Small Cap Catch-Up: Well, They Did It!

Journeo (LON:JNEO) – Shares Hit 243p

On Wednesday of this week the shares of my favourite transport connectivity technology systems group more than surpassed my recent aim of actually doubling my Target Price of 120p*.

They hit 243.60p following on from Tuesday mornings very positive Interim Results announcement.

The figures showed that in the six months to end June the group reported revenues up 146% to £21.8m (£8.9m), while underlying pre-tax profits were 277% better at £2.5m (£0.7m), lifting earnings up to 9.03p (1.92p) per share.

At the end of June, it had an order book of £27m, which was a record, while it also has a sales pipeline of some £55m.

The recently announced acquisition of the Denmark-based MultiQ business will provide a very useful springboard for the group selling into the Nordic region.

Analyst Andrew Renton at Cavendish Capital, who has a Price Objective of 338p on the shares, is estimating £41.7m (21.1m) revenues for the year to end December, looking for £3.7m (£1.0m) od adjusted pre-tax profits, sufficient to generate earnings of 19.7p (10.3p) per share.

We have had a cracking run up in the shares of late, it is now only sensible to allow for some profit-taking to slice the shares back to say 200p, before consolidating and then moving gently higher again on the back of more positive corporate news.

The shares closed last night 12p lower, down some 5% on the day at 227p.

(Profile 07.04.21 @ 95.5p set a Target Price of 120p*)

SRT Marine Systems (LON:SRT) – This One Is Getting Ready To Rise

The shares of this £95.5m valued automatic maritime domain awareness systems group saw much heavier trading in the middle of this week.

This company has a very healthy £380m Order Book pipeline upon which it is working, which inevitably will see an impressive conversion into new business.

Analysts Kimberley Carstens and Michael Hill at Cavendish Capital are very positive about the group, looking for its shares to more than double to 100p in due course.

For the current year to end March 2024 they have estimates out for revenues to improve to £70.9m (£30.5m), boosting the group into some £7.4m of adjusted pre-tax profits comparing more impressively to last year’s £0.2m loss.

They see earnings rising more than tenfold to 3.8p (0.3p) per share.

Already allowing for favourable returns from the group’s existing £160m booked contracts, the analysts see sales rising yet again to £104.8m, with £11.8m profits and 6.1p earnings per share.

As I have already clearly stated, this Bath-based group’s shares are undervalued, especially considering its advanced technology systems and its fast-growing order book.

Boss Simon Tucker believes that the group’s potential order pipeline could well expand to £1.4bn.

It is now a significant player in its global marketplace.

Its shares have yet to reflect their real value – they have recently been up to 69p, which is a level to which I believe they will very soon return and then move even higher.

They closed at only 48p last night, buy now while stocks last!

(Profile 14.09.20 @ 39p set a Target Price of 50p*)

FRP Advisory Group (LON:FRP) – Revenues Show 18% CAGR

Restructuring, corporate financing, debt advisory, forensic analysis, together with financial advisory services – that is what this group is all about.

Yesterday’s AGM Statement noted that trading in the year-to-date had been positive and if current activity levels continue, the Board is confident that the group will at least deliver the current full year market expectations. 

The company believes that consensus market expectations for FY 2024, including a full second half year contribution from the recently acquired Wilson Field Group, to be revenue of £111.8m and with adjusted EBITDA of £28.7m.

The short and medium-term outlook for the group remains positive and the Board is confident of continued progress.

We should look forward to the next trading update for the six months to 31 October 2023 to be announced in mid-November 2023.

Chairman Nigel Guy stated that:

“During the last financial year to 30 April 2023, we continued to execute our strategy.

We maintained our track record of increasing revenues, profits and dividends while further investing in our business.

Since our IPO in 2020, we have generated annual growth (CAGR) in revenue of +18%, adjusted EBITDA of +13% and dividends of +5%.”

Cavendish Capital analyst Peter Renton has a Price Objective of 165p on the group’s shares, compared with last night’s closing level of 117p.

In late November last year, they touched 173p, but that is some way to trace back, which may take a while.

However, to spin back up to the 136p reached in late June is more than possible short-term.

(Profile 15.02.21 @ 104p set a Target Price at 130p*)

Some Share Stake Changes….

Iofina (LON:IOF) – Private Investors Stake Building

David and Monique Newlands have been building up their holding in the iodine specialist, now 15.56m shares some 7.47% of the equity.

The recently announced record Interim Results to end June showed a 27% increase in half-way revenues to $24.3m ($19.2m), while pre-tax profits were 80% better at $4.7m ($2.6m).

Analysts Alex Brooks and Salvatore Verdoliva at Canaccord Genuity rate the shares as a Buy looking for 40p against the current 28.5p.

Hold tight.

(Profile 29.07.20 @ 13.5p set a Target Price at 18p*)

Costain (LON:COST) – Chairman Doubles Stake At 59.2p A Share

Thinking of share stake builds – I did notice that Chairman Kate Rock recently doubled her holding in the infrastructure group, paying 59.2p a share to do so.

Analyst Joe Brent at Liberum Capital has a Buy out on the group’s shares, with a 80p Price Objective.

He is looking for a 20% leap in profits in 2023 to £41m, worth 11.30p per share in earnings.

They closed last night at 57.25p, valuing the group at £164.1m.

(Profile 24.08.23 @ 50p set a Target Price of 62p)

Transense Technologies (LON:TRT) – Dowgate Wealth Adds To Holding

Following the recently announced finals to end June, it was interesting to note that Dowgate Wealth has yet again added to its holding in this specialist sensor systems group.

DW now holds 5.58% of the £17.05m capitalised group’s equity, some 865,300 shares, which closed last night 5% better at 110p.

(Profile 17.09.21 @ 102p set a Target Price at 127.5p)

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