Aeorema Communications Share Discussion Threads

[ramas] 28/1/2016 09:50

I'd say AEO has been savaged by its slightly disappointing results .. The price is where it is because you have 20p of support, covered by its non business's specific assets. AEO is valued at effectively £600k that in all likelihood / worst case will deliver £200k pretax profits this year and distribute all profits via a dividend assuming the cash remains at the circa £1.5m level representing approx 3 years worth of support in the event of a protracted downturn in business. I suspect there are lots of potential buyers waiting to buy should the price go below 20p myself included where I would be prepared to break my own stock allocation discipline

[clocktower] 28/1/2016 09:10

Strange that in some areas the markets are marking stocks down seriously when any poor news has been announced even when the prospects of profits exists in H2 but here it seems to be surviving the worst of the poor news for the time being.

[pj 1] 27/1/2016 16:27

thanks homebrew!

[homebrewruss] 27/1/2016 16:08

PJ1 - have you checked out the SCAN thread at all?

with some of the software available to the PI eg sharelockholmes, stockopedia etc it's possible to backtest share screens and see how they perform in the various bull and bear markets over the last 12 years or so.

Within the thread are some ideas of screens that might work better during bear markets.

[ramas] 27/1/2016 09:32

The market is very demanding even blue chips are not safe , think BLT as one example. Problem with micros is a good story gets pumped out of proportion and manipulated by the twitterati, while a successful small profitable dividend paying business think AEO is always viewed as a glass half empty story. I understand part of it is to do with aim is there for the riskier fledgling businesses. It's all about weighting your portfolio correctly. For me this AEO drop is rather frustrating but in the scheme of things not a problem, that said I don't like returning my profits to mr market.

[clocktower] 27/1/2016 09:22

PJ1 - 2015 was the opposite but 2016 has started very poorly but that said, having remained mainly in cash the downside has been very limited.

A couple I have a very small investment in that are USG - TAL - LWRF but looking to invest in other micro caps when the market mood alters, and that maybe a while.

Also following FBDU - IGE -KRS amongst others.

[a2584728] 27/1/2016 08:52

This company would be best off as a private company.

[pj 1] 27/1/2016 08:40

Off thread someWhat guys/gals but a genuine question.

2015 was a disaster for me with micro caps, most of my losses coming from them.

Has anyone had any success with micro's recently? I am now not planning on entering any more for a while

Cheers PJ

[clocktower] 26/1/2016 20:57

How do you know that the blog is not all fiction? Easy to write regardless of truth or otherwise - It is all about what you believe to be true or otherwise. Question everything and everyone, assume nothing. I am not suggesting mm`s blog is not truthful, having not read it, as I see no point in reading it. In the same way as there is little to be gained by reading remarks I have or may have made here, if you hold views that differ and see yourself in a different light to what others may see you in, by way of your postings or blog on this or any other site or thread! Support Free Speech as though your life depended upon it.
How do you judge success? What is your measure? How do you form an opinion as to who, if anyone is jealous?
Enjoy life while you have it and give to others less fortunate, you can only eat three meals a day at most, what more do you need!

Good Luck with your trading/investing one and all.

[russ505] 26/1/2016 20:08

susiebe 26 Jan'16 - 16:27 - 3610 of 3618

I for one am very interested to read mm blog as am willing to learn from someone who has obviously been very successful.I have not seen anything rude from him,on the contrary.
I think some just find it difficult to accept that others just might be more successful than themselves.Must be a male ego thing?!

Me too,i also enjoy reading mm blog,a well balanced and honest view.Unfortunately some very nasty jealous people about.

[rndm355] 26/1/2016 18:51

Clocktower: I didn't suggest that anybody else would buy the company and obviously the BoD would not sell out around these levels so not sure what your point is.... I think you are trying to provide us with an education in the bleedin' obvious, as with your point re: dilution ;-)

[clocktower] 26/1/2016 18:42

Never suggested they were ramas but just pointed out that dilution occurs with these options when taken up, and if profits slide as they have since they were last taken up, the effect multiply`s the downward trend. It might not even happen but it is a way of rewarding themselves other than by way of drawings/salary.

[ramas] 26/1/2016 18:36

You make it sound as if previous awards have been excessive which just isn't the case.

[clocktower] 26/1/2016 18:21

Expect them to issue more options once the share price has settled to allow them to reward their talent ramas - which in turn results in dilution, as has occurred in the past.

[ramas] 26/1/2016 17:57

To be clear the going private question is off the table , I raised this question at the agm , it allows them to reward ( err maybe not today ) talent and but they are fully aware of the shell valuation they would be sacrificing ... Should things really go wrong which is unlikely then there are plenty of entrepreneurs willing to buy the listing and reverse a business into it , NIPT and OPTI as 2 recent examples. The current value including the cash would be min 20p hence today's market value of AEO of a paltry 7-8p or about £700k talk about margin of safety. Of course the lack of liquidity might take us to 20p and part of me likes the idea of buying at this level - for what volume one could get as we all scrabble for the stock. Could of course be a merger between one of their private competitors , now that's quite an interesting thought ?

[hydrus] 26/1/2016 16:36

Michael,I think you and I have similar investment styles reading your blog and knowing where we have both invested previously. You may want to take a look at PVG. It takes some prodding but a recurring revenue model with high margins and high growth...Good luck if you stop posting, will be a shame

[clocktower] 26/1/2016 16:29

Nobody else would buy it rndm355, as it is all about the quality of the leadership and staff, take that away and you are left with nothing. However, I think they had a five year plan that most likely required this to remain a plc to be able to generate funds when required to make acquisitions when opportunities present themselves.So the funds in the bank could be used for that to give the company more momentum.

[susiebe] 26/1/2016 16:27

I for one am very interested to read mm blog as am willing to learn from someone who has obviously been very successful.I have not seen anything rude from him,on the contrary.I think some just find it difficult to accept that others just might be more successful than themselves.Must be a male ego thing?!

[rndm355] 26/1/2016 16:18

I see that this is a very long thread with very many share price predictions by clocktower, including the prediction of 50p+ as of seven months ago.

For what it's worth to all concerned, the shares not held by the directors are now worth less than £1m at the current share price and so it would not surprise me if they decided to make a bid for these shares, which could be fully funded by the cash in the company itself.

[ramas] 26/1/2016 15:16

Mrx As a shareholder of 4 plus years AEO earnings are always higher in the second half, so Hales statement is standard to other years, but we can agree it will be a tough albeit profitable year .... IMO dyor of course.

[michaelmouse] 26/1/2016 14:34

PJ 1 - Thanks.

"If you're not prepared to hold a stock for ten years then don't even think about owning it for ten minutes"

Can't remember the name of the guy credited with this quote? Although I think he then bought Tesco shares and regretted having said it. :)

On a more serious note.

Some sensible comments on here already by the posters that I bother to read (that's everybody except clocktower ;). Can't add much really. Obviously disappointed that results are a little below last year (although not significantly) since we all want to see growth, but in essence, nothing has changed for me. Profitable, cash generative, debt free, Directors interests aligned with shareholders, dividend payer (already received nice yield) etc. It ticks most of my boxes.

I'll sit it out as always, and possibly buy dips. The company is only valued at about £2.5m, and half of that is cash on the balance sheet.

Avesco was in a similar situation in 2009, I just kept buying the shares when they were in the 20p-25p range when it felt like it was just me against the "white-walkers" :). Now they're in the 200p range.

I still like the risk/reward balance at AEO.

Just in case you've missed my blog/post comment elsewhere, I will rarely be posting from now on. I am fortunate enough to have been quite successful over the years, and I sometimes build up shareholdings in companies over significant time periods. I have no intention of alerting the world and his wife to these opportunities any longer. Also, I am a long termer and generally most bloggers and BB posters are traders so we operate in different worlds with different time scales.

I've commented on AEO before, so in this instance it's no skin off my nose to perhaps make this one of my last posts.

Regards PJ 1 and others.

[gwr7] 26/1/2016 14:23

lol. Another mickey mouse company.