Zotefoams (LON:ZTF) – Bouncing Ahead
The morning of Tuesday 19th March will be when this Croydon-based group, a world leader in cellular materials technology, will be reporting its 2023 Final Results being announced.
In mid-January this year in its Trading Update, its CEO David Stirling stated that:
“We are delighted to close the year with sales in line with market expectations and record profits ahead of market expectations.
The Group has recovered and stabilised margins in its polyolefin foams business and continued to grow sales from its higher margin high-performance products.
Overall, Zotefoams has a clear strategy with a growing range of products, an increasingly global footprint and strong ESG credentials, meaning it is well positioned to deliver further profitable growth.”
Analyst Caroline de La Soujeole at Singer Capital Markets rates the group’s shares as a Buy, looking for 480p in due course.
She estimates that the year to end December 2023 saw revenues treading water at £127.5m (£127.4m) with adjusted pre-tax profits steady at £12.5m (£12.5m), while earnings dipped to 19.2p (20.7p) but with the dividend expected to be increased to 7.10p (6.80p) per share.
For the current year she has £141.7m for sales, £14.8m profits, 22.5p earnings and 7.46p dividend per share.
Going forward for 2025 she looks for £148.6m revenues and a big jump to £19.4m in profits and 29.4p earnings, with a 7.90p dividend per share.
The team of analysts at Peel Hunt – Lauren Baker Iguaz, Henry Carver and Harry Philips, also rate the shares as a Buy, but with a Price Objective of just 420p.
The brokers look for last year’s profits of £13.1m, 19.8p earnings and a dividend of 7.1p per share.
For 2024 they see £136m sales, £15.0m profits, 22.7p earnings and a 7.5p dividend, while for 2025 they have £150m, £18.7m, 28.3p and 7.9p respectively.
Having been as low as 277p last October, the group’s shares, which hit 399p at the end of January, closed last night at around 330p capitalising it at £161m.
They now look ready for a price bounce within the next few weeks as investors start to realise that its technology advances will really boost its profits over the next couple of years.
I now set a new Target Price of 395p on the group’s shares.
(Profile 26.06.19 @ 600p set a Target Price of 750p)
(Profile 06.03.24 @ 330p set a new Target Price of 395p)
Renold (LON:RNO) – Keeping ‘Chained Up’
Noting that the Employee Benefit Trust for this chain and transmission equipment group had increased its holding in the group’s equity from 11.26% to 12.13%, reminded me that we should soon be getting another Trading Update from the company.
The Interim Results last November were very positive, highlighting that the six months to end September last year reported strategic and operational progress driving the group’s record earnings growth.
Analyst David Buxton at Cavendish Capital Markets is expecting the business to show, in the year to end March, a slight drop in sales to £244.3m (£247.1m) but with a slight increase in adjusted pre-tax profits at £19.2m (£18.6m), lifting earnings up to 6.0p (5.9p) per share.
Buxton has a Price Objective of 58p on the group’s shares, which closed last night at only 39.5p, capitalising the globally operating group at just over £86.7m.
The shares continue to be lowly rated.
(Profile 04.06.19 @ 30p set a Target Price of 60p)
(Profile 08.11.23 @ 29p set a Target Price of 36p*)
Volution Group (LON:FAN) – A Cool Stock
In the last year the shares of this Crawley-based but global-selling ventilation products business have been up to 456p and down to as low as 328p.
Last night they closed at 412p valuing the company at £822m.
At the end of next week (Friday 15th) the energy efficient indoor air quality solutions group, renowned for its Vent Axia products, will be reporting its Interim Results to end January this year.
The AGM Trading Update last December declared that the group had made a strong start to the year, with added momentum from its three most recent acquisitions – giving hopes of beating market expectations.
Analyst Charlie Campbell at Liberum Capital rates the shares as a Buy looking for 470p a share in due course.
His estimates for the end July 2024 and 2025 years suggest sales of £352m (2023: £328m) then up to £367m, with pre-tax profits of £68.5m (£65.1m) then £73.4m, lifting earnings up from 25.8p in 2023 to £26.5m this year and £28.2m in 2025, with the dividend rising gradually from 8.0p in 2023 to 8.3p, then8.5p per share.
Campbell clearly states that he feels that the market is starting to appreciate Volution’s qualities and its differentiators against the UK building materials sector.
The group’s shares remain a Strong Hold.
(Profile 23.05.19 @ 174p set a Target Price of 250p*)
(Profile 03.03.23 @ 348p set a Target Price of 400p*)
(Profile 19.07.23 @ 361.20p set a Target Price of 450p*)
Windward (LON:WNWD) – Good Set Of Results Due Shortly
I am looking forward to reading the Final Results statement from this near £100m valued Israel-based group on Wednesday 27th March.
The group is a leading Maritime AI company which provides an all-in-one platform to accelerate global trade.
Its clients range from oil supermajors, freight forwarders, and port authorities, to banks, shippers, insurers, and governmental organisations.
The company’s artificial intelligence-powered decision support and exception management platform offers users a 360° view of the maritime ecosystem.
It enables stakeholders to make real time, predictive intelligence-driven decisions to achieve business and operational readiness.
The group has recently pulled off some notable deals with both INTERPOL and the LSEG
The trio of analysts at Canaccord Genuity – Kai Korschelt, Hyley Palmer and Minal Patel – rate the group’s shares as a Buy, looking for 135p in due course.
Their estimates for the last year to end December are for sales to have risen from $21.6m to $28.3m, while more than halving its adjusted pre-tax loss from $16.4m to just $6.1m.
For the current year their previous estimates, which will no doubt be upgraded later this month, looked for $34.5m sales and a loss of only $2.6m.
I reckon that next year, to end 2025, should see the company breaking even, possibly turning into profit.
The shares, which were up to 125p each in the third week of February this year, are currently trading at around the 108.5p level – at which patient investors should be making sure that they have medium-term open positions.
(Profile 03.04.23 @ 37.5p set a Target Price of 47p*)
(Profile 13.12.23 @ 80p set a Target Price of 100p*)
Vertu Motors (LON:VTU) – Is Cinch Going For A Clinch?
Ahead of its preliminary results for the year ended 29th February 2024 to be announced on 15th May, this leading UK motor retailing group updated its investors on the five-month period to 31 January 2024.
It noted that used car prices had stabilised; that the new vehicle market was looking somewhat uncertain; but that its aftersales had been proving robust; whilst encouragingly the group had a strong year-end cash position.
That is all good news for its recently adding, and biggest shareholder, Cinch – now with some 30.6m shares representing 9.043% of the group’s equity.
Vertu Motors shares are now around 67p, valuing the group at about £226m.
(Profile 12.10.20 @ 30.5p set a Target Price of 40p*)
(Profile 03.07.23 @ 71p set a target Price of 80p*)
(Profile 17.01.24 @ 70.5p set a Target Price of 87p)
Team Internet Group (LON:TIG) – Running Out Of Buyback Cash?
Is the company itself the only real buyer in town?
As it comes to the end of its major £34m Share Buyback programme, with its aim to buy up to a maximum 28.87m of its group shares, it yesterday declared the purchase of another 57,503 shares for £77,280, taking its total now in Treasury up to 27.81m (9.63%).
Its end December 2023 year’s final results will be announced on Mondays 18th March, so it would be pleasing to see some good news coming from the global internet services provider.
The group enjoys a very high ARR, which as regular subscribers will already know is one of my favoured criteria, which must have helped the group obtain its financing.
But to borrow to buyback shares is something that I find hard to accept.
I have not had the time to work out just how much the company will have spent in the last year or so buying back its stock, nor too to work out the average purchase price.
Recently the daily purchases have started to decline in size and value – I just hope that is not how the group’s shares will perform going forward.
For such a ‘money machine’ its shares have been something of a damp squib of late, with, as I asked earlier, the best buyer of its equity being its own ‘borrowed money’ Treasury.
As I stated above – I really do look forward to the group coming up with some constructive and positive news in its Outlook statement.
The shares closed last night at 133p.
(Profile 12.07.21 @ 89p set a Target Price of 110p*)
(Profile 17.04.23 @ 123p set a Target Price of 150p)
(Profile 17.01.24 @ 124.60p set a Target Price of 156p)
Braemar (LON:BMS) – Hoping For A Bullish Update Shortly
I was impressed by the comment on Clarkson’s results on Monday morning, especially those that noted that the world’s leading provider of integrated shipping services, a much bigger version of Braemar, that it had posted another set of record results, despite all the disruptions to shipping faced throughout the last year.
I hope that similar is reported by my favourite shipping services group, the world’s second largest, when it announces its Pre-Close Update later this month.
Currently its shares at just 268p appear friendless, which is an unneeded low rating that I am sure will be soon left behind.
(Profile 05.12.19 @ 185p set a Target Price of 250p*)
(Profile 20.05.20 @ 99p set a Target Price of 150p*)
(Asterisks * denote that Target Prices have been achieved since Profile publication)
I hope that you are attending The 2024 Master Investor Show this coming Saturday at the Business Design Centre in Islington.
If you are then I would be delighted to meet you and have a chat about the Small Cap sector – please don’t hesitate to do so, it would be good to get your feedback.