Share Name Share Symbol Market Type Share ISIN Share Description
Zoo Digital Group LSE:ZOO London Ordinary Share GB00B1FQDL10 ORD 15P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  +0.00p +0.00% 10.00p 9.50p 10.50p 10.00p 10.00p 10.00p 99,576.00 07:57:09
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Software & Computer Services 8.1 -1.0 -1.7 - 3.26

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Date Time Title Posts
27/3/201714:20ZOO Digital1,972.00
02/9/201523:32ZOOtech the rebirth....6,909.00
14/4/201009:15Zoo Digital Technology with a market set to grow strongly7,309.00
03/10/200913:01ZOO is POO....9.00

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ZOO Digital Daily Update: Zoo Digital Group is listed in the Software & Computer Services sector of the London Stock Exchange with ticker ZOO. The last closing price for ZOO Digital was 10p.
Zoo Digital Group has a 4 week average price of - and a 12 week average price of -.
The 1 year high share price is - while the 1 year low share price is currently -.
There are currently 32,561,160 shares in issue and the average daily traded volume is 0 shares. The market capitalisation of Zoo Digital Group is £3,256,116.
martina pescatore: Mudbath Such a hypothetical scenario might result in: a) A Rights Issue to raise £2.5M before costs (£2.0M after costs) at 17p per share = 14.71 million new shares in issue. b) £3.0M of CLN converted to equity at the conversion price of 48p per share = 6.25 million new shares in issue. Current shares in issue = 32.661 million, with debt at circa £6M, I think, including CLN. After a) and b) above, the company would have only £3.0M in debt and £2.0M in the bank for working capital to build and grow the business. However, after a) and b) above there would now be circa 53.621 million shares in issue (i.e. 40% more shares). Therefore, eps would be significantly diminished, although I accept that the attractiveness of the company to the market would appear to be more appealing. At the half year basic eps was 2.07 cents (say 1.6p). The second half looks as if it might be similar to the first half, after the recent TU, therefore, let’s assume basic eps for the year at 3.2p, but based on 32.661 million shares in issue. If there were to be 53.621 million shares is issue, this eps becomes circa 1.95p, I think. Put the recapitalised company on a p/e of 10, this could give a share price of 19.5p (mkt cap of £10.46M). Too low? Maybe. So… On a p/e of 15, this would give a share price of 29.25p (mkt cap of £15.68M). Still too low, perhaps, for a company now with a minimal debt to cash ratio and profitable(?) and growing (EBITDA forecast to be up minimum of 800% for year end 31 March 2017, compared to previous year, as per recent TU)? Also remember that if £3.0M of CLN at 7.5% interest and £600,000 loan from wife of CEO at 10% interest, equates to nearly £300K in interest payments that will be massively reduced and the company becomes more profitable, all other things being equal. On a p/e of 20, this could give a share price of 39p (mkt cap of £20.92M). Or… On a p/e of 25, this could give a share price of 48.75p (mkt cap of £26.14M). If CLNs were to be converted, at the conversion price of 48p per share, this might after all suggest a fairer share price at close to 48p. The above are obviously crude calculations and are only suppositions of course. However, the p/e suggestions are not forward p/e’s, from where many growth companies appear to be assessed. NIA and DYOR of course.
mudbath: uknighted Thank you for those interesting observations. Having read Zoo financial reports for the past three years,I gain the feeling that their narrative truly reflected actuality.I therefore hold the opinion that we can rely on the integrity of Thursday's trading update. Accordingly I am particularly encouraged by their comment that cash flow had improved month on month and continued to do so.I believe this to be a step change and a necessary one for ZOO. The projected minimum EBITDA of US$ 1.8 million is for me an eye opener.Any further improvement in this area through the next financial year would make the shares look incredibly cheap.(imo) As it stands I am surprised that the share price has not already moved to a much higher plane;hence my adding over the past two days. I look forward to further BB comment over coming days,together with an uplift in the share price.
mudbath: Good to see the positive reaction to this morning's trading update. If only the improved trading, EBITA etc managed to throw off significant cash then the ZOO share price might well take off. As it stands though,it does not. We will have to see how those discussions go with the Loan Note holders. They will surely want to see growing ZOO success and a rebasing of the LN terms allied to a some additional funding might prove to be a catalyst for more rapid future expansion,in all areas. imo.
martina pescatore: Indications from the company over the last few months have been good, which has unfortunately not always been the case for Zoo over recent years. In fact, Zoo have been telling a more positive story from my perspective for over a year now and the growth in t/o and a move into profit would indicate a new trend I hope, especially with the positive growth comments by the CEO and chairman. I believe that the current share price is very reflective of the past disappointments with the company, but if their turnaround continues, it would only be fair for the market, in my opinion, to reassess the company and a rerating should be on the cards. Meantime, I suppose it is an investors opportunity/risk to take. With the new products and services from the last year which are taking market share and growing, as per company statements, from a starting point of nil before the products/services came about, this points to further growth in t/o in my opinion. Also, as a software company, Zoo do have the potential to be very profitable, once costs and R+D are covered. The most recent interims indicated basic eps of 2.07 cents (1.65p per share at current US$1.22 = £1 exchange rate) and diluted eps of 1.59 cents (1.3p per share) for the six months to end September 2016. If Zoo can simply breakeven for the second half of the year to end 31 March 2017, by my calculations, the current share price of 10p equates to a P/E of less than 8 based on diluted eps of 1.3p per share, or a P/E of circa 6.1 on basic eps of 1.65p per share. Judging by what other companies P/E's are, this looks to be too low for a growing company. If Zoo can, however, produce a little profit for the second half as well, then perhaps full year basic eps of 3 cents (2.5p per share) might be achievable. This would put Zoo on a current P/E of 4 times basic eps of 2.5p per share (all projected of course). One can quite easily see potential share price growth from current levels if Zoo can continue their recent growth trend and continue adding clients and partners and continue bringing new products and services to market. Also, I have been watching the Zoo subs ticker quite a bit recently to see us pass the 150,000,000 mark, which we did yesterday. Over the last few weeks and months the Zoo subs ticker has been notching up at a rate of circa 1,000,000 per week. Yesterday morning the ticker read 149,918,688 at 07.30am and this morning it read 150,455,686 at 07.39am. A jump of over 500,000 in around one day. A very nice jump admittedly, but it would be nice for it to continue at these levels. NIA and DYOR
martina pescatore: If Zoo make a £1m profit and put out a confident statement like: continued strong growth anticipated; market share growing; good demand for products and services; new software products being developed or trialled with customers;..... then, a p/e of 20 would not be amiss I feel. Take off the £5million debt and a mkt cap of £15million is arrived at. With 32,660,660 shares in issue, we could have a share price of circa 46p. I have looked at many more scenarios and higher profit levels going forward one year out and beyond, and the potential share price would be a multi bagger indeed. Given recent company announcements and the company's strategy, the risk:reward ratio at current share price levels appears very much to be balanced in favour of the reward, in my opinion. NIA and DYOR.
martina pescatore: But the market appears to only be noticing them slowly, to my mind. Remember, Zoo have only 32,661,000 shares in issue and a share price of less than 11p. If Zoo continue to rebuild the business as they have done over recent years, then the growth prospects in this digital media and entertainment field make for an exciting risk/reward investment case, in my view, at this price. I know Zoo have debt, of circa £5.8M from my calculations, £3,075,000 of which is in CLN's (Convertible Loan Notes),exercisable at 48 pence. If these get exercised then the number of shares in issue will still be under 40,000,000 and debt will be down to £2.725M, all other things remaining equal. The CLN's also require Zoo to pay 7.5% interest, so the CLN's cost Zoo around £230,000 in interest payments at the moment anyway. Without these payments, Zoo would be even more profitable than they currently appear to be. I am not saying that the debt is a good thing. However, it should be appreciated that the CLN's are ostensibly with substantial long term shareholders who's interests are likely to be aligned with those of the company. NIA and DYOR.
martina pescatore: An interesting indication that zoo, as per news on 4th August on their website, want to demonstrate to potential customers at the IBC 2016, how they deliver 250,000 minutes of outstanding quality subtitling per month. Clearly this is not the amount that goes through the zoo ticker on the website, as the ticker goes at about 1 million per week (4 million per month). The ticker, therefore, is likely to be where they have securely stored subtitles/captions, etc., for clients. The 250,000 per month referred to above, must therefore be what zoo produce themselves. A quick search on the web shows that subtitling rates vary considerably, although $4 per minute for tv/movie content seems to be a reasonably fair amount acceptable by translators and acceptable to companies paying them. Other costs incurred are also likely, but I am not knowledgeable in this field. Does anybody know what zoo might be charging per minute for subtitling? Zoo, with their software and Zoocloud must be able to offer efficiencies that other older fashioned companies cannot, as well as the add-ons, such as secure storage, reformatting, and future packaging and digital distribution, etc. Even if zoo are getting only $5 per minute for subtitling, after allowing for translators and other costs, plus $1 per minute for securely storing, total $6 per minute, this equates to 6 x 250,000 x 12 = $18,000,000 per annum. Just guesswork clearly, but all I have to go on really. The above could only reflect the current run rate and it may not yet be correct to annualise it. However, Zoo also do other work and have other sales other than subtitling. If the above is anywhere near correct, then the prospects for the company do seem very reasonable, IMHO. See also item 5 of the 4th August news item on their website. Zoo seem upbeat about the next big thing in the video industry, which they say is enriched metadata. If they are correct, and they have a software offering which might help search and find such metadata, this could be worth something to those digital online retailer and movie/tv/video entertainment companies. Is any of this potential in the share price? Personally, I hope that with the various innovations that the company has made over the years, they are about to pay off. NIA and DYOR.
martina pescatore: We all want a higher share price I suspect. However, the share price needs to reflect the performance of the company and the perception of the market. A share price of 20p, for example, would equate to a mkt cap of circa £6.7M. If the company makes £1m PBT, and using a P/E of 20, gives a mkt cap of £20M, less circa £6M debt/borrowings, gives £14M mkt cap or a share price of circa 42p. Personally, I would be very disappointed with a 20p share price after a positive trading update, such as for example, a good trading performance, growing demand for existing and new software and services, a growing customer base and a growing pipeline of new customers, and a £1m profit for the year. If the trading outlook is very good, the visibility of earnings that the company is aiming for (read the last few results statements) should hopefully be sustainable and repeatable, and with less reliance/emphasis on a large single customer. Consider also the two new senior business development staff (for Europe and International markets) recently having joined the company (from competitors such as BTI Studios and Deluxe) and ask why? and the new products that they have brought out and ask why? It all sounds very positive from where I am sitting, but perhaps I am biased and looking at it too positively. Time will tell and I do not want to get ahead of myself of course, but should Zoo turn things around and start to have good visibility of repeatable earnings and make a sustainable and growing profit, the share price has the potential to increase many multiple times. Into the medium/long term, this could be a very different company with a very different valuation. NIA and DYOR. Here's hoping. I hold shares in Zoo Digital, naturally.
martina pescatore: I have been doing some crude "what if" calculations. If Zoo make a £1M profit this year (not impossible as they were EBITDA $0.9M at the half year and business appears to have been increasing), this £1M profit could be after tax as they have tax losses to use up I understand. If we adopt a p/e of 20 (not particularly high for a growth stock it would appear), this gives a mkt cap of £20M. Less dilution from options and debt, say £5M worth, give a diluted mkt cap of £15M. Crude, I know. With circa 33M shares in issue now, this gives a potential share price of 45p. This suggests to me that there is substantial potential upside from the current share price of 10.6p. Zoo has over the last few years or so failed to meet market expectations and the share price has been hammered, hammered so hard that at 6p (I think it reached) the mkt cap was circa £2M. The current share price of 10.6p in my opinion still reflects the previous disappointments that the company has offered the market, until it started recovering about a year or so ago, but it does not reflect much, if any, of the potential going forward. There in lies the potential for share price growth, particularly as the market they are operating in is growing, with clear growth trends and because Zoo seem to have a good product which is taking market share. If zoo can turn a profit and meet market expectations, then the rating the company is on should change. The market rating Zoo has been on suggests to me that the market has almost been not expecting anything, or anything other than disappointment, from Zoo. Therefore, if Zoo better this, and things are starting to look positive again, then market perceptions could quite easily change for the better, and logically market ratings should follow. Moving forward, if growth continues and Zoo were put on a forward P/E of 20, and were projected to make £2M next year, then the current share price looks particularly attractive. (£2m x 20 = £40M, less £5M for dilution and debt = £35M mkt cap (or 106p share price.) I daren't do the calculations going further forward, because the numbers and multiples of the current share price get silly. There would be ups and downs in the share price naturally if the above hypothesis materialises, but as long as the company can grow t/o and profits, and importantly meet or exceed market expectations, then the upward trajectory in the share price would normally follow. New buyers at higher prices than recent lows are often longer term holders/investors as they are seeing the story emerge and the potential achieved, when a company grows and grows. Ultimately, the aim would be for Zoo to start paying its shareholders for holding its shares and not expect shareholders to pay for holding them. All IMHO and NIA, etc.
mudbath: Agreed Nicyts. If you are indeed correct,then I believe that we might see the ZOO share price edge steadily,yet unspectacularly,in an upward direction. What do you say Bakunin ?
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