 FROM LSE BB
Analysts at Canaccord Genuity have reiterated their 135p Target Price on airside solutions developer Aurrigo International (AIM: AURR) following the company's bullish year-end trading update:
“We expect there to be further positive progress, notably both on the ADT implementation with Singapore Changi, and on the auto-cargo project," said Canaccord.
The analysts also highlighted that, following the completion of the £5.25mn funding round in January, the company was well capitalised to support the next phase of growth.
For what it’s worth, I think the business is considerably undervalued:
• Autonomous division up a staggering 433% from the prior year!
• Automotive division delivered solid cash generation, and is now expected to report £5.9m of revenue.
• The company expects to report net cash of £3m at year end!
• Demand for the company’s smart airside solutions is on an upward trajectory as airports scramble to reduce costs and emissions.
• Partner network is rapidly expanding alongside a strong sales pipeline.
• A £5m capital raise at the backend of 2024 means the company is fully funded to profitability.
• 73% of the company’s 45.8m shares are in private hands. And of that, 48% is held by management. A phenomenal level of skin!
I often observe investors loosely banding about the phrase “No Brainer” when referring to unbelievably cheap, but potentially explosive ('multibagger') opportunities, albeit the target companies are often far from that. That, however, is not the case at Aurrigo. The company is both grossly undervalued and a potential bagger. And with that piffly free float, and when the volume arrives, the rerate here is likely to be quick and fast.
AIMHO |
Coventry manufacturer transforming airports across the world |
Aurrigo is very much under investors radar. Aurrigo International PLCInterim Results for H1 2024 | Flying High with Smart Airside Solutionshttps://lemminginvestor.substack.com/https://x.com/lemminginvestor/status/1839776253315874962?s=46 |
From the above link "The company was approached by International Airlines Group (IAG) to use its driverless expertise to develop the world’s first autonomous baggage carrying dolly."
This appears to be customer led demand for a solution.
Lots of trials and versions over multiple years. The winners appear to have a large market. |
Trial roll-outs continue...
Encouraging that they're a mix of airlines, airport authorities and state entities.
Some market research leads to get a handle on the potential market here...
(Numbers here are hidden but quite a few manufacturers listed)
Free sample research here...
BA operates "In Terminal 5 alone about 900 dollies" at Heathrow....
Some EasyJet numbers here following a contract with Rushlift for electric vehicles...
(65 baggage tugs, 180 baggage dollies)
Some prices.... |
How do people know how much the future is overvalued by? |
Huge premium to float price but falling back. |
!FOLLOWFEED
Aurrigo designs, engineers, manufactures and supplies autonomous products for the automotive, aviation and transport industries. |
What's occurring |
Final distribution 0.042p per share, so £30. Better than nothing I suppose... |
payment received today from barclays stockbrokers
quicker than i expected |
So that's it then, I suppose under the circs (collapsing Rouble etc)a reasonable outcome. |
So a sale of Unistream for $4.975m (or £3.34m) and a potential distribution of £4.5m, which is around 12p a share. |
Perhaps the Advisor is charging expenses? |
Three interesting pieces of information in the latest results
1. they have reclassified the investment in Unistream as current, meaning they are pretty confident of a sale in the next 12 months
2. the investment has been written down to £3.4m based on an indicative offer. Overall that would give a NAV of 12p a share (=£4.7m). Adding in the share buyback in April that puts the total resulting distribution to shareholders at £5.4m right on the threshhold for incentive payments to directors and the investment advisor.
3. The investment advisor seems to have received a performance fee of £68,000. According to the announcement on 31 March
"The Company has also entered into a new incentive arrangement with Nicholas Henderson-Stewart (the Company's investment advisor, the "Advisor") under which the Advisor will receive an additional incentive fee based on distributions to Shareholders made subsequent to the date of this announcement. The percentage of the distributions to Shareholders payable to the Advisor will vary according to the value and timing of such distributions, with no payment being due until distributions exceed approximately £5.3 million and the payment being capped at 4% of such distributions."
So how did he get £68,000??? |
Interesting positive update.
"Notwithstanding these obstacles the Board believes that it will be able to realise the asset in the near term. The Bank remains an attractive company due to its consistent growth, strong market positioning and cash generation."
Current NAV is 18.8p. The board and investment advisor are incentivised to return at least £5.3m to shareholders which would be 14p. I can't imagine they'd be interested in less, so current price of 9.125p looks good value. The overhead rate of £380k a year is about 1p a share. |
That is the question......Thanks,for info Stems. |
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