[Podcasts] HARGREAVES LANSDOWN, FOCUSRITE, STRIX, QUARTIX And More

21 October 2023
By Maynard Paton

I have recorded two podcasts during October with good friends and fellow investors Roland Head, Mark Simpson and Bruce Packard:

Our Investors Roundtable Podcast discussed Bruce’s liking for Hargreaves Lansdown, why Focusrite has appeared on my radar and why Mark reckons Strix is undervalued.

Roland and I also discussed telematics specialist Quartix for the latest Private Investor’s Podcast.

During the Investors Roundtable Podcast, we covered:

Hargreaves Lansdown (750p/£3.5b):

• Bruce recapped why Hargreaves Lansdown is a ‘quality compounder’, which prompted the following points:
  • The P/E of 12 and 6% yield, entering the wealth-management sector and strategy criticism from Peter Hargreaves.
  • The new chief executive, account popularity among private investors and charging high fees.   
  • Clients holding cash, permanently higher IT costs and future growth rates.

Focusrite (500p/£300m):

• I recapped the attractions of Focusrite, which prompted the following points:
  • The lack of recent organic growth, returns on reinvested earnings and the replacement cycle of music equipment. 
  • New product development, the tentative latest trading statement and low free cash generation.
  • High stock levels, supply-chain issues and the potential for a founder-led sale. 

Strix (55p/£120m):

• Mark recapped the recovery upside potential of Strix, which prompted the following points:
  • A possible EV to earnings of 7, the chief exec’s shareholding and the likelihood of another profit wobble.  
  • Previously higher debt levels, buying private-equity flotations after problems and the company’s much higher interest costs. 
  • Management’s sales targets, Mark buying after the profit warning and kettle-usage advice from cheapskate investors. 

During the Private Investor’s Podcast, Roland and I covered telematics specialist Quartix. We talked about: 

• The commendable dividend record and attractive financials that make the company an intriguing watch-list share.
• What the telematics service offers, the typical customers and past growth.
• The company’s ‘scalability’, payback periods and high gross margins.
• Customer churn, customer longevity and new customer acquisition.
• Stagnant profit, the declining profit margin, greater employee costs and staff turnover.
• Reduced revenue per tracker, overseas expansion and the group’s competitive advantage. 
• Co-founder Andrew Walters’ comeback, option targets and the major institutional shareholders. 
• July’s H1 figures, forecasts for 2023/4 and our valuation thoughts.

You can listen to both of these podcasts (and more!) through this premium podcast service >>

Happy listening!

Maynard Paton