Futura, Avation, Team Internet And Gulf Marine – All Looking Perky
Futura Medical (LON: FUM) – End 2024 US Launch Getting Ever Closer
Did you know that Erectile Dysfunction impacts 1 in 5 men globally across all adult age brackets, with about half of all men over 40 experiencing ED and 25% of all new diagnoses being in men under 40?
Americans must be looking forward to getting perked up because this developer of innovative sexual health products will see its clinically proven lead product Eroxon, being marketed in the US before the end of this year.
It has been developed for the treatment of Erectile Dysfunction and is the only topical gel treatment for ED available over the counter and it helps men to get an erection in ten minutes.
The group has distribution partners in place in a number of major consumer markets including with Haleon in the US, which is considered to be the largest market for ED in the world.
It also has Cooper Consumer Health as its partner in the European market.
Last week the company also confirmed that trading had remained in line with current market expectations for FY2024.
Importantly those estimates do not include any contribution from the US launch in FY2024.
The company will be giving an updated guidance on its trading when it declares its Interim results in September.
Analyst Seb Jantet at Panmure Liberum has a Buy note out on the group, looking for its shares to rise to 131p in due course.
He was encouraged by the recent AGM Statement and has estimates for sales to more than treble in the current year to end December to £10m (£3m), helping to more than halve its pre-tax losses to £2.1m against a loss of £6.9m last year.
The turnaround is due next year, with Jantet going for £18m sales, pushing the developing group into a useful £2.6m profit, worth 0.9p per share in earnings.
Jumping forward to 2026 the analyst points to the possibility of £24m sales, taking pre-tax profits up to £4.1m, worth 1.4p per share in earnings.
Analysts Lala Gregorek and Philippa Gardner at Trinity Delta Lighthouse consider that the market for ED treatments is significant and that Eroxon appears ideally placed to carve a sizeable niche for itself.
Their assumptions suggest that 123p a share is a conservative valuation.
Based on such estimates, I maintain my confidence in Futura to perform.
Its shares are currently trading at only 34p.
I now set a new Target Price of 50p, looking for the shares to start moving up again well before the year-end.
(Profile 14.03.19 @ 15p setting no Target Price)
(Profile 22.12.21 @ 34.5p setting a Target Price of 50p*)
(Profile 05.08.24 @ 34p setting a Target Price of 50p)
Avation (LON:AVAP) – ‘Fair Value’ Of Shares Double Current Price
It will not be too long to wait for the next positive Corporate Update to be issued by this commercial passenger aircraft leasing company.
At the end of May, in the Pre-Close Trading Update, Chairman Jeff Chatfield stated that:
“The Company is at a transition point in terms of improving shareholder returns alongside cash flow generation and growth.
We are confident of improving returns to shareholders by carefully optimising the mix of sources of finance available to the Company and are finding asset backed financiers to be extremely constructive.”
Towards the end of next month the group should be declaring its finals to end June.
Current estimates suggest that revenues will be steady at $90.3m ($91.9m), while adjusted pre-tax profits could leap to $45.0m ($21.8m), raising 57.6c (0.3c) in earnings per share.
Following the Farnborough Air Show, last week the group announced that it had placed the first of its 10 ATR 72-600 new generation turboprop planes to a new airline customer, the Japanese start-up airline JCAS Airways.
Analyst Damian Brewer, at Canaccord Genuity Capital Markets, rates the group’s shares as a Buy, looking for 280p.
While John Cummins and Charlie Cullen, analysts at Zeus Capital, have a ‘fair value’ of 250p for the group’s shares, compared to the current 127.5p, which values the group at only £90m – too cheap.
(Profile 03.06.24 @ 142p set a Target Price of 175p)
Team Internet (LON:TIG) – Interims Due Next Week Could Further Identify Under Rating Of Shares
Next Monday, 12th August, this £500m capitalised global internet services group will declare its half-time results for the six months to end-June.
They should be good enough to keep the shares trotting higher in price.
They have been up above the 200p level in the last few trading days, having touched 207.50p at one stage last Thursday, before drifting back to 200p.
Despite the slower advertising market depressing its Online Marketing returns, market analysts are still expecting that the year to end-December will show a significant increase in full-year revenues to $960m ($837m), with adjusted EBITDA of $107.60m, taking earnings up to about 28c per share, plus paying a 2.2p dividend.
For the coming year, some $1,050m revenue could see about $116.20m of EBITDA, worth 30c a share in earnings and easily covering a 2.5p dividend.
In 2026, some estimates already suggest close to $1.1bn of revenues, with EBITDA of $130.5m, earnings of 36.5c and a dividend of 2.6p per share.
For such a long time I have been boring readers with my description of this business as being a ‘money machine’ – well looking at those analyst views continues to confirm my theory.
On 22nd May, when the shares were around 180p, I noted that
“With the current momentum I would suggest that 200p really is not that far away now.”
That occurred within days.
The recent share price strength has been set against a much heavier dealing turnover, with volumes over 1.1m shares for two days running, late last week.
The increased activity could well be in advance of the group’s forthcoming Results and Trading Statement.
I continue to like this stock and suggest that, unless there is bad news, the shares are not for selling, instead they are for buying on any price dips.
(Profile 17.04.23 @ 123p set a Target Price of 150p*)
(Profile 18.01.24 @ 124.60p set a Target Price of 156p*)
Gulf Marine Services (LON:GMS) – Confirmed Guidance And $300m Refinancing, Shares Could Pick Up Another 50%
On Thursday of last week this company, which is a leading provider of self-propelled and self-elevating support vessels for the offshore oil, gas, and renewables sectors, announced that it had agreed a new $300m refinancing deal with its three bankers – First Abu Dhabi Bank, Commercial Bank of Dubai and HSBC Bank.
It also announced that its Board had approved a dividend policy dedicating 20%-30% of annual adjusted net profit towards distributions to shareholders, in the forms of dividends and potentially share buyback, provided all bank covenants are met and other plans permit.
At the same time, the company confirmed its EBITDA guidance for the year to end December in the range of $92m to $100m, while stating that it is working on revisiting its EBITDA guidance for 2025 towards year-end.
At the beginning of August its backlog stood at $414.5m.
Chairman Mansour Al Alami stated that:
“This is yet another testimony of the progress achieved by GMS in the past couple of years.
It signals a new dawn for us and the start of a new journey.
It acknowledges our recent years track record and will enable us to achieve our long term objectives on growth and on shareholders rewards, without jeopardizing our commitment to deleveraging.”
Analyst Daniel Slater at Zeus Capital values the group’s shares at 28p each.
His estimates for the current year to end-December suggest sales revenues of $167.7m ($151.6m), with adjusted pre-tax profits quadrupled to $52.0m ($13.1m), lifting earnings to 4.1c (0.9c) per share.
For 2025, his view is that $175.1m sales will push adjusted pre-tax profits up to $60.0m, worth 4.8c per share in earnings.
At Panmure Liberum, analysts Andy Smith and Ashley Kelty rate the shares as a Buy, with a Price Objective of 28p.
Their view is that the favourable macro-outlook and improved visibility will see GMS heading into 2H 2024 and beyond in its strongest position for years.
Capitalised at just £191m, the group’s shares, at only 17.85p, look really quite appealing.
(Profile 30.11.23 @ 13p set a Target Price of 16p*)
(Profile 22.01.24 @ 15.95p set a Target Price of 19.50p*)
(Asterisks * denote that Target Prices have been achieved since Profile publication)
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