Newsflash for the Snoozers Part 12

Monday, 18th April 2016 09:08 - by Moosh

Empyrean Energy (EME)

Last week saw a major shareholder of EME – Mr James Kight – top up his already massive holding with a further 2.25 million shares, increasing his interest from 7% to 8%, or 17,750,000 shares. He’s fast on the heels of the holding of the CEO, Mr Tom Kelly, who holds just short of 10% of EME.

Given that the notification of this didn’t happen till later in the afternoon in the earlier part of last week, it probably got missed by many investors but even so, the price has already started to respond, if slightly, towards the end of last week.

I would think Mr Kight has loaded up further with EME in anticipation of an aforementioned payout (see Newsflash for the Snoozers – Part 11) of a special dividend once US taxes have been paid. EME remains essentially debt-free now so I feel the opportunity is ripening nicely by the day and should be actively exploited by investors while the company appears financially safe in the short-medium term, which can’t be said for many AIM oil and gas companies. I feel this to be a HOLD for up to 14 weeks.

Orosur Mining (OMI)

OMI provided a solid enough third quarter update last week, which showed further reductions in all-in sustaining costs and operating cash costs for gold production. The market seemed to take the news positively and the company market capitalisation still remains at a large discount at £9.27m (market close 15 April 2016) compared to its net asset value of ~£23.6m (Q3 end). I see OMI as a HOLD for up to 13 weeks.

Servision (SEV)

Following a placing at the end of February 2016, SEV then provided a market update on its UK business front. I found this interesting because it begins to show a good start to the recurring revenue model which SEV hinted at in 2015 and also includes a wide variety of partners – many of which can be seen in a recent company presentation. It would also be interesting to see how the non-UK business is faring and I suspect we will receive an update on those operations soon enough. I feel this to be a HOLD for up to 17 weeks, which should include further trading updates and the full year results, usually given towards the end of June.

Software Radio Technology (SRT)

SRT issued the market with a bullish trading update last week which mentioned that revenue for the latest full financial year will be 24% up on the previous year, which is ahead of market expectations. With a cash balance of £1.8m at the end of the financial year and a forward order book of £70m, with potentially more long term contracts to come from a much larger (and growing!) £200m+ pipeline, it is obvious to see why the market has been snapping up SRT since it released news back  at the start of March 2016 of a ~$100m supply agreement to last over 3 years. SRT has been setting itself up over the last few years to be on the cusp of beginning to turn the pipeline into a real long term revenue stream with growth and it seems the company is starting to deliver what it has long believed that it would do. The final results are due at the start of June, followed by an AGM and an Investor open day at the start of July. Between now and July there also holds the possibility of a further secured agreement so I feel SRT to be a HOLD for up to 9 weeks.

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