Small Cap Catch-Up: Steel, Safety And Bowling

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Small Cap Catch-Up: Steel, Safety And Bowling

Billington Holdings (LON:BILN) – Just Look At Them Go! 

The quality of this supplier to the construction industry, of structural steel products and safety solutions, continues to shine through. 

In early May this year the shares of the £58.8m capitalised group were trading up at 476.20p, since when they have been down to a low of 282.50p, that was in late October. 

In the middle of November, the company issued its Trading Update stating very clearly that its strong trading performance had continued across the group. 

Furthermore, it boasted that results for the year to the end of this month are now expected to be ahead of previous market expectations. 

CEO Mark Smith stated that: 

“Going forward into 2024 we have a healthy pipeline of further opportunities, however, we do remain mindful of continuing inflationary pressures and an uncertain macroeconomic outlook, but with our strong balance sheet I do believe the group is well positioned for the future.” 

Understandably the group’s equity has subsequently witnessed a strong turnaround in value. 

Analyst David Buxton at Cavendish Capital noted that the update confirmed strong margin progress and market momentum, supported by the group’s balance sheet strength.   

He is looking for the 2023 year to show £125.0m (£86.6m) revenues, while adjusted pre-tax profits could increase to £13.3m (£5.8m), taking earnings up to a massive 83.9p (39.1p), which would easily cover a 20.0p (15.5p) dividend per share. 

Buxton has a Price Objective of 541p out on the shares. 

Last night they closed up 2.25%, some 10p better on the day at 457p. 

Despite the 60% rise over the last month, I feel that holders should sit tight for even further good news. 

(Profile 02.04.19 @ 266p set a Target Price of 314.5p*) 

(Profile 13.06.22 @ 217.5p set a Target Price of 295p*) 

Time Finance (LON:TIME) – Still Time To Take Advantage 

Yesterday’s Trading Update from this alternative finance provider showed an excellent performance for the first half to end November. 

It reported that the company had seen its tenth consecutive quarter of growth in its lending book, while at the same time pushing up both its revenues and its profits. 

CEO Ed Rimmer stated that: 

“The Board and I are very encouraged by performance in the first half of the current financial year.  

In line with our strategy, we have continued to increase the size of our lending book and, crucially, have done so without compromising on quality, as borne out by the stable nature of our arrears.  

This approach has led to increased revenues and profitability.  

We now have real confidence that the group is very well placed to continue on this growth trajectory, building long-term value for our shareholders.” 

Analyst estimates are for the full year to end May 2024 to report £30.8m (£27.6m) revenues, with £5.7m (£4.4m) of adjusted pre-tax profits and earnings of 4.6p (3.7p) per share. 

For 2025 they look for £33.1m revenues, £6.7m profits and 5.4p earnings. 

The Interim Results will be released on Thursday 25th January, by which time I could see the shares easily breaking above the 40p level and then heading higher. 

They closed last night around 4.25% down on the day at 34.95p, after easing to 34.00p on profit-taking. 

Time to take advantage! 

(Profile 23.12.20 @ 21.5p set a Target Price of 30p*) 

(Profile 07.01.22 @ 23.5p set a Target Price of 30p*) 

Hollywood Bowl Group (LON:BOWL) – Berenberg Increase Price Objective To 410p 

Following Monday’s Final Results announcement from this £499m valued ten-pin bowling centre operator, analyst Jack Cummings at Berenberg upped his Price Objective on the group’s shares to 410p. 

His Buy advice noted the company’s strong full-year update, with double-digit revenue and profit growth despite headwinds.  

He commented that the group, which is the biggest player in both the UK and the Canadian markets, was well positioned with a best-in-class management team, a strong balance sheet and a long runway for growth – with the ability to expand to at least 130 centres in the UK and Canada by 2035. 

The group’s shares closed last night at 290p. 

(Profile 14.11.19 @ 240p set a Target Price of 300p*) 

Global Ports Holding (LON:GPH) – Really Cruising Now 

The world’s largest independent cruise port operating group yesterday reported its Interim Results to end September. 

They recorded a 54% increase in passenger flow to 6.7m (4.4m), while adjusted revenues were 50% up at $95.9m ($64.1m), with underlying profits some 64% better at $7.6m ($4.6m). 

Chairman and CEO Mehmet Kutman stated that: 

“Our business continues to reach new highs, delivering record Adjusted Revenue and Adjusted EBITDA for the six-month reporting period.  

Demand for cruising remains exceptionally strong and our call reservations for calendar year 2024, are supportive of further significant growth in the business. 

Our consolidated and management ports are expected to welcome close to 14m passengers in the 12 months to 31 March 2025, with passenger volumes rising to exceed 16m once San Juan Cruise Port and St Lucia Cruise Port join the network.  

This will take our annual total passenger volume across all ports in the GPH cruise port network, including equity accounted ports, to close to 20m.” 

Analyst Greg Johnson at Shore Capital Markets believes that the group is set fair to further capitalise on this highly attractive industry. 

His estimates for the current year to end March 2024 are for $158.6m ($117.4m) in revenues and adjusted pre-tax profits of $18.9m ($3.0m), helping to turn the group around from an earnings deficit of 21.0c into an adjusted 11.8c worth of earnings per share. 

Johnson could well be looking to upgrade his prospective year estimates early next year. 

The £177.6m capitalised group’s shares, which peaked at 290p just over a month ago, closed last night at only 255p, unchanged on the day. 

These shares could respond well to a global upsurge in cruise bookings in early 2024. 

(Profile 11.11.22 @ 81.5p set a Target Price of 100p*) 

(Asterisks * denote that Target Prices have been achieved since Profile publication) 

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