Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Not sure it was worth the wait but I think it is profit taking JDGL. D4t4 probably needs positive news flow to continue the upward trajectory and even then the valuation is a point of debate. They are still likely to need to transition a further 30%-40% of their business from licenses to SaaS and that is a material drag on near term revenue growth and margins. From these earnings and cashflow multiples the group needs to deliver multiple years of 20%+ profitability growth to look conventionally attractively rated (or one very very big year). The market opportunity and quality of the core technology are probably consistent with that objective, but as I started by saying the market probably needs re-afirmation in the form of a positive trading update/new order intake.
One of the other boards mentions a tip in a small cap newsletter............... & has a vibrant debate about whether this should have been mentioned on the forum. I'm not aware of the content, but presume it was bullish, although it is hard to believe that it contains anything new.
The advantages of the scrip dividend aren't obvious apart from, optically, giving the impression of a stable dividend record. Sadly this is looking like a company that has lost interest in its retail investors. If you would like a few clues to what they have been discussing on their (institutional?) investor roadshow there is a presentation at https://www.dukeroyalty.com/investors/aim-26-checklist#reports
1H numbers were horrible. Management believes it can fully recoup the shortfall in 2H. It is encouraging to see the non exec Chairman and former CEO putting �150K of their own money where their RNS is, but there are no guarantees. Borrowing from Sir Alex F, at the very least holders are looking at some 'squeaky bum time' in Q4
Orangetree. Thanks for you thoughts. I am a long term holder of D4t4 so that might mean I am a glass half full rather than half empty type, but I think there is some more nuance on some of the points you made. Regarding the major customer, I think there is an issue with accounting boxes here, arguably a better term might be 'major relationship'. The 50% most likely relates one of their major reseller relationships, basically D4T4 is utilising the business intelligence & analytics solutions of a major international corporation to provide tailored customer analytics solutions to a broad range of end clients. There is still risk in the relationship of course, but the end customer base is much more broadly spread than the 50% figure might imply.. Conversely, the fall in UK revenues and the pressure on recurring revenues does demonstrate a historic problem with customer concentration. For a number of years D4t4 (or IS Solutions as it used to be) had a very substantial Asian customer. That customer has been through a torid time and in line with other suppliers D4t4 has seen a precipitous decline in sales. I don't know the figures but would guestimate a peak to trough revenue loss of the order of £3mn, a big chunk of which will have fallen away in the last 2 years. The half full interpretation would be that management has done a pretty impressive job growing profitability against that backdrop (although as a major $ earner currencies have been very helpful too). Nonetheless,. I think there is a lot of underlying growth momentum in the D4T4 business which has been partially obscured by the large customers problems and some lengthening of sale cycles. It that is right we should see a major pick up in sales growth this year. Time will tell.
Very much agree with your sentiments investz. TAP is a typical 'orphan stock', an Israeli tech stock quoted on AIM which does not have a wide following. The fact the company is exiting its traditional internet display advertising business is also partially disguising the explosive growth in the mobile advertising business. Even the US 'hedge?' fund Lazarus which has recently gone through 8% is someone I've never heard of. This still looks very attractively valued even after the recent share price rise which I don't believe has kept up with the upgrades, Back of the envelope TAP looks as if it could still be on a single digit PE in the current year even before allowing for higher amortisation than capitalisation and net cash on the balance sheet. The one thing I can't get my mind around is the threat to the business model. For me mobile advertising verges on the dark side and I don't know enough about the tech to know whether it is vulnerable to ad blocking or derivative techologies. Nonetheless, that is an investment risk that I've been happy to run.
Hi. New to the forum so comments are a bit belated, In my opinion this stock is 95% about the $. Sensitivities are tucked away in the report & accounts but co. estimates each cent rise in $ v £ adds £0.125mn to pretax profits, with around a 16c rally since July lows that is an annualised swing of £2mn, massive in company terms. Share some significant concerns about management, although more from the governance side, & whilst, as an investor, happy that the P&L will show a sharp rebound, not so happy that latest currency windfall will take some of the pressure off management to deliver organically. Also interesting article on leather market on bloomberg: Why Fewer U.S. Cows Means Higher Costs for Leather Bags although US orientated and not so easy to read implications for company