newly expanded company. And all achieved from internal resources too, with no dilution or borrowings.