Morning Brief – 12-Jan-2018

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Morning Brief Images 12-Jan-2018

Morning All!

Tarsus (TRS) – 334p – £377.8m – PER 18.5

Trading Update For The 12 Months To End December 2017 – In-line and the outlook for 2018 is positive “our portfolio is strong”.

Still looks OK (good Operating Margin and ROCE) but does have Net Debt of £84m (20%+ of Mkt Cap). I will remain Neutral for now.

Nanoco (NANO) – 27.5p – £78.6m – PER n/a

AGM Statement – If this is all they have to say at the AGM I wouldn’t bother turning up even for the free canapes and vino.

Stockopedia still classes this as a “Speculative Sucker Stock”. I will leave it to those with that kind of investment bias. Also looks like it may well need some more Cash soon.

Somero Enterprises (SOM) – 342.51p – £192.6m – PER 13.6

Trading Update For The 12 Months To End December 2017 – The Board now expects 2017 revenues will be slightly ahead of market expectations of $84.7m, EBITDA will be comfortably ahead of market expectations of $26.0m. Net Cash expected to be not less than $18.5m, well ahead of market expectations of $16.5m (intends to maintain a $15m Net Cash position). Lower US Corporate Tax, seems to be uncertainty of the benefit (or not) at present. Outlook, confident of another year of profitable growth.

I already hold here and intend to continue to do so for now. I am a little nervous though that the recent update was not clearer on the US Tax change (as a lot of revenue is from the US).

SDL (SDL) – 430p – £353.8m – PER 16.5

Trading Update For The 12 Months To End December 2017 – Doesn’t exactly look rosy. Warned some deals may not be closed in December and they’re STILL working on closing them.

Fundamentals here still don’t look too bad but I still reckon there’s problems here.

Quartix Holdings (QTX) – 359p – £170.8m – PER 26.8

Trading Update For The 12 Months To End December 2017 – Revenue to be slightly ahead of market expectations, Profit expected to be moderately ahead. Look forward to 2018 with confidence.

Even slightly ahead results make this tricky for me to consider paying up for. I note 2016, 2017, 2018 (forecast) Revenue and Profit numbers are basically flat, EPS not much different. I just can’t pay a PER of 26.8 for this kind of “growth”.

A great weekend to all!

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