Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
No ideal...there hasn't been any shock dramatic drop off but cannot believe where the SP is. Must be one of highest quality names on the AIM and it seems to just go on completely un-noticed even after stellar results. any thoughts from you? I'm just happy to own and weight...topped up a lot 2 days ago. Under 7x PE for 20% organic growth high margin name...insane.
I don't know what people's views are, but I find Paul Jourdan a distinctively unimpressive investor...he is always chucking money at really highly valued speculative stuff at share price highs and is not someone who can even come across as impressive in interviews. Even that video on Vox re Tinybuild...it just came across as like he had some money there but didn't really care all that much / know what was going on. He is an example of what is wrong with the industry in my view.
Been watching this since c.£1.20...what a performance. Many times I've been close to buying in but held off...not even sure why...certainly not because I had any special foresight.
Ultimately this now sits at probably 3x earnings...which in most cases would see me load up. However...there are just too many red flags. The people involved is something that I could get over...CEO is bold and owns a lot, something I see as a positive; but his boldness lacks a measured CFO - that was all to clear in latest update. The cash burn will continue this year...which again I could live with - and even encourage - if it was being spent on hit games and a potential investor could see that being reflected in game reviews and satisfaction levels. But there in lies the risk I just can't get over...they seem to not be hitting the spot with their new games, and they have invested heavily. Games aren't like a factory being built and not giving the expected return either...they knock the Company's reputation which is so critical here. Word of mouth in gaming world spreads like fire and the fact they now have had a few games not hit the spot really worries me.
It's for that reason I'll be staying away but will be watching everyday with intrigue to see how this plays out. Btw - my knowledge is as basic as it comes here...just my take above. For those that can do the required digging here...there is clearly a potential multi-bagger on offer. Best of luck!!!!
Hey shearclass - we’ve spoken before over at tinybuild…always like your input.
I must admit, this has been a painful watch for me as lost 20%…but fundamentally do think there is value here. It’s a cash hungry model but there collection rates are also growing a lot and are very substantial. They had a difficult year in credit hire with the court delays and the insurance contract going wrong which was not their fault. I’m looking beyond credit hire here….the housing disrepair segment is highly attractive, has much quicker pay back and returns on capital of +50%. It’s a hated stock at the moment but I think the VW case will come good and you gave that added upside as well.
Always just about assessing risk and reward but I think there is good upside here. Agree though that VW must be used to get rid of that horrendous expensive funding got last year - that was silly.
Not really insightful at all….basically just saying what happened to ince is a sector wide issue and that broad brush these are bad businesses.
The company generates high returns on capital and margins alongside revenue growth as a result of being a specialist niche business. It has additional lion fish sale upside.
The business generates 15mm in ebitda and a good amount of FCF. It’s undervalued and once the ex ceo is out of the picture I’m sure will do fine.
Capital cycle is heavily relevant in this sector right now…its despised and at a trough. Bodes well for those who can look to the future and understand tha cycle.
good to see us rebound today after that absolutely hissy fit yesterday which was simply ridiculous.
i don't understand people's complaints...does anyone really expect them to be posting +20% organic growth rates after the numbers last year in an ad downturn...get a grip and some realistic expectations formed.
they are doing fine and trading on high teen FCF yields now, with plenty of scope for upside.
unfortunately the current run rate of growth is a very very long way off justifying a high 20's earning multiple (assuming a much higher multiple than that if one uses current trajectory of profits)...this is the problem for the SP now, not Candy or Bonnier. If investors see value...no matter what the shareholder structure people will chase it...however, growth vs. value here has been grounded to a halt.
Hi All - someone needs to start of the conversation here. IMO a massively undervalued long-term hold now. Are into single digit P/E now with massive cash generation. Could the next year be harder...possibly. But this is one of the very high quality UK names which is priced way below where it should be. Looks like BlackRock offloaded here hence the dramatic drop over last few days, great entry point.
Oh god Monty will you drop it mate....go and do some valuation lessons for investing - Free Cash Flow - it is the sole driver of any net present value calculation....I'm not making it up for you pal...it is an axiomatic law! Please go away and learn this and stop repeating the same garbage about IFRS / GAAP earnings numbers. Jesus...
As you say Rivaldo...truly excellent update given the performance of other names in this sector e.g. SWG. I was actually quite nervous for this update...was expecting a potential horror story. Exceptionally managed business this and the value on offer is brilliant.
ha acoldfloor....literally I just found this today and also looking for a story from an experienced OG...how the hell did we get down here when fundamentally we look pretty OK?? would much appreciate a synopsis...
I'm not entirely sure why so many people here are obsessed with GAAP profit numbers...it is honestly a terrible way to invest to be looking at those numbers. Free cash flow is the sole valuation determinant of a company...people need to get this into their heads and for it to be firmly front and centre. No other metric matters I'm afraid...can be good to pick up stuff on cheap earnings multiples but earnings can be completely manipulated and they in many cases are useless.
CentralNic excels on the FCF front...it is a scandal where it is trading right now...only way I'm looking at it is that its such a steal that I'm viewing it as a gift to pick up as much as I can at this level.
Business could potentially do $1bn in revenues this year...will have to wait and see but it's not out of the realms of possibility. Also on margins...this is something that is reasonable currently but should ramp up significantly. The business really benefits from operational leverage so volume growth should exponentially improve them.
I don't know what the catalyst is here to get these to a fair price...but I can safely say as someone who every few months screens the entire AIM and FTSE markets that I have yet to come across anything so undervalued.
as usual shearclass...your comments always very useful. and you are spot on...this is a revenue growth play and any faultering on that front with failure to release new games which build decent franchises...you have a failed growth story because even 'average' top line growth will not offset all the other headwinds.
this is why its hard to invest...very hard to forecast the top line prospects because very difficult to gauge the success of new games etc.
well....now we are moving into the 30s anytime now...
good report released by zeus on researchtree few days ago...looks at UK and EU gaming sector...the conclusion of which looking at all the numbers is that TB is way way way way undervalued vs. literally every other name. However...are we missing something more serious? I just don't know...but at these multiples of value its starting to get to stage where it is worth just taking the risk from valuation standpoint...
Interesting to finally see some discussion here!
Completely agree that VK is not key part of investment case….but find it very hard to believe they will not get a settlement after therium case last year…really not sure what could drive a market. Belief they will lose??? Thoughts?
this has been a fairly fascinating share to watch...i've never spent so long deliberating over something in the market. in many ways...there are a lot of pluses here. if alex executes long term from here...the opportunity is huge. no doubt at these levels it could be a 10 bagger over the medium term...and generally having a high conviction founder leading the business is a good thing.
however...there are a lot of moving parts here...something this forum has done an excellent job of debating about. certainly helped me with my decision making here. potential pitfalls:
1. the business is now generating a lot of revenue from past titles. that is fine but not going to be the key determinant to success here. tinybuild need some home runs with own IP developed games that can be built into franchises. that's what would make this a bagger and actually mean the cash spent has been a good strategy. they might be able to succeed...but HN 2 has clearly not been a huge success - most evident as Alex never stopped talking about it and I got distinct impression in results/presentation that he was trying to not focus on it.
2. gaming is really consumer taste sensitive...a few wrong moves or bad titles and suddenly everyone just leaves you. very little actual consumer loyalty and its a hard business to analyse in that regard for PI's. This and the above point make me most nervous. dodgy shareholder dealings and more cash being spent on investment I can live with...but if the games aren't hitting consumers in the right way, this share will be down the toilet.
3. as well pointed out today on the forum...cfo is clearly out of his depth (which may be how alex wants it)...thats a real problem when you have a very capital intensive business which has ramped up investment, both in headcount and game development AND acquisitions. wouldn't take much for things to really get out of control.
4. shareholder disclosure has been really poor and the COO leaving abruptly seems honestly a bit suspicious. may be nothing at all...but if he's left and sold shares at these gutter prices, it does really worry me. stock is now crazily valued vs. the other gaming companies, and is at lower multiples vs. devolver etc...and at very hefty discounts vs. T17. any insider selling at these levels or under even a quid just makes me really question whats going on internally.
for all of those reasons i'm going to hold off until more clarity on how there games are being received. but one im going to be watching daily and best of luck to those who are invested.