Member Info for rivaldo

They now forecast €0.5c EPS for this year and an increased €0.9c EPS for next year (2024) with a P/E of only 4.1 - and that's on "cautious volume assumptions":

Extract:

"Cashew moves to 100% ownership; transformative project moving ahead

This morning’s announcement that the company’s stake in its Tiebissou raw cashew nut (RCN) processing project is being raised from 70.7% to 100% appears well-aligned to the company’s strategy of growth and diversification, and particularly so at a point when the cashew project is set to deliver significant rewards in FY2023-24 and beyond. DKL is an increasingly diversified agricultural concern focussed on West Africa (Ivory Coast) whose portfolio of projects includes a fully operational sustainably sourced palm oil business.

Once in full operation, the cashew project is expected to contribute over €12m of revenue in FY24E, a very significant lift in the context of our €31m FY22E revenue forecast, with strong positive cash flows and even greater potential in the long run. The new operation significantly increases the overall scope and scale of DKL’s activities as a growing multi-commodity agricultural group, and this will be even more the case looking out beyond the current year as the cashew processing plant steps up further from its planned FY23E initial processing rate. Looking further out, the company also has credible green energy ambitions. With a value accretive share acquisition, our fair value assessment is raised to 9.5p (formerly 9.0p) and we continue to see upside for this stock."

"Forecasts / Valuation We refer readers to our DKL Initiation Note published in June 2022, for more information. We see the company making excellent progress, and are encouraged by this morning’s newsflow. Seeking to retain conservatism in our forecasts, we make adjustments based on cautious volume assumptions, which may however prove overblown (see below). At the same time, our EPS forecast is upgraded for FY24 on the back of today’s announcement. DCF and comparator-based fair value assessment is raised from 9.0p to 9.5p."

Reacting nicely to a little buying. Hopefully our overhang has cleared.....

Extensive summary of CNIC, with the target price raised to 200p (still some way short of Berenberg's 250p target) - here's Mark Watson Mitchell's conclusion:

Https://masterinvestor.co.uk/equities/centralnic-looking-ahead-to-q4-results/?mc_cid=33f82f963a&mc_eid=db9f9bbaf2

"The Berenberg Price Objective Is 250p A Share.

Analyst Bob Liao at Zeus Capital, the group’s NOMAD and joint broker, has views out for $709.6m revenues in 2022, EBITDA of $82.0m and earnings of 20.9c per share.

The current year sees him going for $752.2m sales, $88.6m EBITDA and 22.0c earnings.

For 2024 his figures suggest $797.6m revenues, EBITDA of $93.9m and earnings of 23.6c per share.

My View – Setting A New Target Price Of 200p

This group is worthy of a significantly higher market rating than it has currently.

I am a great fan of its annual recurring revenues and its massive global cash generation.

It has a proven business model and is totally scalable as it grows strongly.

Continually researching the mass of UK-quoted smaller companies, as I do, I witness a vast array of overvalued, overhyped rubbish rated on ridiculous ratios.

So, when I identify companies, such as CentralNic Group, I find it difficult to understand why others trade on such gross premiums to value.

The shares, ahead of next Monday’s Q4 Trading Update, are currently only 144p – which in my view is totally out of kilter with the market.

I would hope that next week’s statement will bring about some upward regrading of estimates by brokers and the market generally.

Is it possible that another ‘share buyback’ programme could be announced shortly?

I have absolutely no doubt that this group’s shares are heading higher, with my new Target Price now being fixed at 200p, which could be easily achieved within the next few months.

‘Value will out’ and that will happen with CentralNic. These shares are definitely for buying at around the current levels."

Great analysis of the trading update from Mark Simpson's Small Caps Live - here's the conclusion:

Https://smallcapslife.substack.com/p/small-caps-live-weekly-summary-8fd

"The company is starting to be more than a drilling company, with MSALABS showing continued growth:

• MSALABS now has four units commissioned across Africa and Canada, with three further units due to begin operations in Q1 2023, including Barrick's Kibali Gold Mine;

• Trials with major mining companies are continuing with PhotonAssay in high demand globally. The expanded relationship with Chrysos will see MSALABS deploy 21 units by 2025, giving the company a strong competitive position in the coming years;

The guidance for revenue for the year just gone from MSALABS is around $30m, which from four newly commissioned Chrysos units and their existing fire assay business makes their 2025 estimate of $80m revenue from 21 Chrysos units look very conservative. Of course, the first units will go where they get maximum utilisation. But still, it is easy to see a route to $100m+ revenue here. With 25-30% EBITDA margin, their 75% stake in this business could represent a significant part of the current market cap.

Anyway, in summary have yet another beat, pretty significant on a quarterly basis, confirmation of further imminent progress at MSLABS and an upbeat outlook statement.

Despite this, the initial share price increase in response to this positive statement was met with selling. Partly this reflects that the share price had been strong in the run up to this trading statement and investors were “buying the rumour and selling the fact.”

It goes to show that the company’s shares are still pretty illiquid. It seems a few smaller investors may have been overweight and would be sellers at any price on the day. If this is the case, then it is easy to see why the share would be volatile.

However, those sellers may come to regret it, since this remains one of the cheapest shares on the market with excellent short and medium-term business momentum."

Well worth noting from today's RNS is:

"Our ambition is to double our sales and significantly improve our net margin and earnings per share within the next four years"

With doubled sales one could perhaps expect EPS to rise to anywhere from 18p to say 25p EPS given economies of scale etc, which would support a share price of.....much, much more than where we are today.

The short-term timeframes of many investors never fails to surprise me. After the debacle of Lakehouse, the "new" management team at SUR have taken the share price up more than 150% from early 2020 - and this during the pandemic! In fact, there can't be that many better performing shares than SUR since the pandemic began.

With such a rise it's natural there's been a period of consolidation. One might take today's terrific results as being a signal that the period of consolidation is about to end and we could be at the start of a further re-rating.

Especially as there could be news of the sale of the non-core divisions at any time - or indeed of an earnings-enhancing acquisition from the £23m cash pile.

Good to see ADF's Location One expanding into Scotland's "newest and largest film studio", where ADF are already established:

Https://uk.advfn.com/stock-market/london/facilities-by-adf-ADF/share-news/Facilities-by-ADF-plc-Location-One-joins-ADF-at-Pi/90041500

Nice tweet from CAPD about the booming number of mining financings (with a bar chart I can't replicate) - bodes well for CAPD:

Https://mobile.twitter.com/_CapitalLimited/status/1617339593170489345

"S&P Global’s Dec 22 financing data - 62% increase in funds raised by junior & intermediate miners, & a 75% increase in the no. of transactions, a 12-month high. Material increase in significant financings (US$2M +) to 90, from 58 in Nov. Gold financings up 146% on Nov to US$374M."

Excellent news, cheers - this is a "bumper" £2 billion framework securing income through 2024-29 with an option for a further three years to 2032. RNWH are one of only five contractors on the framework, but have won substantial work in winning two of the six contracts - you'd have thought this might be worth an RNSNON at the very least.

Great to see RNWH winning the electrification contract, proving that the acquisition of Giffen was a smart move and hopefully setting AmcoGiffen up for many more electrification contract wins.

I also note that these "will be followed by similar contracts for signalling later in 2023".

Hi Genghis15. CAPD took advantage of the poor equity markets in 2019 when financing for gold companies became extremely difficult. At that time they took a number of stakes in mainly listed companies in Australia and Canada which needed financing at knock-down prices. Since then the value of those investments has rocketed, and even with a decline in 2022 the value of the portfolio has tripled despite some share sales by CAPD. The value of this portfolio is completely unrecognised in the share price despite backing up nearly 15% of the entire m/cap!

One of CAPD's investments is a $10.9m investment in an unlisted company called Allied Gold Corp. Allied have said previously that they intend to list at some point, and they initially tried a year or more ago but were thwarted by the poor equity markets - when they do the upside could be very large indeed given the amount invested.

Forecasts for the business as a whole should now be raised for this year to say 10p EPS - even on a miserly P/E of 12 that would give good upside to 120p.

But taking into account the secure and long-term nature of SUR's revenues, the huge order books, the growth in renewables and the potential for growth both organically and via acquisition, one could easily argue for a multiple of 15 and a 150p share price target. Then add in the cash pile worth around 14p per share and you reach a target of 165p.

Excellent news - DKL have purchased the remaining 29% of the cashew project and now own 100%, and for a relatively paltry £619k in shares. A shame that the share price isn't higher for less dilution, but then perhaps this makes it an opportune time for the sellers.

DKL can now push on with ramping up production and maximising shareholder value:

Https://uk.advfn.com/stock-market/london/dekel-agri-vision-DKL/share-news/Dekel-Agri-Vision-PLC-Increased-acquisition-of-Cas/90041379

Terrific results - well ahead of expectations with 9p EPS (up 29% and compared to the 8.1p EPS forecast):

- 9p EPS is almost up with 9.2p forecast for this next year through to Sept'23!
- plus SUR have a £23.3m cash pile, 17% of the m/cap
- the order book is up 18% to a massive £594m
- revenue, PBT and EBITDA on continuing operations are all way ahead of forecasts
- CorEnergy acquisition is trading ahead of expectations
- huge visibility of forward revenues stretching out for years ahead

And importantly, SUR have made "a good start to trading in FY23" and are confident in this year's outlook.

SUR should be congratulated on a superb performance and excellent outlook - on a historic P/E of 9.4 SUR are very, very good value.

WH Ireland have reiterated their 120p target price. They've left their forecasts unchanged at present at 6.7p EPS this year and 8.4p EPS next year, with the cash pile rising from £3.5m to £3.6m and then £3.8m respectively.

They "believe valuation multiples have significant scope to expand".

I suspect that WHI will upgrade their forecasts when the prelims are released as analysts tend to do.

Given the cash pile representing 50% of the m/cap, based on 8.4p forward EPS and a P/E of say 14, it's possible to see a sum of the parts valuation of perhaps 160p-170p, though of course we need to see the year end debtors/creditors etc.

Here's WH Ireland's summary:

"Full year trading update illustrates further positive progress in the year

Touchstar is a supplier of mobile data computing solutions and managed services to a variety of industrial sectors. This morning, the group has reported a positive year-end trading update for the 12 months to 31 December 2022, pointing to revenue and PBT in line and cash generation well ahead of our forecast. Revenue is expected to be 10% ahead of FY2021A (FY2021A £6.1m), with EBITDA up 25% and PBT increasing 100% (FY2021A £0.2m), reflecting strong operational gearing and continued margin progression.

The year-end net cash position at £3.5m was significantly higher than expected (WHI est. FY2022E £2.5m), a result of strong cash conversion in the period. Looking forward, current trading is reported to be buoyant, with a significant increase in the order book to £1.7m (30 June 2022: £1.0m) and an increasing share of recurring revenue at 40% (FY21: 38%) supporting our forecasts.

The shares now trade on an FY 2023E EV/Revenue multiple of just 0.4x, EV/EBITDA of just 2.0x and PER of 11.9x. With 40% of revenue now being recurring in nature, we believe there is the potential for the shares to continue to re-rate as the strategy continues to be successfully executed. We see fair value for the shares at 120p."

Agreed - an excellent update, well written and everything laid out clearly:

- the core business is performing well
- GTC have £4.3m net cash against the £9m m/cap
- Kitson House is now under offer (albeit sale completion delayed)
- hydrogen strategy is understandable and progressing
- diversification into geothermal, lithium, natural hydrogen, gold, copper, cobalt, helium etc
- strong outlook with record order book and recurring revenues rising

No mention of the bottom line AFAICS, but at this valuation and with the cash pile (plus Kitson House) representing so much of the m/cap - and apparently remaining steady - it's the outlook and potential which are more important.

Some director buying would indeed be a nice signal - I assume there's nothing stopping them buying now that the update's out and the results aren't due until May.

A bullish-sounding tweet from the CEO, who notes:

"There are currently 197 productions in development 22 in pre-production 33 in production. Great stats that show the upward trend in our booming #tv & #film industry is continuing in 2023

Likewise for @FacilitiesByADF who are supplying 19 of 33 shows ??????????????????"

Https://twitter.com/marsproctor/status/1615634936970592257

I can see that ADF worked on 39 productions in total in 2021, and in H1'22 alone they worked on 46 productions. So it's an interesting balance - one would want to see ADF working on an ever-increasing number of productions, and the start to 2023 appears to be good in that respect.

Yet H1'22 saw an increase in productions worked on with lower profits due amongst other things to higher transit costs etc between shorter timeframe productions, apparently to be remedied in H2 given the forward order book containing a much higher proportion of longer term and thus more profitable shoots.

The CEO seems to be happy about things anyway!

The recent small overhang has now been partly cleared by this morning's buying.

Online you can now sell 15k, whereas you can only buy a maximum 10k at the full 90p offer (more than is usually available).

At 90p I calculate an ex-cash P/E for this year based on the previously forecast 6.7p EPS of only 7.3.

And this forecast includes precisely zero interest receivable. If you add in say interest at 3.5% on a steady £3.5m cash that would bring in a further £125k or so, i.e a further 1.5p EPS, taking the forecast up to 8.25p EPS.

The ex-cash P/E would therefore reduce further to just 5.9.

Tipped by Ken Wotton from the wealth manager Gresham House (who hold almost 30% of the company).

He predicts that Inspired Energy, an advisory firm that helps almost 3,000 businesses to cut their energy costs, could be an attractive takeover target. In the meantime, the firm "has an attractive investment case, high-quality management and a good financial profile, including a growing dividend":

https://www.thetimes.co.uk/article/stock-market-bargains-you-can-still-grab-nv6fkvlx6

Ken Wotton is also interviewed on Citywire noting that at these levels, without a re-rating, INSE is likely to become a takeover candidate - one of its sector comparators (Zenergi) was apparently acqired last year at double INSE's current multiple. Listen from just over 10 minutes in:

Https://citywire.com/funds-insider/news/ken-wotton-takeover-resurgence-should-drive-uk-small-cap/a2406962

For transparency I decided to sell all the rest of my holding on Friday after SPT's profit warning, having had a rethink after my initial sales and post here. On such a premium multiple any doubt or concern over trading could translate into quite a hefty reversal, so I decided to crystallise my several "birds in the hand"!

My sales seemed to be made into good liquidity, so there seemed to be decent demand out ther although as Friday continued the price did seem to be dropping further.

Good luck all. I may well be entirely wrong as this is a good quality company with an evidently very capable CEO. It's just that at this point the downside risk seems to heavily outweigh the upside.

This is an extremely encouraging year end update. EBITDA is ahead of expectations, all other measures are nicely in line - and the cash pile is way ahead of expectations at £3.5m (forecast was £2.4m).

That £3.5m cash now represents 52% of the market cap!

Alongside this, the now historic EPS should be around 5.5p. This year is forecast to bring 6.7p EPS, but this should be conservative given the "buoyant" order book, which is up to £1.7m from just £0.6m a year ago.

With 40% recurring income now, TST are in a great place.

Plus with interest rates rising, the cash pile will generate very nice interest receivable to add to the excellent prospects.

And it's encouraging to note not only the various ways in which that cash will fuel organic growth, but also to see IM state for the first time that acquisitions are now on the cards....

Continued:

"Conclusion: This is the third consecutive year of revenue growth for Capital which once again affirms the Company’s growth trajectory. Its three main business streams: drilling, mine services and laboratory testing offer stable and diverse revenues with, in our view, the most near-term growth to be seen with the MSALABS business and mining services. With the further roll out of Chrysos and continued drilling activity in Africa we expect this growth lasting well into 2024. The shares are trading on a 2023E and 2024E EV/EBITDA of 3.0x and 3.3x and P/E of 7.2x and 8.6x respectively – see Block Model.

We remain confident that the levelling out of growth we are currently forecasting for 2024, based on Sukari rolling off, is highly unlikely and that the company will transact further major contracts across all business units which will see revenue continue to expand into 2024 and beyond. Meanwhile we are forecasting a dividend yield of 2.8%. We retain our PT of 160p."