World Careers Network: Better-Than-Expected Results Give Cash-Adjusted P/E Of Less Than 7

27 April 2016
By Maynard Paton

Quick update on World Careers Network (WOR).

Event: Interim results for the six months to 31 January 2016 published 26 April

Summary: These figures were not as bad as I had feared, given WOR’s previous results had confessed to higher costs and lower profit. The outcome for the current year looks set to be better than I had anticipated, too. Notably, revenue moved higher despite one of the software group’s largest customers significantly reducing its payments. Meanwhile, the accounts remain cash-rich and the underlying P/E is less than 7. I continue to hold.

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Getech: The Dividend Has Gone But All Is Not Lost Just Yet

07 April 2016
By Maynard Paton

Quick update on Getech (GTC).

Event: Interim results for the six months to 31 January 2016 published 05 April

Summary: These interim results were poor, but that was no great surprise given GTC supplies specialist data and services to the battered oil and gas sector. At least the promise of cost cuts and a few new contracts ought to signal a better second half. Valuation remains tricky here with reported losses and a scrapped dividend, but the asset-rich balance sheet should see the business through the downturn. I continue to hold.

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Q1 2016: 1 New Buy, 2 Top-Ups And 2 Top-Slices

31 March 2016
By Maynard Paton

Happy Thursday! I hope you continue to find my Blog useful… and that your portfolio has started 2016 better than mine!

After enjoying a decent gain for 2015, I suppose it was inevitable I’d soon endure a rough time. And sure enough, some of my larger winners of last year succumbed to the market’s sharp falls during January and February.

That said, my portfolio has not been a total disaster — I’m down 5% so far this year. It’s not a great performance, but I am generally happy with the shares I own and I look forward to some sort of recovery! 

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Tasty: Profit Up 28% But I Am Not Entirely Satisfied

30 March 2016
By Maynard Paton

Quick update on Tasty (TAST).

Event: Preliminary results for the 52 weeks to 27 December 2015 published 30 March

Summary: An acceptable but not a spectacular set of results from this restaurant group, with the second half showing a slower rate of expansion. I also note revenue per outlet has declined while management is hinting strongly at greater investment spend. Nonetheless, the board is a class act, the opening schedule for new restaurants is accelerating and the longer-term potential remains sizeable. I continue to hold.

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M Winkworth: I Just Don’t Know If Online Rivals Will Crush These 31% Margins  

23 March 2016
By Maynard Paton

Quick update on M Winkworth (WINK).

Event: Final results for the year to 31 December 2015 published 23 March

Summary: A somewhat better set of figures than I had been anticipating from this estate-agency franchising business. The second-half looks to have been bolstered by extra franchisee fees, which helped WINK register a decent second half and improve its cash flow. Margins and returns on equity remain superb at 31%, the shares do not seem over-priced — but will the Internet crush the income of traditional estate agents? I just don’t know, but continue to hold.

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FW Thorpe: A Welcome 2p Special Dividend But The Board Could Pay Far More

21 March 2016
By Maynard Paton

Quick update on FW Thorpe (TFW).

Event: Interim results for the six months to December 2015 published 21 March

Summary: A respectable but not a spectacular set of figures, with underlying revenue and profit both advancing by 5%. Although progress at the group’s main Thorlux division looks to have stagnated, last year’s Dutch acquisition appears to be performing very well. A special 2p per share dividend was a welcome move, but a cash pile of 30p per share suggests much more could be distributed. I continue to hold.

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French Connection: The Cash Pile Really Can’t Afford Another £9m Outflow

15 March 2016
By Maynard Paton

Quick update on French Connection (FCCN).

Event: Preliminary results for the year to January 2016 published 15 March

Summary: An improved set of figures following last year’s awful interims. However, the numbers do suggest FCCN experienced a weaker Christmas while the cash pile really can’t afford another £9m outflow. Online sales were miserable, too. Still, Retail gross margins during H2 were the highest since 2011 and new board members may well help the moribund management. This value investment still requires inordinate patience… and I continue to hold. 

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Mincon: Subdued Q4 Hidden In Satisfactory 2015 Results

10 March 2016
By Maynard Paton

Quick update on Mincon (MCON).

Event: Preliminary results for the year to December 2015 published 9 March

Summary: A satisfactory set of results from this specialist drill manufacturer. Sadly the bumper Q3 reported in November was followed by a more subdued Q4, so I’ve had to trim my valuation estimates a little. Nonetheless, the shares do not appear outlandishly valued and I’m hopeful the stronger second-half bodes well for 2016. The books are still cash rich and management has started to improve cash flow, although the dividend remains at a standstill. I continue to hold.

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Tristel: These Results Were A Letdown And I Have Been Selling

24 February 2016
By Maynard Paton

Quick update on Tristel (TSTL).

Event: Interim results published 24 February

Summary: Oh dear — these results were something of a letdown :-( It seems TSTL’s projections of c%15 revenue growth have been dropped as UK turnover starts to stall. At least now we know why December’s AGM statement never mentioned sales! A startling £1m share-based payment and a signal for a pedestrian 5% dividend lift were other features I did not expect. Though I still hold TSTL, I have been selling during recent weeks and sold more today.

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Rotork: The Dividend Has Soared 2,688-Fold In 45 Years

10 February 2016
By Maynard Paton

Today I’m continuing my hunt for Watch List shares with a look at Rotork (ROR).

Here are the initial attractions that prompted this research:

* Majestic financial history: The accounts exhibit at least 45 years of rising earnings and dividends, plus lucrative operating margins and super returns on equity

* Culture of long-term, stable leadership: The company has been led by only four different bosses since its 1957 formation

* Interesting valuation: The shares have dropped 50% from their peak and the group’s sizeable exposure to the troubled oil and gas industry could lead to further short-term weakness

As usual, I’m applying a question-and-answer template to help me pinpoint companies that match the criteria set out in How I Invest. I’m looking for as many Yes answers as possible.

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Aveva: Super Margins, Substantial Cash And Significant Exposure To Oil And Gas

02 February 2016
By Maynard Paton

Today I’m continuing my hunt for Watch List shares with a look at Aveva (AVV).

Here are the initial attractions that prompted this research:

* Wonderful accounts: The books showcase long-term growth, super margins and substantial net cash

* Proven and loyal leader: The company has been run by the same boss since the end of 1999

* Significant exposure to oil and gas: The troubled oil and gas industry represents 35-40% of revenue and recent interim results revealed lower earnings. Further weak trading could perhaps create a buying opportunity.

As usual, I’m applying a question-and-answer template to help me pinpoint companies that match the criteria set out in How I Invest. I’m looking for as many Yes answers as possible.

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AB Dynamics: A Test Share For My Watch List

26 January 2016
By Maynard Paton

Today I’m continuing my hunt for Watch List shares with a look at AB Dynamics (ABDP).

Here are the initial attractions that prompted this research:

* Leader in a niche market: ABDP claims to be the “recognised leader in the supply of autonomous driving robots for vehicle testing”

* Attractive recent growth: Annual revenue has multiplied 6-fold in the last five years, producing high margins and robust returns on equity

* Veteran management: The company founder remains in charge today and continues to boast a substantial shareholding

As usual, I’m applying a question-and-answer template to help me pinpoint companies that match the criteria set out in How I Invest. I’m looking for as many Yes answers as possible.

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Renishaw: Measuring Up Well For My Watch List

20 January 2016
By Maynard Paton

Today I’m continuing my hunt for Watch List shares with a look at Renishaw (RSW).

Here are the initial attractions that prompted this research:

* Respectable track record: The accounts showcase a long-term record of growth, and are bolstered by high margins and net cash

* Seasoned management: The company founders remain in charge today and continue to boast substantial shareholdings

* Interesting valuation: The shares have dropped 40% from their peak and sizeable exposure to China could lead to further short-term weakness

As usual, I’m applying a question-and-answer template to help me pinpoint companies that match the criteria set out in How I Invest. I’m looking for as many Yes answers as possible.

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City Of London Investment: 7% Yield Buoyed By Greater Prospect Of New Client Money

12 January 2016
By Maynard Paton

Quick update on City of London Investment (CLIG).

Event: First-half trading statement published 12 January

Summary: Not a bad statement, given CLIG is an emerging-market fund manager and its markets have slumped since the summer. A particular bright spot was the group’s forward guidance, which for 2016/17 is factoring in an acceleration of new client money. However, I continue to value the shares on today’s funds under management — which suggest the 24p per share dividend and 7% yield remain safe for now. I continue to hold.   

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Record: Another Mandate Loss But Stronger Dollar Sustains P/E Of 8 

07 January 2016
By Maynard Paton

Quick update on Record (REC).

Event: Business Update published 07 January

Summary: Not a great start to 2016 — REC has admitted a significant mandate win from last year has now been ‘suspended’. Despite a more accommodating environment for the specialist currency manager, this update just adds to the disappointing client losses of late . Funnily enough, a stronger dollar appears to sustain my earnings guess even after today’s client withdrawal. Meanwhile, the shares do not look expensive on a possible P/E of 8. I continue to hold.

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