Interesting page, noting that Surface Transforms discs can replace and are "lighter, more powerful and cheaper" than those of Porsche, McLaren, Ferrari, Nissan, Mercedes, Aston Martin and Koenigsegg.....
HotStockRockets says Buy this afternoon (subscriber-only):
"Touchstar – interims and expects full-year ahead of expectations: BUY
By HotStockRockets | Friday 17 September 2021
Mobile data computing and managed services company Touchstar (TST) has announced results for the first half of calendar 2021 and that it “has traded well in recent months, as a result we now expect full profits to be ahead of our previous expectations”. Sounds good......"
from Edison over 13 minutes. Lots of serious discussion and relevant questions - much better than the usual superficial three minute interviews.
Good to hear that we should continue to see a number of acquisitions, probably of smaller entities since the large sector peers and targets are more difficult to ensnare and are largely valued at multiples far above CNIC's (showing the disparity in valuations which Berenberg and Stifel have recently highlighted, with their target prices being double the current CNIC share price)!
Good H1 results today, with both Shire and Indulgence improving very nicely year on year.
Net assets (with no goodwill/intangibles) are £36.9m against a £33.2m m/cap, including £23m cash and £9.7m properties and plant.
The continuing businesses are essentially valued at nothing (actually negatively).
Yet with the big H2 seasonality, Shire looks like making between £2.5m-£3m PBT this year, even with a limited impact from the rising costs we all know about.
Indulgence will likely make a small loss this year, but is obviously on the right track now, especially if it can gain "mid-tier" ranges as suggsted today and increases its cheesecake range sales via Shire.
Plus there's more optimism about acquisition opportunities turning up with the end of the givernment support schemes:
IMO the share price may advance to 550p-600p relatively quickly.
Firstly, the placing for the huge acquisition was "multiple times oversubscribed" - so there must be extremely hefty demand out there.
Secondly, this acquisition gives KAPE legitimacy and status. The prior version of KAPE always had (remote) associations with Crossrider and long-gone dubious practices. But even tech dunces like me have heard of ExpressVPN! This at a stroke gives KAPE credibility and huge market heft, which should help with a strong re-rating.
Thirdly, KAPE was very undervalued anyway even prior to this news - and the acquisition simply exacerbates the undervaluation. At around a forecast round 30p EPS or so for next year, and considering KAPE's low EV/EBITDA multiple relative to sector peers like Avast, it's easy to see a 550p-600p share price in the relatively near future imo.
Finished listening to TST's H1 results presentation via WH Ireland.
Glad to hear a certain underlying tone of confidence coming through. A few quotes from the CEO:
"comfortable with" WH Ireland's newly increased forecasts
"there's a confidence in the business I've not seen"
"stronger team than we've had in a number of years"
Also worth noting that Ian seemed happier with the possibility of making acquisitions than in the past imo.
Transcript of a recent interview with Zeus Capital's analyst:
Apparently John Rosier in his tip indicated value at only 11.4 x free cash flow in the twelve months to 30th June and could easily be on 20.0 x. He noted Stifel's price target of 256p.
I've now finished listening to CNIC's hour long results presentation via Edison. Very impressive as usual.
One particular standout was that when the bonds are refinanced next year, CNIC stand to benefit by $2.5m per annum from interest expense savings as they'll be refinanced on more favourable terms. Which will be a nice continuing lift to profitability.
Very much looking forward to next Tuesday's H1 results and outlook given all the upgrades and now the huge ExpressVPN acquisition.
Also, KAPE are presenting on 21st September after the results at a Progressive Research event - free to register:
Also, REA Holdings reported H1 results last week, and commented:
"With CPO and CPKO prices expected to remain at remunerative levels, the group looks forward to a period of prosperity"
At the current 19.5p, the P/E for the year starting in only four months is only 12.8, which in itself is pretty cheap.
The PEG for the company is also just 0.75 based on the 17% growth forecast from this year to next. This is of course the measure most favoured by Jim Slater. Any company trading on a PEG of less than 1 is seen to be good value, so a value of 0.75 is extremely good value.
Interesting points from Shore Capital's new note today:
- with 28% earnings accretion, KAPE are forecast to make 40.6c EPS next year assuming the acquisition completes before 31st December, rising to 46.5c after that
- the resulting P/E of 13.6 for 2022 at 400p is extremely cheap for the sector
- ExpressVPN have 93% recurring revenues
- founders will own 14% of KAPE post-acquisition
- ExpressVPN is highly cash-generative, with expected cash conversion over 85%
- it has users in 180+ countries
- it has an 82% subscriber retention rate (very similar to KAPE's)
- it has extensive relationships with the likes of Acer, HP, Nokia and Philips whereby it's pre-installed on those brands' hardware. KAPE will likely leverage this for Cyberghost and PIA etc.
Looking great - apparently the push was initiated by a tip from IC columnist John Rosier, who's just bought CNIC into one of his portfolios.
Remember that the target rpices from Berenberg and Stifel are still more than double the current share price, even after this rise.
Lovely to see this today....
"The Board is very confident that trading for the year ending 31 December 2021 will be comfortably ahead of already upgraded management expectations"
Interesting to see that EKF are opening new facilities in relation to COVID testing kits "with the expectation that sales of these products will continue for the foreseeable future", and that "we are now discussing the supply of products for non-COVID-19 indications" resulting from the success of the COVID test kits.
Plus encouraging to hear that the core business "is capable of generating significant double-digit growth in adjusted EBITDA over the next three to four years".
A very strong set of H1 results today, remembering that this is the much seasonally weaker half so H2 will look even better.
ACSO reiterate that:
"we expect Cash EBITDA to be significantly ahead of market expectations for both the half and the full year"
The Balance Sheet is strong with $33m net cash. Virtual queueing is the future for all sectors across the globe given the pandemic - you just have to rad the narrative to see that this is the case. Prospects look very good here.
The placing is indeed at 337.5p, and was "multiple times oversubscribed".
KAPE's directors have subscribed a whopping additional $13m in the placing, and the founders of Express VPN have put in another $4m.....plus major shareholder Unkmind put in another $15m.
Full steam ahead methinks.