See what was trending this week...
Companies: ABZA, BVXP, CTH, FSJPF, MTFB, OPTI, PLUS, RTHM, 0RYA, SDXEF, STR, TEF
Featured Report:
Rude Health
Abzena, AKERS BIOSCIENCES INC, Allergy Therapeutics, Alliance Pharma, Avacta, Bioventix, Byotrol, Cambridge Cognition Holdings, Caretech Holdings, Lidco, Motif Bio, Omega Diagnostics, OptiBiotix Health, Premaitha Health, Proteome Sciences, Scientific Digital Imaging, Tristel,
“Sell in May and go away” – this certainly does not apply to a number of companies, for which significant data points and milestones are expected to occur over the next few months. We highlight the following: Alliance Pharma (APH) – UK approval of Diclectin for Nausea and Vomiting of Pregnancy; Abzena (ABZA) – Phase II/III readout for two Abzena Inside antibodies; Avacta (AVCT) – multiple data points during Q3; ANGLE (AGL) – headline data for Parsortix in ovarian cancer; and, perhaps most significant, the Phase III readout from Motif Bio's (MTFB) REVIVE-2 study for iclaprim, which we expect to be positive and lead to the company filing with the FDA in 2017.... read more
Very strong trading update, buyback launched
Plus500 (PLUS) | Liberum, 2 June
Gold Access
"Today's trading update indicates that the positive momentum seen in Q1 continued into Q2, suggesting risk to consensus forecasts is strongly to the upside. So far there has been no impact to business from the proposed regulatory changes in Plus's markets..."
Consistent execution
RhythmOne (RTHM) | N+1 Singer, 30 May
Gold Access
"Good execution has driven a huge profit turnaround. A $10.5m EBITDA for FY16 became a profit of $3.9m in H2’FY17. The business is now simpler after exiting all non-core activity and focusing on areas of market growth with a high quality integrated offering and strong technology platform. International expansion was successfully launched during the year. There are 15 markets operating and delivering 10% of core programmatic revenues. The quality and scale of the offering makes the Company a compelling partner and this has led to a boost in new partners and publishers. With the existing business having moved into profit, International expansion working very well and the Perk acquisition set to contribute in FY18, the Company looks set to deliver a substantial leap in EBITDA (we forecast $15.2m) and generate material cash. The Company is confident about trading trends and we see it as just a matter of time before another scale/product orientated deal. The stock is responding to execution and has risen 19.1% since we initiated with BUY. We lift our TP to 70p, maintain our BUY and flag the stock continues to warrant a place in our Best Ideas portfolio..."
Ryanair Holdings (RYA) | Panmure Gordon, 31 May
Gold Access
"Intra-Europe traffic growth of MSD% p.a. looks well grounded, and Ryanair is in a (probably the) leading position to capitalise on increasing commoditisation of the short-haul market as the industry consolidates. We now model €1bn p.a. share buybacks, increasing FY18/19 EPS by 4/12%, and raise our TP to €20. BUY..."
Strongly resilient and now loaded with international and connected spirit
Ryanair Holdings (RYA) | AlphaValue, 31 May
Gold Access
"Ryanair surprised once again by its strong ability for resilience even in a difficult environment (specifically following the Brexit vote) when average fares strongly declined (-13%). It confirmed its capacity to reduce even further its operating costs (though low oil prices helped quite a lot) while increasing its load factor to an industry leading 94% and its number of passenger to 120m, while it expects 130m for next year. Capacity is not expected to grow quickly enough for Ryanair as it is looking for additional aircraft deliveries in the next 24 months with Boeing. This enables the Irish airline to look at other airlines’ market shares, like that of Alitalia or Air Berlin which might need to cease operating on some routes. Finally, partnerships that it aims to sign with low-cost long-haul airlines should establish even more its European leading market share (15%)..."
Confirmation of significant discovery
SDX ENERGY INC (SDX) | Edison, 31 May
Free Access
"SDX Energy has announced the initial results of the testing at the SD-1X gas discovery in the South Disouq licence where it has a 55% operated working interest. The initial test produced a flow rate of dry gas of 25.8 mmcf/day which was ahead of management expectations of approximately 15 mmcf/day. This flow rate was limited by the surface equipment. The well has now been shut in for initial build up and then will be flow tested at several additional flow rates and fluid samples taken in order to gather data to allow the management to proceed with a development plan..."
Robust growth in real money gaming
Stride Gaming (STR) | Edison, 30 May
Free Access
"Stride Gaming’s H117 pro forma net gaming revenues (NGR) grew 21% to £44.0m, driven by strong organic growth in the real money gaming (RMG) vertical. In a continuation of previous trends, the social gaming vertical has weakened, with a 24% decline in revenues to £4.7m, and Stride has recognised a £10.2m impairment on its InfiApps assets. However, the core RMG business is gaining market share, trading has been robust in Q317 and management has reiterated its FY17 outlook. Our headline FY17 revenue and EBITDA figures remain unchanged. Stride trades at 7.5x calendar 2017e EV/EBITDA, a meaningful discount to its peers..."
Telford Homes (TEF) | Equity Development, 31 May
Free Access
"Telford Homes has published another positive set of full year results with record revenues and profits. The company has a large development pipeline, it enjoys excellent visibility through its forward order book and the balance sheet is robust. We expect continued growth over the next three years..."
Fastjet (FJET) | Equity Development, 1 June
Free Access
"Investing in airlines has always been a hazardous game, given the industry’s notoriously poor record of capital allocation, cyclicality and exposure to geopolitics, terrorism and the oil price. The former contributing towards the eye-watering bankruptcies at Sir Freddie Laker’s SkyTrain and PanAm back in the 1980/90s, in addition to US, Northwest and American airlines post 2000. Worse still, carriers are today right in the cross-hairs when things go wrong, as demonstrated by British Airways’ public relations fiasco at Heathrow and Gatwick last weekend. Nonetheless, real improvements are being made, with stronger management forcing through capital discipline and more flexible cost structures, alongside greater demand from emerging market tourists, who are increasingly opting to travel abroad..."
