Maynard Paton | Category: My Shares

Oleeo: 155-Word H1 Statement Could Strangely Mark The Low Point For Earnings As £13m Market Cap Compares To £11m Net Cash Position

07 May 2019
By Maynard Paton

Results verdict on Oleeo (OLEE):

A terse 155-word statement revealed an unsurprising 50% profit plunge as OLEE extends its “capacity to suffer” to four years.

At least revenue continues to inch ahead and might even be growing at a reasonable pace if the largest customer is excluded.

Recent client installations include all four Welsh police forces — cementing OLEE’s 50%-plus share of supplying UK police recruitment IT.

A lack of guidance for the full-year could strangely mark the low point for earnings.

A £13m market cap is almost entirely supported by the £11m net cash position. I continue to hold.

M Winkworth: Franchisees Continue To Gain On Foxtons As Acceptable 2018 Figures Support Yield Of 6%

18 April 2019
By Maynard Paton

Results verdict on M Winkworth (WINK):

Collecting a greater proportion of franchisee estate-agent income supported an acceptable rate of growth.

Subdued sector conditions likely to persist until “relative [political] stability” emerges.

Further market-share gains won from London rival Foxtons, while threat of online competition continues to subside.

Accounts still exhibit high margins, a cash-flush balance sheet and appealing returns on equity.

P/E of 11 and yield of 6% do not appear expensive should earnings resume their momentum. I continue to hold.

Bioventix: Bumper H1 Results Showcase ‘Modest’ 24% Growth As Renewed Troponin Optimism Helps Sustain 34x P/E

16 April 2019
By Maynard Paton

Results verdict on Bioventix (BVXP):

Very satisfactory 24% growth led by ongoing “modest” demand for the group’s vitamin D antibody.

Effect of terminated product licence may have obscured an underlying 28% revenue advance.

Fledgling troponin product plus various pipeline developments offer intriguing long-term potential.

First-class accounts continue to exhibit terrific margins, net cash and scope for further special dividends.

Valuation remains understandably rich with an underlying P/E of 34. I continue to hold.

S & U: Record FY Results Show Dividend Up 12% But Management Hints Of Slowing Growth Leave Yield At 6%-Plus

05 April 2019
By Maynard Paton

Results verdict on S & U (SUS):

Satisfactory double-digit growth supported mostly by additional car loans issued during the first half.

Rising bad debts clearly indicate borrowers are no longer as profitable or reliable as they once were.

Improved first-payment rate suggests underwriting tweaks have started to curb future write-offs.

Reduced level of customer lending during the second half generated surplus cash and lowered group debt.

P/E of 10.7 and yield of 6.2% reflect management hints of slowing progress. I continue to hold.

FW Thorpe: H1 Results Confirm 10% Profit Drop As Cash Piles Up To New £53m Record

29 March 2019
By Maynard Paton

Results verdict on FW Thorpe (TFW):

Lower revenue and profit due to “challenging trading conditions” caused perhaps by the collapse of Carillion.

The statement’s highlight was management talk of orders having returned to “record levels”.

Fresh product developments continue and include “radical” new range of workplace lighting.

Accounts showcase huge £53m cash pile while dividend on course for 17th consecutive annual increase.

Underlying P/E of 21 seems optimistic given recent progress. I continue to hold.

Tasty: Equity Placing On The Way As Results Offer Glimmers Of Hope Amid Further Losses And Significant Debt

22 March 2019
By Maynard Paton

Results verdict on Tasty (TAST):

Miserable figures blighted by debts and losses that confirmed — albeit within the small-print — that an equity placing is on the way.

The shares are now a gamble based on how much shareholders are asked to raise and at what price.

Second-half trading offered hope through greater cash generation alongside improved sales per restaurant and per employee.

Restaurants continue to be sold for cash although current trading was described as “slow”.

Market cap now £4.2m for sales of £47m and 58 restaurants. I continue to hold.

Mincon: Acceptable 2018 Results Show 10% Organic Growth And Outline ‘Disruptive’ New Drilling Product

20 March 2019
By Maynard Paton

Results verdict on Mincon (MCON):

Acceptable double-digit growth supported by encouraging organic sales and the purchase of Driconeq.

New ‘Greenhammer’ product appears to offer attractive possibilities through “disruptive technology”.

Year ahead to focus on consolidating operations after bumper orders created production constraints during 2017 and 2018. Recent trading not buoyant.

Accounts offer scope for improvement as hefty stock build-up unwinds, capital expenditure falls and cost savings are found.

The underlying P/E of 19 is not an obvious bargain. I continue to hold.

Tristel: Record H1 Results Deliver Wonderful 28% Dividend Lift But Further FDA-Project Mishaps Dash Any Hope Of Early US Sales

28 February 2019
By Maynard Paton

Results verdict on Tristel (TSTL):

Very satisfactory double-digit growth supported by encouraging progress both within the UK and abroad.

A new product and a recent acquisition offer attractive medium-term potential.

Continued bungling of the US regulatory project raises awkward questions about the associated consultants and decision-makers.

Accounts remain in good shape with high margins, net cash and conservative reporting of ‘one off’ costs.

Valuation remains understandably rich with an underlying P/E of 26. I continue to hold.

City Of London Investment: Dividend Yield Now 7.5% As H1 Profit Drops 21% And Tough Markets Extend Wait For Significant New Clients

18 January 2019
By Maynard Paton

Results verdict on City of London Investment (CLIG):

Monthly updates had already braced shareholders for lower funds under management — which in turn reduced first-half profit by 21%.

Tough markets have again prompted the fund manager to cut its projections, as fee rates are trimmed and costs creep higher.

As before, significant new clients are required to bolster earnings and support a decisive share-price re-rating.

I am hopeful the replacement chief executive might one day re-energise the group’s marketing.

The accounts remain cash-rich and high-margin, and the shares yield 7.5%. I continue to hold.

My Portfolio: Year In Review 2018

01 January 2019
By Maynard Paton

Happy New Year!

I trust you enjoyed the festive break and are now raring to do battle with the market for another twelve months!

This first Blog post of 2019 provides a ‘year in review’ of my current portfolio holdings. I recap how each of the underlying businesses performed during 2018, as well as provide a few remarks about valuation.

Daejan: 203-Word H1 Statement Reveals £116 Per Share NAV High And Leaves £58 Share Price At A Favourable 50% Discount

07 December 2018
By Maynard Paton

Update on Daejan (DJAN).

Event: Interim results for the six months to 30 September 2018 published 28 November 2018.

Summary: The commercial property group once again delivered record first-half revenue and net asset value (NAV) figures — despite the chairman’s persistent economic and political worries. The 203-word statement gave little else away, which has allowed the share price to continue to drift and the discount to NAV widen to 50%. Such a valuation has typically rewarded patient investors of this low-profile share, and I have recently bought more.

Mountview Estates: NAV Creeps To New £92 Per Share High Despite Weakest H1 For 5 Years

07 December 2018
By Maynard Paton

Update on Mountview Estates (MTVW).

Event: Interim results for the six months to 30 September 2018 published 22 November 2018.

Summary: The property-trading specialist revealed its weakest first-half performance since 2013 after selling eleven fewer houses than this time last year. Furthermore, the 133% investment return achieved from those disposals was below MTVW’s ten-year average. Nonetheless, net asset value (NAV) still managed to creep to a fresh £92 per share high. Meanwhile, dissident shareholders continue to vote against MTVW’s directors and may be growing in number. The £100 shares do not appear expensive on an NAV and yield basis, and I have recently bought more.

Castings: H1 Results Reveal Machining Turnaround Delayed By 2 Years While Depreciation Review Inflates Group Profit By 10%

15 November 2018
By Maynard Paton

Update on Castings (CGS).

Event: Interim results for the six months to 30 September 2018 published 13 November 2018.

Summary: CGS’s results were acceptable but contained several irritating drawbacks. In particular, a recovery at the engineer’s troubled machining division has been seemingly postponed for two years. Furthermore, management has now downgraded customer demand from “strong” to “steady”. Oh, and a depreciation review inflated group profit by 10%. CGS does have strengths — not least its cash pile and dividend history — but I suspect the firm’s stalled earnings will keep the shares marooned for now. I continue to hold.

Oleeo: The 4:28pm Results Revealed A Further Earnings Slump As Anonymous Tip-Off Corrects My HMRC Mistake

07 November 2018
By Maynard Paton

Update on Oleeo (OLEE).

Event: Preliminary results for the twelve months to 31 July 2018 published 02 November 2018.

Summary: Publishing results at 4:28pm on a Friday is never a good sign. And sure enough, the recruitment software outfit warned of yet another profit slump. Still, at least revenue inched to a new record as the firm enjoyed greater subscription income. Meanwhile, an anonymous tip-off has set me straight about OLEE’s contract with HMRC — the deal appears not to have been lost after all. All I can do now with this illiquid share is hope for an earnings rebound. I continue to hold.

System1: H1 Results Could Mean The P/E Is Just 9… Assuming The Ad Ratings Service Eventually Becomes A Money-Spinner (I’m Not Sure)

06 November 2018
By Maynard Paton

Update on System1 (SYS1).

Event: Interim results for the six months to 30 September 2018 published 02 November 2018.

Summary: A couple of earlier updates had already signalled this lacklustre first-half performance. Indeed, several references to competitive pricing and re-designed products implied the advertising research specialist may no longer be the ‘pioneering’ force it once was. Furthermore, the new Ad Ratings service could be hard pushed to become a real money-spinner and return the group to growth. That said, margins remain good, there is cash in the bank and the P/E might be 9… if you believe some significant development expenditure will eventually pay off. I continue to hold.

Patrick Leach: “Hi Patrick, Just replying to your comment as I have held SYS1 for a number of years and exchanged views…” 12 Jul 2024

Andrew Rolfe: “Maynard, I hold through HL, Interactive Investors and a couple of other platforms. I think that CLIG should engage via…” 10 Jul 2024

Maynard Paton: “Thanks Andrew. I hope to be there at the AGM as well. Something I did not mention in the blog…” 10 Jul 2024

Andrew Rolfe: “Excellent review, as ever, Maynard. As you know, I do not think that the disclosures to date that CLIG has…” 10 Jul 2024

Maynard Paton: “Thanks David, glad you found it useful Maynard” 04 Jul 2024

Maynard Paton: “Thanks Patrick. I don’t recommend anybody follow what I do, but happy things have worked out so far! Maynard” 04 Jul 2024

David: “Great analysis, very much appreciated.” 04 Jul 2024

Patrick: “Sparkling results and a very bullish outlook. I followed you in on this one Maynard with a position that in…” 03 Jul 2024