Most popular equity research this week | 10-14 July

AIM – End of summer term report

Stockdale, 12 July
Gold Access

Braemar | James Cropper | ECSC | EU Supply | FDM | Private & Commercial Finance | ProPhotonix | Quarto | Synectics | Sprue Aegis | SQS Software Quality Systems | Tricorn | Warpaint

"We update this table which we first published in early January and highlight the continued progress of the biggest AIM companies so far this year and activity in general. The latest AIM Statistics show that there are 963 companies currently, with 28 new issues year to date raising £441m. What’s more, this momentum has been maintained since June. This demonstrates that despite, the uncertainty surrounding the UK economy, generally investors continue to be active in the AIM market. In Share News & Views we comment on Cohort, ECSC*, Porvair, Quarto*, SQS* and Xafinity."

Looking Forward on the markets H2 2017

Hybridan | 12 July
Gold Access

Innovaderma | Petards | Amryt Pharma | Sound Energy | EVR | Touchstar | Van Elle | Warpaint | Gear4music

"The AIM market turned twenty-two in June, and it is fair to say it has had its fair share of difficultiesH1 2017 saw a further net loss of constituents, and we ask what will the rest of 2017 hold in store. Arguably the stability of the UK government, Brexit and the shift in global monetary policy will be the biggest themes for the remainder of the year."

Amino Technologies (AMO)

Strong H1 2017 delivery | Progressive Equity Research, 11 July
Free Access

"Amino has reported H1 17A results ahead of management’s expectations, and a closing net cash position (£13.1m) confirmed as having more than doubled over FY 16A. Key metrics saw impressive growth, with turnover and adjusted EBITDA up 21% and 70% respectively. IP device sales were strong, particularly in the Americas. In software, the group continues to report positive momentum. We leave earnings estimates unchanged at this stage and believe the maintained progressive dividend policy (+10% y/y) continues to demonstrate management’s confidence in the outlook."

7Digital Group (7DIG)

Stand and deliver | Edison, 10 July
Free Access

"7digital is a leading provider of turnkey solutions that enable businesses to offer digital music services to their customers. It has made significant strategic progress over the last year, culminating in the acquisition of its largest European competitor, 24-7, which adds £18m of secured revenues over three years and synergy potential. We believe it is well placed to benefit from the evolution in the market for music streaming and forecast profitability from FY18; the shares look extremely attractive at these levels."

Accrol Group (ACRL)

Building a robust platform | Equity Development, 11 July
Free Access

"FY17 results, broadly as forecast, capped a strong first year since IPO. Accrol held gross margins in a challenging market. It was helped by a strong position as a key supplier to UK Discounters – and grew its share from 35% to 50% - well-timed currency hedges and a lean operational model which gives it access to materially better raw material prices than its competition."

Stadium Group (SDM)

Trading in line; order book increasing | N+1 Singer, 10 July
Gold Access

"Stadium has released a positive and encouraging update, confirming that the Group remains on track to achieve forecasts which imply 26% growth in PBT. In addition, the order book has again grown strongly which supports the ongoing growth story. The shares have recovered somewhat in recent months but remain inexpensive, in our view, at a P/E of only 12.5x FY17 earnings, falling to 10.3x FY18. We look forward to further detail with the Interim Results in September."

DX Group (DX.)

Industrial Transportation | Zeus Capital, 14 July
Gold Access

"We note the RNS this morning, and advise we are suspending our forecasts (previously updated on 31 March 2017) from the market given the changes to the outlook for the business during a period when the shares remain suspended following the announcement of the transaction."

Falanx Group (FLX)

Turnaround gathers momentum | Whitman Howard, 10 July
Gold Access

"The FY17 prelims and a recent trip to Falanx’s new Birmingham Security Operations Centre (SOC) emphasises the changes it has implemented over the last 12 months. Two acquisitions, an increase in the range of services provided, a stronger management team, the release of new software and in relation to the SOC itself, a 20% reduction in fixed costs, yet a tripling in capacity will allow Falanx to move from a period of restructuring to growth. With cyber security high on the agenda for many organisations, we reiterate our buy recommendation and increase the price target from 9p to 11p to reflect the increasing momentum."

Gateley (GTLY)

FY17 results | Arden Partners, 11 July
Gold Access

"FY17 results highlight strong organic growth momentum (+12.6%) as core markets continue to perform well supported by lateral hires. We believe these results are testimony to the success of the strategy to move from LLP to a plc with the group’s profile and ability to attract new fee earners enhanced by the non-traditional approach to corporate structure for a UK law firm. Deal flow has held up well to date with good activity levels in core areas such as corporate, finance and property markets. Whilst the shares have been pushing new highs, we retain our positive stance given clear evidence of strong organic growth delivery and an opportunity-rich corporate landscape that should provide for further earnings enhancement in due course."

Blancco Technology Group (BLTG)

Pre close update | Panmure Gordon, 10 July
Gold Access

"Blancco has delivered a mixed pre-close update. For the 12 months to Jun-17 revenues were in-line with expectations (PG £31.9m, +42%), up approximately 40%. However, adjusted EBIT is behind expectations, mainly due to an impairment of the working capital. In addition, since certain receivables have not been paid, the year-end net cash is lower than expected (£1.5m vs forecast of £3.0m). Overall, not good news and investors have rightly shown their concern. That said, many of the factors/risks were known."