Airbath Share Discussion Threads

[bruce the goldfish] 07/1/2002 13:18

I am not sure of the profit split between the 1st and 2nd halves CB7, however, Aquarius (AQG) Airbath's former parent company have clearly stated in the past that the second half is historically the stronger period. Therefore your analysis of between the first 11 and following 13 weeks for ATU is probably not far from the truth.

BTG

[cb7] 07/1/2002 13:11

judgement's analysis is strictly speaking correct, however most analysists or investors use pre-ex eps for valuation purposes. Doubling 1.54 gives 3.1 and deducting 250k should give headline eps about 2.3 . But the 1st 11 wks produced only 0.41eps, whilst the next 15 wks made 1.13 .....if the remaining period stays at the latter level then 3.4 will be attained or an improving trend could easily give eps around 4 pre-ex. Unfortunately, I dont know when interest payments are due or the seasonality (if any) of the business--anyone shed any light on the profit split 1st/2nd half???

[bruce the goldfish] 07/1/2002 09:50

Thankyou for a most well reasoned and empirically driven justifcation on this share stockinsider. Would you care to disclose to the rest of us on this bb why ATU is such a 'strong buy' in your book?

BTG

[stock insider] 07/1/2002 09:41

buy buy buy. very strong buy.

[bruce the goldfish] 06/1/2002 15:28

I agree bigman, most cash shells exist to bring private compaines to market in a quick and effective way. However, with the many oversold public companies in the markets at present, I believe (and this is my personal opinion) that the likelihood a cash shell would buy an existing lowly-rated public company is considerably higher than over the last few years. The chance that a cash shell would be interested in ATU is very remote and I was suggesting it only as a possible means of ST gain. Many cash shells operate on the premise that they would buy a number of indpependent companies that would operate better as a collective unit, benefitting from synergies, cost savings and the potential to increase a client base. It is possible that one of these companies may be publicly quoted. Anyway just my own ramblings and believe me I am no expert.

BTG

[judgement] 06/1/2002 11:44

WA,

If you read the results, you'll see that the 1.54p is for a six month period. Looking at the performance in previous years, and taking into account the 250k exceptional costs, full year eps looks likely to be around 2.3p, equating to a per for the current year of 5.3.

One factor which will keep the share price low is the current value of equity shareholders funds, at -£362k. Until this value moves positive and approaches the market cap, the share price is likely to remain low in comparison to earnings and revenues. By the end of the current year shareholders' funds seem unlikely to grow to more than -£300k.

[bigman] 06/1/2002 09:53

Hi Bruce, I seem to be following you arround.
Cant get my head round why you think a cash shell would look to buy ATU, ATU is already listed so there is no benefit to a cash shell in buying it. Cash shells are looking to buy private company so that in fact the private company gets a listing on the cheap by reversing into the cash shell and then the shares trade higher.

[bruce the goldfish] 06/1/2002 09:46

Welshanalyst - I agree with you when you say that ATU surely must have the most attractive PE in the market at present (between 2-3). However, the other side of the coin is that net debt is still higher than the current mkt cap, so if ATU ever became loss-making there would be the real prospect that the company could get itself into trouble. Although, saying that the management are obviously confident in the prospects of the firm (and its underlying profitablity) as they would not be paying such a high yield (circa 9%) on the stock otherwise.

I personally believe that ATU will linger around its current lows for the next 6 months or so, until the company announce the final results. When these results are announced investors (and shareholders alike) should get a better picture of where this share is heading. However, I read an article the other day on citywire talking about all of the cash-shells in the market at the moment with itchy trigger fingers who are on the hunt for acquisitions. ATU is a prime candidate for such a move, and this would definately give the stock some ST momentum. As I have said all along patience is the key with ATU as with many other sleeping stocks, and I truly believe that LT holders will reap great returns. This stock is most definately not one for traders or ST holders.

DYOR

BTG

[thecleaner] 05/1/2002 21:52

Thanks for bringing this to my attention folks. This one is screaming at me. I'm in on Monday...

[welshanalyst] 05/1/2002 17:39

The recent results indicated earnings per share of 1.54p for a 15 WEEK period, so this would lead to a full year eps of 5.34p for the full year, if extended proportionally.
The PE ratio would then be 2.25, which is amongst the lowest and best in the whole market.
Any comments, Bruce the Goldfish, and does anyone know of a better PE ratio.

[bruce the goldfish] 05/1/2002 10:09

ATU is still in my portfolio, however I think that it will be a long wait before this stock starts to move in the right direction. There are too many uncertainties at present for a sustained rise, but in the end I think patience will pay. Not one to put the mortagage on, but could be a nice little earner in a couple of years.

DYOR

BTG

[cb7] 05/1/2002 00:37

agreed having negative shareholders funds gives little safety, but it doesnt make them technically insolvent at all......that situation only arises if they are unable to cover repayments when due.....they have interest covered over 5 times and with a strong consumer demand and housebuilding sector, I cant see difficulties ahead. The interim statement indicated a good order book and a healthy dividend also implied "cautious optimism". I think your views are clouded by AQG's past rather than ATU's present/future.....eps could reach almost 4 on a pre-ex basis

[johnduffield] 04/1/2002 22:46

See above. ATU is now off my monitor.

[modo] 04/1/2002 16:55

Surprised not to see "stock insider" here, as he has ramped ATU on 23 different threads this morning, unless of course he has more than one name of course!

Modo

[mali7] 04/1/2002 12:30

When is the final results out?

[skyracer] 04/1/2002 11:06

Up to their old tricks

I remember Aquarius, I actually made some money out of them before their demise. Looks like the Directors are up to their old tricks again. Technically insolvent, ATU is one for the gamblers. There is no balance sheet safety net hence a downturn in demand and this goes bust.

Verdict: Wait and see

[suffolk~hathaway] 19/12/2001 10:34

Sorry BTG - I think I must have meant CHA.

[bruce the goldfish] 19/12/2001 09:22

I am with you on that score mali7, however, I think the run up to 20p will be a long race but the tortoise should finish eventually. Like you though I am also confused as to why the price has gone down since its 12.5-13.5p high yesterday. That 100k sell of course may have had a bit of impact on this but as you say the buys have far outweighed the sells so this is a little unusual. I notice another 40k buy from earlier on, a few more of those and the share price would surely be forced in the right direction. Does anyone know if any of the papers picked up on ATUs results this morning?

[mali7] 19/12/2001 09:12

Solid buys since yesterday and the price is going down, why??
I bought in yesterday on long-term basis as I believe the company has the potential to be above 20p within next year. Any views?

[bruce the goldfish] 19/12/2001 08:43

Good article over on Sharecast this morning. Full year profits expected to be #1.9m for the full year to March 2002 (before #250k of exceptionals) on turnover of #17m. Current PE of 4. Dividiend Yield of 9%.

BTG

[master rsi] 19/12/2001 00:49

royaloak

If the 25K is your deal, is reported as ? as is over market size and delayed by one hour, and not as a sale as you are commenting.
------------
Results look good and at this price undervalued, though the borrowing is too high for me.
Nevertheless I placed and order early on the morning at 12p but the MM beat me with two buys in a row and I did not wanted to pay anymore so I am not in.

[bruce the goldfish] 18/12/2001 16:55

SH - I have never posted on PRM, are you sure you followed me here from over there? Anyway you are right to say that AQG left ATU with a good bit of debt but ATU is in the fortunate position of being able to service this debt quite easily due to the cash generative nature of the company. I think if the ATU board had any worries about managing debt they would have overlooked a dividend. Like I have said in an earlier post this share is not going to set the world on fire, but it should bring in a decent return for those patient investors.

Regards

BTG

[suffolk~hathaway] 18/12/2001 15:16

BTG - followed you over from PRM.

Quite interesting - but Aquarius left it with plenty of debt so you wouldn't
want many hiccups.

[royaloak] 18/12/2001 13:05

Master RSI

I use proquote level 2, when the deal was published it was shown as a sell, now in the trades section it is put in the 'other' column. To confirm I bought 25k at 11.85 at 8.24.

Regards, c