Arcontech Share Discussion Threads

[multibagger] 21/3/2017 08:24

Fully agree isa2020 - welcome on board, haven't see you here before :)

Volumes have usually been very low and liquidity poor so any buying interest moves the share price quickly. However, the share price action yesterday and today (so far), seems to be unusual...just my gut feeling, as I have been in ARC for over 3 years now.It is a steady and solid performer.

Good luck all !

[isa2020] 21/3/2017 08:17

One of few business in AIM making profit year on year with cash in bank, possibilities of dividends

[multibagger] 21/3/2017 08:14

Sudden interest and share price moving sharpish - what's going on ??

[gleach23] 20/3/2017 19:26

Yes - nice to see that move today after the 3.5 month consolidation around the 48-54p level.

Judging from the volume chart in the header, the higher volume days have become more frequent of late too.

[multibagger] 20/3/2017 19:03

Today's new share price high strongly supported by volumes is all the more interesting in the context of good share price gains over the current financial year.

As it is not far off the financial year end, one would anticipate some selling pressure as investors would want to sell and lock in capitals gains to the extent of the CGT limit.

Paradoxically, we have gone up ! ARC is not a leaky company so I find this intriguing. There was also a single 25000 shares transaction, which in ARC terms is unusual. So won't rule out some Director/PMDR buying and a RNS to follow.

All said and done, good to see quite a strong breakout from the recent trading range.

Good luck all :)

[multibagger] 20/3/2017 12:57

Great to see another new share price high on relatively small volumes. Low liquidity stock and still very undervalued IMHO - I would say that wouldn't I ;

Good luck all ! More to come !!

[gleach23] 06/3/2017 11:37

Yes, thanks again multibagger...all looking good for a rerating in the coming weeks/months.

Net cash is over 30% of current market cap too.

[taffy100] 06/3/2017 09:04

Thanks multibagger!

Great results, great prospects and well managed. Roll on the full year results!

[multibagger] 06/3/2017 08:40

Finncap (corporate) research note: 06 March 2017

Target: 70p

Arcontech Outperformance continues

Arcontech has delivered 80% of our previous FY17 adj. PBT estimate in a strong H1, driven by strong underlying sales growth of +20%. We upgrade both forecasts and target price to reflect this progress; FY17E adj. PBT moves to £0.4m (£0.3m) and our target price to 70p.

Underlying growth – when adjusting for a terminated contract that benefited 1H16 (announced Mar-15), h-o-h sales growth was an impressive c.20%, with the largest contributors being contract wins announced in September and December. Consequently, annualised recurring revenue increased from £2.0m (at the beginning of H1) to £2.3m by period-end (+15%).

Costs stable – excluding SBP and (minimal) D&A, admin costs remained at £0.9m, such that £0.2m of EBITDA was delivered at a 21% margin. We see scope for margin expansion as Arcontech continues to grow given that incremental sales are c.100% gross margin and all revenue is recurring in nature, which means only a light sales force is required.

Upgrading forecasts – FY17E sales increase from £2.1m to £2.3m and adj. PAT from £0.4m to £0.5m. We highlight that this assumes minimal new sales bookings in H2 and also a £100k h-o-h increase in opex to accommodate for an increase in S&M. Because of these prudent assumptions, we believe that risk is on the upside. We only make minor (but positive) adjustments to FY18E at this stage, such that assumed top-line growth is 9% (below the current trend) and therefore also leaves scope for outperformance.


Significant runway for growth – over the past two years Arcontech has developed a new desktop software solution, dissimilar to any of its existing products which is in proof-of-concept trials with five Tier 1 banks. Although none have signed up on commercial terms yet, the quality of these customers speaks volumes for the potential value and opportunity for this product.


Increase target price to 70p – we continue to believe that Arcontech’s current valuation does not adequately reflect the company’s qualities; excellent revenue visibility (c.100%); strong cash conversion (>100%); growth (+20%); and scope for margin expansion. Because of these qualities and earnings upgrades, we raise our target to 70p: 3x FY18E EV/Sales and 14x P/FCF.

[gleach23] 02/3/2017 08:14

Looking at the previous 2 years (26/03/15 & 06/03/14) timing of the half year report seems a little random!

Seems to have been a mini rush for the exit here in the last few days but looks to have settled on a support level for the moment.

[multibagger] 17/2/2017 20:42

If last year is anything to go by, we should get a six month trading update in the coming week. Monday the 20th Feb, would seem to be as a good a day as any !

And if, just if, we get a maiden dividend announcement in the region of 1.1 to 1.2p (given that ARC are ultra conservative), I would be delighted. Won't be then surprised for us to motor by 5-6p. A rough guess would expect the cash position to be very healthy as well and possibly in the region of £1.4m+

Roll on Monday :)

Good luck all !

[isa2020] 10/2/2017 10:41

Don't understand, what would be gained from selling 8 shares

[multibagger] 08/2/2017 08:51

Another small tick up...keep it coming guys ! :)

[multibagger] 06/2/2017 12:50

Looks like we have hit a new share price high and backed by volumes....always a strong bullish sign in my book :)

Good luck all !

[taffy100] 06/2/2017 10:19

Look better when the results are out shortly IMHO.

Tightly held share and will rocket on higher volumes. Happy days!

[gleach23] 06/2/2017 09:37

Looking good now m-b after another 5k purchase

[multibagger] 06/2/2017 08:36

Three decent sized trades since 30 Jan - about 31k in total.

Not massive but more than usual for ARC....wonder if it is in expectation of a good trading update this month ?

Good luck all :)

[gleach23] 03/2/2017 18:09

It was indeed issued in Feb last year m-b but I think it was March in the previous 2 years. Let's hope it's Feb again this year...

[multibagger] 03/2/2017 17:57

Last year we heard around the third week of Feb (If I'm not mistaken) - so not too long to wait. Hoping some dividends will be declared - I reckon in the region of 1.2 to 1.5p/share (as ARC are very conservative and it will allow excellent dividend cover) and scope for a progressive dividend policy.

Good luck all :)

[gleach23] 03/2/2017 15:47

Clearly the early 50s represent a hurdle but there have been one or two decent buys going through in recent days - bodes well in the run up to a half year report which will hopefully be issued within the next month.

[gleach23] 18/1/2017 11:33

Given a breakout is on the cards with this move I'm surprised that it's attracting the odd sale, although I guess we all have our price.

Offer now up to 53 but still only 100 available to buy online.

[multibagger] 18/1/2017 10:34

Most welcome gleach23 and glad you are benefiting - we all pick up tips from one another !

Onwards and upwards ARC :)

[gleach23] 18/1/2017 10:22

Well I have you to thank for your tip on battlebus's thread in early Dec, so thanks!

On the back of the trades today I would expect a further rise pretty soon by a few pence to take out the previous high and then may consider a trailing stop, although I'll have to think hard about that because of the illiquidity you allude to.

[multibagger] 18/1/2017 10:11

Agree gleach23....these trades are good sized by ARC standards.If a few more thousand shares are bought, we could well cross 55p. Which would be new high I imagine.

Patience pays and many on here have been buying and holding :)