Education Development Share Discussion Threads

[interceptor2] 26/11/2009 10:09

And still very much a Zulu stock, even after this years dramatic rise. I can see Jim Slater being content to keep holding with figures shown below.

2010 PEG is 0.6 with 18.4% growth, and 2011 PEG is 0.55 with 17.13% growth. These are very solid forecast earning, with upgrades likely over the next 12 months.

[bookworm1] 25/11/2009 13:13

interceptor I agree with your comment in 675. The PBIT of £9.9m allows for some leeway. Looking at last years results although the sales growth fell short of the previous year the operating margin incresed dramatically and they managed to keep a very tight lid on admin costs and good control of the working capital. Allowing for increased expenditure in the comming year the company is probably going for a sales target of £35m+ but I calculate that they should still be able to deliver the PBIT target even if sales fall short by £5m to say £30m.

This next year will all be about increasing market share in the UK. They have the staff in place and they are further investing in improving their systems and capacity. Lets see what the interims look like and maybe then we will be closer to your price target of 200p.

[interceptor2] 25/11/2009 09:45

News today of share options awarded to directors.



I believe it shows confidence that they are linked to performance of the higher adjusted EPS figure of 16.2p, with a target of + 6% + rpi

[interceptor2] 25/11/2009 09:36

Evolution updated EDD buy forcasts yesterday as follows.

2010 PBIT = £9.9m and EPS = 12.5p
2011 PBIT = £11.8m and EPS = 14.9p

Even though these forecast are looking more realistic now, I'm still expecting more upgrades as the year progresses, I know we cant expect anything as dramatic as last year, but confident of continuing steady growth.

[stegrego] 24/11/2009 22:30

Hoodless B

Education Development International (EDD, 140p, £80.7m) the provider of accredited qualifications and assessment services announced FY results to 30 September. Revenue increased by 32% to £28.3m (2008: £21.5m), adjusted EBIT of £8.6m (£3.3m). adjusted EPS of 16.2p (6.2p) strongly ahead of market estimate of around 11p (assuming that was on a clean basis). Strong cash generation of £8.5m (2008: £4.5m) led to year end net cash of £9.5m (£3.2m) and a total dividend of 1.6p (0.42p), a 1.1% yield. The performance reflects the successful integration of acquisitions and diversification of product offering. EDI continued strong growth in sales of vocational qualifications and assessment in the UK, which increased by 50%, reflecting increased government spending but mainly market share gains. International sales rose 29%, (10% like-for-like excluding currency gains) led by South East Asian and German markets. On the surface the rating looks reasonable to full but current estimates should rise. For example the company is trading at only 8.6x this year's actual adjusted EPS. With a strong performance and further growth in the pipeline we reiterate our BUY recommendation and raise our price target to 180p.

[bookworm1] 24/11/2009 16:11

Thanks for that penpoint at this rate they might even open up as a bank!

At least the Brewin Dolphin forecasts are starting to look more realistic.

[penpont] 24/11/2009 15:24

From write up in IC today:

EDI has transformed its business thanks to the successful integration of seven acquisitions. Having spent 18 months without completing a deal, and with plenty of cash in its coffers, investors can expect further activity next year, possibly in publishing, software or psychometrics. Over the next couple of years EDI also plans to invest £2m in its core Campus administration platform which should allow it to scale up significantly without spending much more. Utilising historic tax losses helped boost EPS last year, but EDI should pay a normal tax charge in the current financial year.



'Brewin Dolphin forecasts 2010 pre-tax profits of £9.9m and EPS of 12.5p (2009: £8.6m/11.4p) and expects the cash pile to have risen to in excess of £20m by September 2011.'

[bookworm1] 24/11/2009 10:50

Headline figures are bang on target and the cash balance is even better than I thought it would be. Well done Nigel and all the team!

[dasv] 24/11/2009 10:47

yep - excellent.

[chester] 24/11/2009 07:58

Agree. Looks very good.

[interceptor2] 24/11/2009 07:39

Only a chance for a quick read through before I must go out for the day, but they look like excellent results this morning with a very positive tone going forward.

Final dividend increase 300% to 1.2p, and net cash increased to £9.5m from £3.2m, shows the strength and confidence of the BOD.

[interceptor2] 23/11/2009 15:20

I did see David Cameron give a speech to the CBI earlier today, and he did make a strong commitment that vocational education and training would be a priority. Unfotunately it's too early to find a transcript online yet, or I would post it. But it was re-assuring.

Looking forward to results tomorrow, and as you say next year broker forecast are cautious at the moment. So the tone of tomorrows statement will be important, which hopefully will see some updated forecast.

[bookworm1] 23/11/2009 14:15

If we can meet market expectations then we are in for a 77% increase in eps and according to my estimates around £6m in the bank. That should get a bit of attention from the city boys. Seems to tie in with current share price being 12 x eps.

Plus a trebling of the dividend...

However I guess the real question is where is it going to go over the next year. Brokers forecasts are quite cautious with 5% growth next year due to possible concerns about what will happen if we get a change in government. But pre-close trading statement had the following statement:

"Both main political parties are indicating their strong commitment to good quality vocational education and training."

[johnthespacer] 20/11/2009 14:17

holding my breath now results out on tuesday!

[bookworm1] 12/11/2009 09:56

Article in todays FT
mandelson plans 'technician class'

[chester] 10/11/2009 09:17

Nicely timed melody.

[melody9999] 04/11/2009 00:09

should start to attract some interest from here - especially with finals due 24/11 I think. I added before at 120p and this looks a good entry again to me.

[bookworm1] 28/10/2009 10:17

In my experience broker forecasts beyond the current year for high growth companies are always very prudent. Presumably in case the company falls short of its current year forecast. Only when the results are out do they seem to address the next years forecast. Which means if you follow the Jim Slater approach now is a great time to be getting into EDD!

[interceptor2] 27/10/2009 18:19

Agreed that next years forecast will be more interesting, I'm surprised at how conservative the broker forecast have been for 2010. Back in April the eps forecast was showing negative growth of - 11%, at least they agree on positive growth now at approximately 4%.

[bookworm1] 27/10/2009 15:12

Interceptor have just checked my notes and prior to the recent broker forecast I had 11.2p as a forecast eps. So I suspect the 'market expectations' have been revised slightly up already. If we get 11.5p I'll be happy but of more interest now will be the estimates of what the next year will bring. I thought Nigel was quite smart to nip any speculation in the bud by announcing that Diplomas were getting cross party support as that was my only concern. Onwards and upwards.

[interceptor2] 25/10/2009 19:52

Only 4 weeks to results.

I found the wording of last trading statement very interesting " Board expects results will at least meet market expectations" this implies to me that the results are likely to exceed market expectations.

I looked back at broker forecast before previous results to see by how much the consensus eps forecast was exceeded. 2007 broker forecast were 3.45p and results were 4.1p +20%. 2008 forecasts were 5.8p and results were 6.1p +5%.

2009 broker forecast are for 11.5p adding a modest 8% would give eps of 12.42p.

Lets hope for a good run upto results over the next 4 weeks.

[interceptor2] 16/10/2009 12:36

Agree todays move confirms a new break out, which peaked at 138p before.

[chester] 16/10/2009 12:32

Breakout guys.

[dasv] 14/10/2009 15:06

I'have had a look at BGBL and you could be right about it potentially bagging, but I can't make my mind up with no real guidance on the financial details of the deals they've been doing. I.e. it's jam tomorrow - that doesn't stop it being a bad share - just not one whose business I understand.