News for the Snoozers - Part 5

Monday, 2nd February 2015 10:14 - by Moosh

Beximco Pharma (TIDM: BXP)

Over the last week BXP announced to the market the approval of a new loan to partially fund its expansion in Dhaka, which would be very welcome if growth is to continue especially as BXP gain access to new territories around the world.¹

Sinclair IS Pharma (TIDM: SPH)

A recent trading statement from SPH informed the market of H1 revenues being 31% higher than the previous financial year and the company also stated that H2 sales usually tend to be greater than H1 and expect this trend to continue in the current year.² The company is also in an offer period with the potential for being taken over so how could we possibly gauge a takeover price given what we know?³ If you recall from my Price Tag entry, I noticed that pharmaceutical companies tend to follow a model where the takeover price comes in at about three times the annual revenue.⁴ The previous full financial year had total revenue of £63.56m. Now let's assume that the current year has a growth in revenue of 30% in line with the recent trading update - we would expect total revenue for the year to be around ~£82.628m. Therefore I would be looking for a reasonable takeover price of (3 x £82.628m) split over 497.41m shares, which comes to ~49.83p. However, if the growth in H2 is greater than 30% over the previous year, then we could be looking at more than this! With the current price at 37.75p (market close 30 January 2015), then I believe it's worth a hold.⁵

UK Oil and Gas Investments (TIDM: UKOG)

Following the success at the HorseHill-1 well and with the later observation of a likely increase in reserves at the Portland site, the company this week appointed a CEO and also acquired the services of NUTECH Energy Alliance Ltd, which specialises in reservoir analysis - this alliance may prove highly valuable since NUTECH have already done a lot of work relating to wells in the Weald and Wessex Basins in which UKOG has an interest in.^6-9

References

1. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=BXP&ArticleCode=afjds1wx&ArticleHeadline=Enters_into_new_Loan_Agreement_to_fund_expansion
2. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=SPH&ArticleCode=qzfqr4qq&ArticleHeadline=Trading_Statement
3. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=SPH&ArticleCode=lqxd05a0&ArticleHeadline=Statement_re_AGM_and_commencement_of_offer_period
4. http://www.lse.co.uk/blogs/member/moosh-blog/38hd9p/
5. http://uk.advfn.com/p.php?pid=chartscreenshotshow&u=770ZGbG3142+Ft5luzkuoIeAufHiez1Q&symbol=L%5ESPH
6. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=UKOG&ArticleCode=xs9si15o&ArticleHeadline=Horse_Hill1_Provisional_Results_at_TD
7. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=UKOG&ArticleCode=x4k9iu4k&ArticleHeadline=Horse_Hill1_Oil_Discovery_Update
8. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=UKOG&ArticleCode=pjag28ai&ArticleHeadline=New_CEO_Appointment
9. http://www.lse.co.uk/share-regulatory-news.asp?shareprice=UKOG&ArticleCode=xt25ad7p&ArticleHeadline=UKOG_signs_alliance_with_reservoir_specialist