Ncipher Share Discussion Threads

[cwa1] 10/4/2008 16:30

Hey, these guys are earning their salary nice and early ;-)

[rivaldo] 10/4/2008 16:28

Double yikes!!

[dr darkstar] 31/3/2008 16:59

so the dead cat bounce starts!

[cwa1] 31/3/2008 10:40

Excellent. A full page sell rec by the IC MUST be good news :-))

The market seems to be responding already to the reverse kiss of death ;-)

[nurdin] 31/3/2008 10:35

I personally think their days an an independent entity are over....will be watching for any increase in volumes before adding

[das9] 31/3/2008 10:31

Goodnight: thanks for this ray of sunshine!

Fwiw Techinvest rates NCH this w/e as 'Strong buy on a 2-3 year view'. However they could hardly fail to say something as it is one of their nap tips for 2008 at a considerably higher price!

DAS

[goodnight vienna] 29/3/2008 14:55

Nice, full page "TIP of the week" in latest IC:

[goodnight vienna] 29/3/2008 14:54

Nice, full page "TIP of the week" in latest IC:

[weatherman] 19/3/2008 18:41

A new CEO has an incentive to trash the share price by issuing a profit warning when announcing a new direction - then his Options are worth more when the company goes back to fair price. 130p to 260p would be 100% and look pretty good, but pretty rubbish really to trash it in the first place mind. He could have planned faster growth while keeping the eps healthy.

Yes I am a cynic, but seen this too many times.

Still it could be a good investment from here.

[madgooner] 19/3/2008 17:06

cloque,

have you factored in the reorganisations?

The Aribidean venture was admittedly poor, but a safe cash strong business was welll placed to benefit in uncertain times. Hope I'm wrong, but fear it is set up to be taken private..

[clogue] 19/3/2008 15:10

Tim Tom2,
The point you made in your previous post(27) was that you were happy with the previous management. In my opinion the previous management were not good for the share price and you must remember the price was down to 150p before this clown made his results statement.
Whither the new team can produce the goods remains to be seen, but lets not get dewy eyed about the last lot.

[timtom2] 19/3/2008 10:38

clogue - going forward in this market all that will be highlighted in the press is reduced profit. Sentiment is not in their favour and the only way to battle against that is maintaining profit. Talking of increased revenue, growth etc won't hack it for a while. I expect to see drifting or more weakness. 2 years on it will probably have a booming share price but for the next 12 months?

[clogue] 18/3/2008 15:30

Mad,Tim,
How about charting the share price over the last three years against any index you like, I can tell you it does not look good.
They sat on a mountain of cash and didn't have a clue what to do. When the previous management did move they made a complete mess of things.
The new CEO may have made a mess of his results statement but he does not have a tough act to follow in terms of increasing shareholder value.

[madgooner] 18/3/2008 14:11

Been a long time supporter of these, but change of management is a key risk.

how long before we have potential mbo for outgoing team as a threat to upside?

Very sad..

[clogue] 18/3/2008 10:06

On further consideration I now now see that the gross profit will be there, and even increased, but that the bottom line will be less due to the profits invested in the business.
In my simple way of thinking I would just take some of my cash and invest it in the business but I take it that accountancy rules would make me set it against profits for that year.
I take the point that we had a company with a pile of cash but little idea of what to do with it. We now have a company with cash (or near cash) of at least £9m and a plan that they can fund out of profits.
As long as they don't throw the baby out with the bath water we should see real progress from a company with plenty of cash and a large and expanding market.

Edit: You don't have to show bottom line profit for the market to upgrade the company. With rising turnover and increasing top line the share price will rise.

[forwardloop] 18/3/2008 09:45

posted this on Ample

Mkt uncertainty.
Spooked by the statement that profits in 2008 will be substantially lower because of investment. (even though sales are predicted to double)

So on the one hand - offering substantial growth in sales on the other execution risk (of employing more people to do so at a time when other co's cutting back due to economic uncertainty)

Ample : shares in circulation statement is in in error . It is 22.03m ( diluted = 23.121m)

@125p that gives mkt cap of £29m of which cash is now only £7.3m (31.5p)
Ex cash the PE is 94/11.4 = 8.25 but is pretty meaningless if profits are to fall in the near term as planned and there is a risk (not stated) that cash will get used up. Uncertainty prevails.

Hence the fall. This is not the mkt for investing in promised growth. I can see other companies in the same position having fallen to cash holding value (32p perish the thought!!)

FWD

[timtom2] 18/3/2008 09:10

Now is not the time to get in unless you can ignore the share price for at least 12 months. This is not the bottom. Buy-in in 9-12-15 moinths time.

I too am a little troubled by the wording and style of new CEO.

Sorry to post this - have made good money off NCH in the past - but

[nurdin] 18/3/2008 09:08

Dont think they will be reducing profits this current year per se....the profits will be reinvested to build up the infracture in order to address what they see as a potentially huge market.

In my view the previous management had no ambition to grow the company and squandered their huge cash resources.The new management appear to have a growth strategy atleast and are putting that in place.

NCH currently have an EV of of just £11m if you assume £10m cash.Thats for a company likely to generate sales of £70m in 3 years time.Even on 07 results they are valued at just 1 times sales which is way too low for a high tech company with proven technolgies and increasing sales.

[clogue] 18/3/2008 08:42

Increased inventory of £2m and increased deferred revenue of £1.6m brings us back up to £11m figure.
I can't say I like the style of the new CEO. Can you really say that, through a deliberate policy change you will be substantially reducing profits in the next year, and just leave it at that ?
The share price has been battered and he (deliberately?)batters it some more. Is this a not very cunning plan to make himself look smart further down the line ?

[outsider] 18/3/2008 08:41

I guess long recovery, so out, get back in later.

[rivaldo] 18/3/2008 07:50

Excellent results, but the comment about investment affecting 2008 results is far too vague (apart from the obvious reduction!) - does he mean reduced from 2008 expectations or from 2007 levels?

The market probably won't like it, but then the share price has been so beaten down already that there may not be that much more to go!

NCH has £7.3m of cash too against the £24m m/cap, though that's far less than I thought due to the increase in working capital - the receipt of debtors should increase the cash back to £10m or so.

[outsider] 18/3/2008 07:43

Very pleased that Abridean has been squashed, just a leech on cash over the years:

In conjunction with the Group's newly adopted Product Delivery Group process,
new management has determined that the various products provided and development
efforts being undertaken by Abridean in conjunction with nCipher are no longer
strategic to the Company's near or long term future and will not therefore be
brought to market. This has resulted in Abridean, in 2008, being put into a care
and maintenance mode pending future discussion with potentially interested
parties.

Outlook is tremendous if they double sales over next three years:

Outlook

We now consider that the global commercial opportunity directly related to the
Group's expertise and technologies is both more substantial and growing more
rapidly than has previously been predicted. We have, therefore, set ourselves
the target to double sales over the next three years and are making significant
additional investment this year to improve all aspects of our business.


However short term profit reduction is going to be required to invest for next three years growth, but I'm also pleased at the diversification of clients (now in header) and I think this stock has wrongy been thought of linked strongly to financial turnover, it's clear a much more broader base is evident