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07 Oct 19

LIBERUM: Ramsdens Holdings* - Positive trading update and an exceptional profit

Trading has been in line with the board's expectations, despite what is referred to as a challenging retail environment. The stores recently acquired from The Money Shop are said to be trading well, and acquisitions are still being appraised.

Companies: Ramsdens

07 Oct 19

Cenkos: Duke Royalty Ltd - Larger scale, more diversified and rising DPS!

Duke is raising £16.1-20.0m (gross) in new equity to enlarge and balance out its portfolio of royalty partners. The placing also unlocks new debt finance for investing, such that Duke could have 16+ royalty partners funded by £131-141m of invested capital, producing royalty income of c£17m+ pa. This income will be met with a stabilised cost base from FY20E, producing significant operating leverage, more material FCF and with it DPS increases for this top 5% yielding AIM stock

Companies: Duke Royalty

10 Oct 19

IQE - Optimising Asian operations

IQE has acquired the third-party shareholdings in its CSDC joint venture in Singapore for a nominal fee. This gives it control of the operation, which is currently loss making, enabling it to restructure the business and focus it on emerging sales opportunities in Asia for molecular beam epitaxy (MBE)-based products. Short term, the deal has a negative impact on earnings. We reduce our FY19 and FY20 EPS estimates by 8% and 5%, respectively.

Companies: IQE

07 Oct 19

UK Housebuilding Sector in 3Q 2019: ‘And then there were 17’

Dame Agatha Christie (née Miller) published more than 80 books and plays; and the Guinness Book of World Records lists her as the best-selling novelist of all time with roughly two billion copies sold. ‘And then there were none’ was originally published in 1939, with an un-politically correct title; and it is still the world’s best-selling mystery (with more than 100 million sold). It is also number six on the list of best-selling books of all-time.

Companies: ABBY CSP WJG TW/ BWY PSN GLV BDEV RDW BKG BVS GFRD CRN GLE SPR

10 Oct 19

Strong earnings support transformation

Morses Club’s result for the six months to 31 August confirmed the group’s strong position to both build on its strength in the Home Collect Credit (HCC) market and ultimately benefit from the changes in customer behaviour by broadening the product range and acquiring further HCC loan books. The results showed strong progress in the digital offering, with close to 14% of HCC customers now signed up for the customer portal launched earlier this year, but also indicated that the level of investment needed to follow the changes in customer behaviour is significant, and will have a near-term negative impact on profitability. The level of investment needed in the industry is, however, also likely to result in more acquisition opportunities as other HCC lenders are unable to make the needed investment. We retain our 190p target price.

Companies: Morses Club

11 Oct 19

SAP founder/CEO steps down, Boeing partners with Porsche, Ford launches in-car VR

Bill McDermott stood down on Friday after a decade building up SAP as the world's leading enterprise software company, handing the task of completing its transition to cloud computing to new co-CEOs Jennifer Morgan and Christian Klein. SAP announced the management overhaul, with immediate effect, after rushing out third-quarter results that showed it gaining traction in its drive to offer a more streamlined range of services and boost profitability. The company’s stock has climbed 21% this year. It’s up 75% in the past five years, topping rival Oracle, which is up 46%, and the S&P 500′s 54% gain.

Companies: EVRH TRAK CPX CALL ECK IMMO LOOP NET SEE TCM TRCS QTX VRE

10 Oct 19

XP Power - Q3 order intake encouraging

Despite a tough trading environment in Q3, XP Power saw improving order flow and a book-to-bill ratio of 1.04x for the quarter and management anticipates meeting its FY19 expectations. Helped by currency, our FY19 revenue forecast appears conservative but in the face of volatile trading conditions, we maintain our estimates.

Companies: XP Power

07 Oct 19

Treatt - Another good year despite citrus price deflation

Treatt has had another successful year: notwithstanding the decline in citrus prices, revenues were up 0.5%, or down 2% at constant currency. This demonstrates the transformation that has occurred at the company over the last few years, from a commodity trading house to a provider of value-added, technical flavour and fragrance solutions. While orange oil prices were down 50% and revenue from the citrus category was down 10%, Treatt’s broadened portfolio was able to withstand the decline by registering significant growth elsewhere, notably in tea, health & wellness and fruit & vegetables. Management’s outlook for FY20 is positive, despite citrus pricing continuing to have an adverse effect.

Companies: Treatt

09 Oct 19

Positive momentum: another £642m net inflow in Q2

Liontrust has seen another impressive quarter of net inflows, against an uncertain market backdrop of geo-political uncertainty. AuM grew by 4% with the majority of the £642m net inflow coming from the core UK Retail channel. The Neptune acquisition completed postperiod end, taking AuM to £17.4bn. We see upside as the Neptune fund range is marketed to Liontrust’s core clients. In our view, a 12x FY20e PER is undemanding for a resilient growth profile which sets it apart from peers.

Companies: Liontrust Asset Management

11 Oct 19

Positive Trading Update

Dart Group has released a positive trading update indicating booking trends have continued to strengthen, boosted by later season bookings, and that the Board believes market expectations for FY20 PBT will be exceeded. There had been indications from other market players that demand had been strengthening in the later season and this announcement suggests Jet2 has been well positioned to capture the upside. Reiterate Buy.

Companies: Dart Group

08 Oct 19

On the runway to recovery

Air partner is a leading international aviation services business. The Broking division (88% of gross profit) charters airliners for commercial, private and freight customers. The near term market backdrop is challenging but longer term prospects are positive, with passenger numbers set to double by 2037. Strength of relationships in the Broking business and a portfolio approach (no single product or market dominating) places Air Partner well to navigate short term challenges. Geographic diversification (recently opening offices in the US/Asia) offers potential for market share gains, whilst a plan to grow the Consulting & Training division (12% of gross profit) should smooth the earnings profile of the Group. We see significant recovery potential in Air Partner as the refreshed Board executes its strategy.

Companies: Air Partner

10 Oct 19

Cenkos: Falcon Oil & Gas Ltd - Drilling Commences

Yesterday, Falcon Oil & Gas announced the spudding of the Kyalla 117 N2-1 exploration well in the Beetaloo Sub-Basin, Australia. The Kyalla 117 N2-1 well is the first well in the Stage 2 drilling programme to evaluate the potential of the Kyalla shale liquids rich gas play, with Falcon and its partner, Origin Energy looking to build on the 6.6Tcf of gross 2C contingent resource already discovered within the Middle Velkerri B shale dry gas play during 2015/2016. Following the Stage 2 programme, the JV will look to achieve commercial production flow rates in the most prospective play(s) through the drilling and stimulation of two horizontal wells in 2020. With a largely carried work programme and a resource base far in excess of any of its peers we believe Falcon offers investors a low-risk, low cost entry point into an emerging world-class basin. We maintain our BUY recommendation and our 41p price target.

Companies: Falcon Oil & Gas

11 Oct 19

Retail ready for a renaissance?

There have been few structural shifts in the property sector as profound as the one currently taking place in retail. Consumer spending patterns have drastically changed over the past five years, with online sales now accounting for 19.7% of all retail spend in the UK (August 2019, source: ONS), compared to 11.5% in August 2014. When you look at fashion retailing specifically, online sales accounted for 26.8% of consumer spend on clothing in 2018 (source: Mintel).

Companies: CAPC CAL HMSO INTU NRR SHB

11 Oct 19

Retail ready for a renaissance?

Companies: CAPC CAL HMSO INTU NRR SHB

07 Oct 19

Cenkos: Angling Direct Plc - Continued Momentum

Angling continues to gain momentum in H1/20A as they report substantial growth in all areas of the business. This progress is testament to the continued growth capital invested in the business that has driven sales both in the UK and abroad. We believe Angling is on track to meet our full year forecasts as they continue to outperform the retail sector, leverage their competitive advantage and grow their geographic presence in the UK and Europe.

Companies: Angling Direct

11 Oct 19

Avacta Group - Affimer drug conjugates attracting interest

Avacta has announced a collaboration and licensing agreement with ADC Therapeutics to develop multiple Affimer drug conjugates. The conjugates will combine Avacta’s Affimers with ADC’s warhead and linker technology. The collaboration is multi-target and will aim to generate Affimer binders to three undisclosed cancer targets. ADC will be responsible for all pre-clinical research and development except for Affimer selection, which will be carried out by Avacta. The agreement includes an option on each target to gain an exclusive clinical and commercial licence. Avacta will also be eligible to receive option fees, development and commercial milestones and single-digit royalties. Additionally, ADC will cover Avacta’s costs during the collaboration. No further financial details were announced. We retain our valuation of Avacta at £51m or 44p/share.

Companies: Avacta Group

11 Oct 19

Orège - UK commercial delays affect 2019 sales

Following H1 results highlighting delays in the UK commercial development, we have reduced our forecasts to reflect our assumption of a one-year delay in the revenue ramp-up for Orège. An acceleration of revenue growth would be the main catalyst for a potential rerating.

Companies: Orege

11 Oct 19

Rainbow Rare Earths hits reset button as it moves towards more efficient operations

11 Oct 19

Daldrup & Söhne - Reshaping the business

Daldrup & Söhne (D&S) continues to implement its corporate restructuring programme and in July it sold 49% of Geysir Europe to IKAV. H119 results showed a small decline in profitability versus H18 (but an improvement versus FY18) and D&S believes the transition will continue into FY20. The executive board continues to guide for a total group output of €40m and an operational break-even for FY19. Consensus remains more optimistic than guidance and based on consensus forecasts, D&S is trading on an EV/sales multiple for FY19 of 1.2x, compared with a peer group average of 4.1x.

Companies: Daldrup & Soehne

11 Oct 19

Solo Oil: Analyst Malcolm Graham-Wood expects 'significant valuation uplift' when trading resumes

11 Oct 19

Generali, Mediobanca, Bolloré, now del Vecchio

After the recent €580m investment made by the Italian veteran entrepreneur Leonardo Del Vecchio in Mediobanca, speculation about the capital of Generali has re-surfaced. As ever, the shadow of Bolloré reappears as still the second largest shareholder of Mediobanca. This may have implications for Vivendi, Telecom Italia, and Mediaset.

Companies: Assicurazioni Generali

11 Oct 19

artec technologies - Prepped and ready to scale

After a strong FY18 with a number of reference orders, H119 was slower than anticipated. Management remains confident about FY19 (H2 should be stronger than H1 due to year-end budgetary cycles), with additional public service wins indicated in Q4. In media, with the exit of Verizon Volicon from the market management believes artec is well placed to win additional European clients. artec invested in capacity in H119 and raised c €1m of equity capital in July to target these accounts and is considering a convertible bond issue to fund M&A. If management can build on the opportunities outlined, we believe there is significant upside to the shares.

Companies: artec technologies

11 Oct 19

Retail ready for a renaissance?

Companies: CAPC CAL HMSO INTU NRR SHB

11 Oct 19

Retail ready for a renaissance?

Companies: CAPC CAL HMSO INTU NRR SHB

11 Oct 19

SP Angel . Morning View

Bezant Resources (BZT LN) 0.20p, Mkt Cap £2m – Bezant calls General Meeting to approve sale of 80% of Mankayan copper project in Philippines

Companies: Bezant Resources

11 Oct 19

Continuously rising passenger numbers but falling cargo demand

The passenger number growth has moderated somewhat in September (+2.3% to 14.0m), but the SLF continued to increase (+0.1pp to 84.7%). On the other hand, sold ton-kilometres fell by 3.6% whereas the ytd number is down by ‘only’ 1.9%.

Companies: Deutsche Lufthansa

11 Oct 19

The DRC is 'misunderstood and very much open for business'

11 Oct 19

Strong online showing leads to profit upgrade

GVC reported good Q3 19 numbers, with total NGR declining by 2%, on a cc basis. The strong performance was driven by online (11% cc with gaming up 7% and sports up 15%, which offset the weak UK retail (-18%) and European retail (-5%). Management has upgraded its FY 19 EBITDA guidance to £670-680m (from £650-670m earlier) on the back of the strong performance. Following the good numbers, we will be making minor upgrades to our estimates as well as the target price.

Companies: GVC

11 Oct 19

Below expectation, guidance downgraded

Publicis delivered a disappointing Q3 19 with organic net revenue down -2.7% (vs -0.7% in H1 19). This was attributable to the continuing attrition of traditional advertising in the US, a slowdown in media that was amplified by a tough comparative last year, and the repositioning of Sapient in the US which is taking longer than expected. Guidance was revised downwards at the topline, including organic revenue down -2.5% in 2019 and a range of -2%/+1% in 2020.

Companies: Publicis Groupe

11 Oct 19

CEO Thierry Bolloré is fired with immediate effect

The continuing frictions between Renault and Nissan after the 2018 arrest of Carlos Ghosn in Japan has produced another victim. The CEO has been fired and CFO Clotilde Delbos promoted to the helm for an interim period.

Companies: Renault