Evil Diaries: Different expressions of intangibility

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Evil Diaries: Different expressions of intangibility

I bought a little Coro (CORO) a few years ago and, as the price declined from around 2p to 0.32p I put it down to experience. Here it is capitalised at c. £7m. I then alighted upon a note recently offered by Align Research of whom I had never previously heard. Align stands by its opinion from two years ago that the price should attain 1.5p.

Certainly junior oil stocks have generally been very disappointing in 2021 and I contemplated whether Align might be on to something. So I looked at the balance sheet and noted its paucity, particularly that stated NAV is virtually nil and that that figure assumes that intangibles are correctly considered recoverable at a valuation of £18m. This is quite an assumption. But I bought a few and we’ll see.

Elsewhere, My correspondent, Robert Corden, drew my attention on the run up to Christmas to Shearwater Group (SWG). Here NAV is roughly double the current share price of 110p and intangibles (presumably these have arisen through acquisitions) are in at around 200p+. According to Robert EPS is increasing quite rapidly and on that basis SWG is cheap. I hope so. There is plenty of cash.


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