Member Info for MattTheBrave

...and yet there it goes back to 49 again!! I wonder whether there's a large holder who is constantly reducing their stake into strength? A low capital intensity business with growing sales and margins on what is almost a single digit PE comes out with a positive trading statement and its price falls?? Good old AIM eh!!

All looks good. Debt only down a tad, but given the FCF generation (approaching £10m on an annualised basis), this shouldn't represent a long term issue. There's been a lot of negative sentiment in this stock (on no real news as far as I can see) for some time - let's hope that this news finally quietens the naysayers!

New acquisition consistent with strategy, plus salmosan volumes recovered. Worth adding here I think.

I think this stock is toast, which is a shame. The message from the management is that this is simply a revenue issue caused by falls in demand from the oil industry, but in fact, there is also a complete collapse in margins. Looks like LED is now becoming a commoditised market, so even if volumes recover, pricing looks to have gone, so profit recovery likely to be muted. I sold my last of position yesterday on seeing the figures.

Yes. You're just focussing on the profit/return and ignoring the cost of capital. The Company has to fund the purchase, either through debt or equity - both of these have an associated cost of capital and it is the success of the firm in generating a Return on that additional capital in excess of the COC which will determine whether the acquisition is accretive to eps, or dilutive. otherwise, based on your logic, every acquisition of a profitable company would be a positive for the share price, and we know that's not the case!

Thanks Bornand. a good, and frankly, worrying account. I like the fundamentals on this company, but to be honest, very worried about management greed here. As David says, the fact they introduced this just after the AGM so as to avoid direct scrutiny/questioning from shareholders reflects badly on these individuals. I'm going to give this some more thought, but AIM stuff is risky enough as it is, without having Directors like this, so selling my holding is a distinct possibility I think.

So, the bit I'm having trouble with is this: " The value to be received by the Participants at the end of the three year performance period will represent 15.38% of the market capitalisation of the Group above the Hurdle." Does this mean that if the mkt cap is above £85mn in 3 years, the directors get new shares making up 15% of the market cap (so diluting existing shareholders). = very bad Or, does this mean that if the mkt cap is above £85mn in 3 years, the directors get existing shares (which will have to be purchased over time) making up 15% of the market cap (so not diluting existing shareholders) = Good-ish Or, does it mean they get shares to the value of 15% of the EXCESS of the value of the market cap over £85mn ie if mkt cap is £95mn, they get £1.5m worth of shares (either new (=bad-ish) or existing (= good)) What do we think?

Because I didn't have perfect foresight in seeing that the company would lose a major European client? Read through your posts and don't remember you including this point as part of your sell recommendation. These things happen when investing. Glad you can laugh - presumably you get all your stock picks 100% right all the time? Or it's a low blow from someone who should know better.

Way too much weight being attached to currency translation in the posts below - I would never buy/sell a stock based on currency translation which tends to be mean reverting, and does not reflect the health of the underlying business. Constant currency sales and operating profit growth of 12% and 45% look pretty good to me and are backed up by a 25% hike in the dividend. When coupled with a PE valuation tending towards single figure over the next few years it feels like a reasonable risk reward trade-off below £2 to me.

...so hopefully we'll see the share price move back into the 50s!

...and back to the mid 40s, all of this on no news! Interim results on 30th July, so hopefully that will bring some cheer...!!

Point is that the debt is increasing due to investment required by new contracts which is a positive in my view, and I expect to the share price rise as the extra revenue and cash flow ultimately pay the debt down. Also, still only half the total facility they have in place with banks, so no sweat.

Yes, but once you realise the market is bullish it'll already be too late!

Agreed. The thing you always worry a bit about this sort of price movement on a small cap is that there's something percolating into the market which we don't know about. Hopefully not the case here and I agree, stock looks too cheap.

Very nice bounce indeed. Quite a relief I have to say - you see a 10% fall in a mid cap stock and you wonder what the hell's happened that you missed. Looks like this was one of those rare occurrences when the fall was genuinely on no news! Lance, you were right about the buying opp although I'm sad to say, I couldn't bring myself to do it.....!!

Weird!! Nice bounce today though!

...why the stock is down by 10% today. I cannot find any news at all.

4.4% yield, but I'm hoping for a better return!! ;)

Interest is 5x covered and they're only using half their banking facility, so the banks are relaxed. Also, this has come from investing in new contracts with Axa etc, so it's debt which will generate a return. Free cash flow of £6m and rising should start to make a hole in that pretty quickly. Divvy is 2.5x covered, which isn't out of line with other UK Companies. I think a lot of tis risk is in the price, given that it must be close a single digit PE on this year's earnings. As earnings grow, and debt is paid down,, should be good upside. Cherry on the cake? Majedie just took its stake above 5% - I respect these guys a lot in the UK small cap area, so a very supportive sign for me.

That happens on all the message Boards here. It's a bit weird - it seems that if no-one posts, they all disappear, only to re-appear once someone does. Clearly a glitch in LSE's software somewhere! On HCM, some real profit taking over the last few days which isn't surprising - I might have let a few go myself.....