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  • 10 Nov 17

Most popular equity research this week | 6 - 10 Nov

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Companies: SEEFOGWRLNETAVOND4T4SSYIDOXIGPIOMKCOMSDMTEPUNGIQENAUTKBTAMOLRMEOGMAIALTSRTTRAKNASAPHDBOTBZOOARTAPPCHURVIPRCNQXTKWSONEVTAXIOGCYANPMGCITYQTX7DIGIMTKFEVRTPOPSPECTPRTHMCHARSIMTAPWANDSTR932MMXDTC
  • 09 Nov 17

The Joy of Techs

This quarter we use finnCap’s Slide Rule to provide both top-down and bottom-up analysis of the UK’s Technology and Telecoms sectors. Our findings are very reassuring: the Tech sector scores the best (across all sectors) when considering Growth and Quality – Taptica*, Frontier Developments* and dotDigital* in particular stand out on these metrics. Given these attractive characteristics and growth prospects, the Tech sector is unsurprisingly one of the most expensive – currently trading at 17.2x FY1 EV/EBIT and 23.8x FY1 P/E, versus 15.0x and 18.5x respectively for the wider market. Despite valuations appearing high, we believe there are value opportunities. For example, Proactis* features in finnCap’s QVGM+ portfolio (ranked 17/462) – the company offers attractive organic and inorganic growth, with earnings forecast to grow by 26% CAGR over the next two years, but despite this, only trades on 15x FY1 earnings and offers 8% FCF yield in FY2.

Companies: 7DIG ALT AMO ARTA BOTB BLTG CTP CITY D4T4 DTC DOTD ELCO ESG FDEV GBG IDEA IDOX IMTK IGP IOM KBT KCOM KWS LRM MAI MMX NASA NET PHD QTX QXT RCN 932 SSY SEE SIM SPE SRT STR TAP TAX TEP TPOP TRAK UNG VIP ZOO CYAN ONEV

  • 01 Nov 17

Morning Note

Lok’nStore* (LOK): Expanding the pipeline (CORP) | Revolution Bars (RBG): Revised forecasts (BUY) | OptiBiotix* (OPTI): SlimBiome supply agreement (CORP) | Velocity Composites (VEL): Strong H2 uplift delivers trading in line (CORP) | Lombard Risk Management* (LRM): Challenger bank selects AgileREPORTER (CORP)

Companies: LOK RBG OPTI VEL LRM

  • 01 Nov 17

Small Cap Breakfast

Ten Lifestyle Hldgs. Technology-enabled lifestyle and travel platform providing trusted concierge services to the world's wealthy. Net revenue increased from £20 million in the year ended 31 August 2015 to £33 million in the year ended 31 August 2017, a compound annual growth rate of 29%. Offer and date TBA. AfriTin Mining—Demerger from Bushveld Minerals (BMN.L). Offer TBA. Due 6 Nov. The Uis Tin project (Namibia) is considered the flagship tin asset within the portfolio, as this was once the largest open cast tine mine of its kind in the world . Footasylum Ltd—UK-based fashion retailer focusing on the branded footwear and apparel markets announced its intention to seek admission to AIM. Expected value between £130m and £150m. Due Nov 2017. Central Asia Metals (CAML) -RTO of Lynx Resources. Anticipated market capitalisation at Admission: £404.8m. Raising £113m at 230p. Acquiring the SASA zinc-lead mine in Macedonia from Solway Industries. Due 15 Dec. OnTheMarket—Intention to float on AIM to raise c.£50m which will be used to fund the growth of the OnTheMarket.com portal, already the third biggest UK residential property portal provider. Expected valuation £200m to £250m. Orogen plc, to be renamed Sosandar plc on Admission. Sosandar is an online womenswear brand specifically targeted at a generation of women who have graduated from younger online and high street brands, and are looking for affordable clothing with a premium, trend-led aesthetic. Offer to raise £5.3m with market cap of £16.1m, expected 2 November 2017 OG Graphite, brownfield development-stage graphite company focused on the reactivation of its wholly-owned Kearney natural flake graphite mine and mill located 280 km north of Toronto, Canada. Offer TBA, expected mid November .

Companies: MERC EME RQIH SOLG LRM AEG BEG

  • 25 Oct 17

H1 sees collateral damage but FY affirmed

H1 was surprisingly challenging for the collateral management business, but management has sufficient visibility and confidence in the pipeline to reaffirm guidance for the company’s FY growth and profit expectations. A poor six months hampered by a fall in service revenue and contract delays does leave a mountain to climb in the second half, but the company feels it has sufficient momentum given the £9.2m contracted orderbook and record pipeline to achieve a demanding target. It is important that the operational accomplishments over the last 18 months are not lost in the gloom of an underperforming half: sales have moved up to a different level since 2016; operations are now truly global with growing success in Asia; a new development centre has been set up; and a partnership has been formed with Oracle. Given the board’s obvious confidence and the record pipeline, we leave our FY expectations and target price unchanged.

Companies: Lombard Risk Management
  • 25 Oct 17

Tough H1, but primed for a record H2

Predicting the exact moment when large contracts land is never easy, but made doubly difficult if customer purchasing decisions are impacted by outside forces. This has been the case for LRM in the first half, as several chunky orders have been pushed to the right ahead of new MiFID II rules being introduced on 3 Jan’18. Not least, one significant collateral deal, worth £3.25m in license fees alone, which is now anticipated to be signed in late Q3, or early Q4.

Companies: Lombard Risk Management
  • 29 Sep 17

Most popular equity research this week | 25 - 29 Sept

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Companies: CONNDSCVBOOTRNWHCMSLOKLRMCLLSTAFSXXULVRWYGUTWEVRHSVCAPRSMPURPVANLWATRPPHTAPBOOFCRM
  • 18 Sep 17

Morning Note

Stride Gaming (STR): Changing pace (BUY) | Lombard Risk Management* (LRM): Strategic alliance with Euroclear (CORP) | Wentworth Resources (WRL): Payments received (BUY) | Petra Diamonds (PDL): Annual results (BUY) | Amino Technologies* (AMO): German contract win (CORP) | MP Evans (MPE): Excellent interim results (BUY)

Companies: STR LRM WRL PDL AMO MPE

  • 27 Jul 17

Morning Note

InnovaDerma* (IDP): Sun’s out (CORP) | Savannah Resources* (SAV): Portuguese lithium exploration update (CORP) | Keywords Studios (KWS): Pedal to the metal (BUY) | Lombard Risk Management* (LRM): A Smart move by Lombard Risk (CORP)

Companies: IDP SAV KWS LRM

  • 19 Jul 17

Positive market and encouraging pipeline

After such an outstanding close to FY17, it was almost inevitable that Q1’18 was going to be somewhat quieter for new license orders. This happens most years (see below) as the pipeline is naturally replenished following a strong Q4. Typically leading to a 35%- 45% vs 65%-55% revenue split across H1:H2. We suspect FY18 will be no different, albeit perhaps pitched towards the bottom of the range.

Companies: Lombard Risk Management
  • 25 May 17

Lombard delivers on promised growth

The new management team has more than delivered in the first of the two year plan to transform LRM into a profitable and cash generative, leading-edge software supplier to the global financial services industry. That plan is predicated on the belief that development costs were not too high for the size of business, but rather the business was too small for the proper investment required to develop regulatory and compliance solutions for Tier-1 banks. Funds raised last summer are being utilised to step up sales to a more sustainable level, and this will allow the operational gearing of a software business to deliver profit and cash. In this first year we have seen revenues and earnings beat even upgraded expectations, and the £7.0m year-end net cash position is impressive after excellent H2 cash generation. The share price has responded but has a long way to go, and we increase our target price to 18.75p in line with the progress on delivery.

Companies: Lombard Risk Management
  • 24 May 17

Record order book, sales and top line growth

‘You ain’t seen nothing yet’ was a phrase famously coined by US President Ronald Reagan back in 1984. 33 years on, it could equally apply to today’s hugely impressive FY17 prelims from Lombard Risk

Companies: Lombard Risk Management
  • 24 May 17

Morning Note

Abzena (ABZA): TNT009 bought by Bioverativ for $400m (BUY) | Europa Oil & Gas* (EOG): Placing and open offer (CORP) | STM* (STM): A strong base with optionality (CORP) | Trakm8* (TRAK): Telematics contract win underpins FY 2018 (CORP) | Lombard Risk Management* (LRM): Lombard delivers the promised growth (CORP) | Mortgage Advice Bureau (MAB1): In-line trading update (HOLD) | Ideagen* (IGP): New hires demonstrating the sales focus (CORP)

Companies: ABZA EOG STM TRAK LRM MAB1 IGP

  • 21 Apr 17

Most popular equity research this week | 17-21 April

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Companies: SDXACSOTRILRMGATCGMDPEL
  • 19 Apr 17

44% organic growth plus £7m of net cash

Many bank executives often complain about the reams of financial red-tape coming out of Brussels, London and New York. Not so Lombard Risk, which this morning delivered what can only be described as a ‘phenomenal’ set of results – reporting FY17 turnover, EBITDA and net cash all substantially above our estimates at £34.0m-£34.4m (vs ED at £31.8m), £2.4m-£2.8m (-£0.4m) and £7.0m (£1.4m) respectively.

Companies: Lombard Risk Management

Research, Charts & Company Announcements

Research Tree provides access to ongoing research coverage, media content and regulatory news on Lombard Risk Management. We currently have 69 research reports from 6 professional analysts.

Open
12.8p
Volume
0.1m
Range Today
12.8/12.8p
52 Week
5.50/15.3p
Market Cap
£50.9m
Enterprise Value
£50.9m
Pension Liability
£0m
# Shares
0m
Latest PE (hist)
0.00
Div Yield

Latest News/RNS

(more news)
Date Source Announcement
23Feb18 12:15 RNS Exercise of Options
23Feb18 09:58 RNS Scheme of arrangement becomes effective
23Feb18 07:30 RNS Suspension - Lombard Risk Management plc
23Feb18 07:19 RNS Cancellation of Shares from trading on AIM
22Feb18 12:05 RNS Court sanction of the scheme of arrangement
16Feb18 14:56 RNS Results of Court Meeting and General Meeting
02Feb18 15:23 RNS PDMR Shareholding
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  • 10 Jul 18

AIM Market – A game of two halves?

In January, we highlighted the progress that AIM had made in H2 2017. We now review the performance in H1 2018. The latest AIM Statistics published on Friday showed that there are currently 944 companies, with 38 new issues so far in 2018, raising £781m and secondary issues raising a further £2.4bn. However, with 51 companies cancelling their listing there was a net fall in H1 2018 of 13 companies. That said, new listings appear to have accelerated recently. In Share News & Views, we comment on Braemar*, Cohort, Cropper*, GetBusy*, IG Design, Lakehouse* Porvair and Wynnstay Group.

Companies: AOR APC BMS CRPR DMTR ECSC ESC EUSP FDM GETB PCF SNX TCN W7L

  • 17 Jul 18

Cenkos: CloudCall Group Plc - Calling an unchanged market opportunity

The rapid +31% YoY revenue growth delivered in H1E did not include any meaningful contribution from the recently expanded sales headcount. Indeed, this growth rate would have been higher and in line with our forecast of +36% had new hires impacted in a timely manner. While we reduce our forecasts for 2018E in relation to this softness, we continue to expect an exit run rate this year strong enough to support an unchanged 2019E.

Companies: Cloudcall Group
  • 17 Jul 18

Half time scorecard: Q2 to the rescue

With the first half of 2018 behind us, we evaluate the performance of the tech sector versus the broader market, and peers across the pond to see how the London listed technology universe compares to its bigger and better known US counterparts. We examine if the UK listed tech sector is overvalued on a relative basis. No tech sector review can be complete without analysing the performance of the big eight mega tech companies who had a strong H1 period and currently have an aggregate market capitalisation of US$5.18tn, marginally bigger than the Japanese economy.

Companies: APC ECSC EUSP FDM GETB LSAI SNX

  • 02 Jul 18

H1 Review

Best Ideas - 2018 H1 Review

Companies: SAA VP/ GLE AMO IOM HSP CVSG EKF PGIT VRP RLM AVG SOG DNLM SFR YU/ CBP

  • 16 Jul 18

Strategic acquisition of KeyDrive transforms quality of earnings

CentralNic is acquiring KeyDrive S.A. (an existing strategic partner since 2017) for an initial enterprise value of $44.5m or c.£33.6m, with an additional earnout of up to $10.5m or c.£7.9m implying a maximum Enterprise Value of $55.0m or c.£41.5m. Founded in 1998, KeyDrive has established itself as one of the leading European companies for the distribution and management of domain names, administering over 6.0m domains via its internally developed software platform for over 1,700 retailers and 40,000 direct customers across 160 countries. The largest division of KeyDrive is its reseller platform RRPproxy, which is one of the top two providers globally with a range of blue chip customers.

Companies: Centralnic Group
  • 05 Jul 18

Cenkos: Seeing Machines Ltd - New US Fleet (Guardian) Contract

Seeing Machines, the advanced computer vision technology company that designs AI-powered operator monitoring systems to improve transport safety, has signed a five-year contract with US based John Christner Trucking to install Guardian across its fleet of 850 trucks. John Christner Trucking is a family owned business based in Sapulpa, Oklahoma and one of the leading refrigeration carriers across North America. This contract follows several other recent notable North American fleet contracts including Megabus (Coach USA), Royal Foods and Bison Transport Inc.

Companies: Seeing Machines
  • 14 Aug 17

Ticking along nicely

Prelims to June are in line with expectations, with sales and adj. net income up 8% and 24% respectively. Cash conversion was also typically robust at 181% (FCF/adj. PAT), resulting in year-end net cash of £2.6m. We leave FY18 forecasts essentially unchanged – suggesting top-line growth of 9% and, in combination with continuing margin expansion, EPS +13%. Maiden FY19 forecasts reflect a continuation of this theme and form the basis of our valuation methodology and as such, we increase our target to 85p – equivalent to an undemanding 8% FY19E FCF yield.

Companies: Arcontech Group
  • 17 Jul 18

Strong H1’18; rebasing FY’18 on timing

CloudCall’s performance during H1’18 was strong but slightly weaker than our expected run-rate on slower recruitment of personnel to its growing sales team. Our FY18E estimates have been cut on the mismatch between rising costs due to continued investment in growth and the lag to achieve top-line performance, but our price target remains intact. We highlight the impact is localised to FY18E and the group’s product, sales and marketing teams are now in place to support rapid commercialisation. We continue to see substantial upside potential to our PT of 300p, particularly given the shares’ recent weakness, and reiterate our Buy rating.

Companies: Cloudcall Group
  • 02 Jul 18

Positive dynamics expected to continue

ZOO Digital released robust FY2018 results today delivering $28.6m of revenue in FY2018, 2% ahead of our forecast, and representing a 73% Y/Y increase. FY2018 saw the Group solidify its reputation as a significant player in the localisation market with the launch of innovative technologies such as ZOOdubs. The outlook for the market and the group remains buoyant with the board confident the Group is ‘just entering an exciting period’. We reflect that in our newly published FY2020E forecasts.

Companies: Zoo Digital Group
  • 06 Jul 18

Green signal – Initiation of coverage

Tracsis is a SaaS provider to the transport industry, focused on delivering shareholder value through a combination of organic and acquired growth. The business has established, well-regarded management; dominant positions in its current domestic markets; significant overseas opportunities for growth; and a strong M&A track record delivering additions to the product set and cross sales to the loyal customer base, as well as penetration of international markets. With the opportunity for unmodelled growth through acquisitions enabled by its £18.5m net cash position (generated internally), and the chance to deliver automation and improved margins within Traffic and Data Services (FY17: 54% of group revenue but only 24% of group EBITDA), we initiate coverage with a 700p target price.

Companies: Tracsis
  • 17 Jul 18

Ideagen - Low risk in delivering compliance

Prelims confirm EBITDA of £11.0m from revenue of £36.1m, in line with expectations unchanged at the May trading update. 11% underlying organic revenue growth is supported by acquisitions (current and prior periods), delivering +33% group revenue, +40% group EBITDA, and +33% adjusted diluted EPS. Net cash at period end of £0.8m is expected to be boosted by strong and growing free cash flow, funding both the dividend and the inevitable further acquisitions. Ideagen has a tried and tested formula for delivery of forecasts and sensible acquisitions, and we look forward to continuing positive newsflow as the relentless increase in regulatory compliance leads to the requirement for efficiencies and insight through automation, which Ideagen’s solutions deliver – and Brexit will only increase. We roll out a new target of 140p (120p) based on FY20 forecasts for further organic growth of +10% EBITDA and EPS; however, we fully expect further acquisitions to increase those forecasts in the interim.

Companies: Ideagen
  • 02 Jul 18

Hooray for Hollywood

After upgrades during the year, ZOO has delivered EBITDA of $2.4m ($2.3mE) from revenue of $28.6m ($28.0mE), demonstrating impressive growth rates of 35% and 73% respectively, including 149% growth in Localisation revenue (subtitling and dubbing). Localisation services, elements of the suite of ZOO’s broader cloud-based platform, deliver the ability for content providers to commercialise their content in more languages and territories at a pace and cost which outperform any alternatives. Matching client demand, the clients being both the largest and best known in Hollywood as well as the household name online platforms, the company continues to invest in overseas partnerships of ‘talent’ to deliver further languages and capacity in addition to the 5,000 strong ZOO network. The group delivers momentum from playing to the video media zeitgeist of enabling content delivery over any device, anytime, anywhere – fulfilling the practicality of rolling out a film in 30 languages to 50 territories at the same time, rather than the former practical limit of the typical maximum 10 languages. We nudge up FY19 forecasts (revenue 5%, EBITDA 2%) and introduce FY20 forecasts with 19% revenue and EBITDA growth: continuing revenue momentum alongside further investment and a healthy balance sheet. Twelve-month target price lifted to 130p (116p).

Companies: Zoo Digital Group
  • 05 Jul 18

A ‘match made in heaven’

M&A is a bit like ‘panning for gold’. Most prospectors lose money, but the successful ones do the homework, know where to look and crucially understand their markets inside out. Similarly, we think Elecosoft - following its ‘transformational’ £2.4m acquisition of BIM (Building Information Modelling) SaaS provider, ICON back in October 2016 - has done it again.

Companies: Elecosoft
  • 11 Jul 18

FY19 set up for much better year

Long term Blancco shareholders are undoubtedly a hardy bunch. An essential trait given the difficulties (some self-inflicted) the company has endured over the past 2 years. The good news is that the bleeding now seems to have stopped, with real progress being made under the new leadership team.

Companies: Blancco Technology Group
  • 24 May 18

Strong performance from quality – 11 focus stocks

We have refreshed our quality style screen for the second time and report on style performance since the last refresh in October. Performance has been very strong, outperforming the small-cap index by c.1600bps (weighted basis) and c.1000bps (unweighted). There has been volatility with the market and this style has yet to be tested in a concerted down market, but in a flat or rising market quality appears to be a successful investment style in small-caps. We have highlighted 11 focus stocks in the new screen and will report back again on performance when we next refresh the screen in about 5-6 months’ time.

Companies: LIO GHT AMO CHH ZYT DOTD GTLY RIV FCRM TAM PAM