Capital Share Discussion Threads

[thepopeofchillitown] 14/1/2021 13:04

Back in today.

[dangersimpson2] 14/1/2021 11:14

Tamesis are clear that they are being intentionally conservative, saying "...the forecasts and growth referred to above are still very much skewed to the upside."

[deanowls] 14/1/2021 11:08

If Tamesis maybe looked at who was selling and matched them up with some investors we wouldn’t be so lowly rated.

[adamb1978] 14/1/2021 11:01

Looking at consensus estimates, they are grossly behind events in my view.

EPS for 2022 showing as 10.5 cents (CENTS!!) based on a 12c figure from Berenberg and 9 cents from Peel Hunt. In my view, the 2022 EPS will in the 14-17 cent range.

Obviously helpful for us to take positions (and I've added more this morning) but possibly also meaning that the company will continue to fly under the radar until those analysts improve their infant-like maths skills and come up with proper estimates.

[adamb1978] 14/1/2021 10:22

The Tamesis figures still look somewhat light to me.

If you take FY20 revenues of $135m and try to bridge to 2022 when the mega contract is in full flow, that'll add say c.$60m revenues p.a. That takes you to $195m in 2022 alone. Tamesis are assuming $215m revenues in 2022 so really arent being that ambitious on other wins over the next 2 years.

Nearer term, H1 EBIT was $9.6m and they forecast $15.3m for the full year

I agree with their conclusion about share price being very low though!

[dangersimpson2] 14/1/2021 10:13

Slightly disappointed with the Q4 performance, I'd expected slightly higher utilisation. I think this was partly to do with timing, I'd under-estimated the mobilisation time in the current environment so I think lots of the new contracts started partway through Q4. It is interesting that they mention even more rig movements into West Africa since this is clearly key to the utilisation increasing further.

Of course, the flip side of this is that these shorter-term contracts will go longer into 2021 adding to the strength of results there and the outlook here is of course very positive.

Good to see that Tamesis finally getting up to speed with events and moving their price target. I note another small upgrade in 2021E EBITDA. Seems daft that Tamesis went from c$32m to $51m EBITDA estimate for this year in the last six months and they've only just thought that their price target needed review.

At least they are now recognising that the company is "bewilderingly undervalued".

[shanklin] 14/1/2021 09:36

LOL rivaldo

I nearly posted earlier that I thought the share price should be twice current levels.

But then thought WTFDIK and decided against it.

Very pleased to see Tamesis came to much the same conclusion based on much deeper knowledge of the company. This is my 4th largest position albeit none of that is unrealised gains.

[rivaldo] 14/1/2021 09:32

Tamesis Partners have now increased their target price significantly to 127p.

They conclude that CAPD are "bewilderingly undervalued".

They see a massive 15.7c EPS for next year, i.e 11.6p EPS when the new Centamin contract kicks in.

They have 12c EPS for last year, i.e 8.9p EPS, including $10m of investment gains from CAPD's equity portfolio. Without those gains they have 6.7c core EPS, i.e 5p EPS at $1.35.

For this year (2021) they have 10.2c core EPS on both metrics, i.e 7.6p EPS. That's a P/E of only 8.2.



"Leaving the company bewilderingly undervalued

Capital Ltd now has numerous sources of income ranging from their traditional drilling contracts through the burgeoning MSALabs business through to the new mining services operations. Theinvestment side of their business also recorded its best year ever in 2020. They are now spread across Africa having successfully entered West Africa c.2 yrs ago.

As per this morning’s announcement trading conditions are “extremely positive”. So we don’t understand why the market is according such low valuation metrics to the business. The shares are trading on EV/EBITDA of just 2.6x and 2.0x for 2021 and 2022 respectively –equivalent to a discount of 45% and 54% to its peer group (none of whom are delivering the same scale of growth) likewise PER multiples of 8.2x and 5.4x. In addition,we estimate the company should pay a dividend of 2.4cps in 2021 and 2022, equivalent to a yield of 2.9% (with clear upside to our 2022 forecast).

As a consequence of the above we are raising our 12-month Target Price to 127p.This target price is calculated by applying a 5x multiple to our 2022E EBITDA of US$66.2m, and we believe the market will start to price this in by June this year."

[rivaldo] 14/1/2021 07:29

The Q4 trading update looks good to me - another half dozen new drilling contract wins, plus the big new Barrick lab services contract.

The quarterly numbers are only just below the excellent Q3, with the run rate now suggesting annualised $140m+ revenues with all the new contracts set to add to that. Whilst the annual numbers are nicely in line and well up on 2019.

The transformative Centamin contract will be earnings accretive towards the end of this year, and with the gold price so high all those new contracts should be joined by more in the meantime.

More specific guidance will come with the prelims, but CAPD's outlook is summed up by:

"As we begin 2021, we are encouraged by the strong trading conditions, with a number of other tendering opportunities in progress".

[tole] 13/1/2021 09:04

Did my bit to help and took a few more at this price.

[yasx] 12/1/2021 18:04

Is this overhang really the same seller? He must have finished by now - there must be others at it...

[shanklin] 12/1/2021 16:06

Can't believe these idiots did not use the placing to get rid of their holdings.

[dangersimpson2] 11/1/2021 12:16

Thanks mr d, let's hope CAPD give us an engagement present with the Q4 trading statement!

[gleach23] 11/1/2021 11:49

Underlying Bid beginning to firm here - moved from 61.16 to 61.44 this morning.

Offer also strengthening so hopefully share price on the turn in run up to Q4 update. Still around 55k available to buy currently.

Topped up trading position a little.

[mr doughnut1] 10/1/2021 10:00

Whilst we wait for news - last years TU was on the 16th Jan, this year could be this Friday - I would like to congratulate ds2 on his recent engagement, don't worry I am not stalking you, I follow you on Twitter.I wish you both every happiness on your journey togetherRegards mr d.

[gleach23] 08/1/2021 12:32

Looks like a few folk taking the opportunity to add on this dip @ 63.2p, me included on a trading basis.

Will add more if it drifts lower. Currently 55k available to buy online.

[adamb1978] 08/1/2021 08:41

Nice update! Not sure it warranted a RNS though! I'm considering adding a few more - only trading a few % above NAV by my calculations so feels like there is very limited downside here

[rivaldo] 08/1/2021 07:22

Today's RNS shows the Sukari expansion is progressing nicely - and quickly, ready for "the commencement of preliminary mining activity in late Q1 as planned".

Hopefully as gleach says this will be followed by a trading update in the next few days outlining continuing positive trading as per the bullish Q3 update:

[gleach23] 07/1/2021 11:41

Yes, there was a large increase in quantity available to buy online a couple of days ago. Currently it's around 600k shares so I'm not surprised to see a minor dip.

We should hopefully have a Q4 update next week or the week after so I'll be looking to trade any dips again in the run up to supplement my shareholding.

[yasx] 07/1/2021 11:10

Fozzie,

Indeed -but when they need to issue equity, out comes the promotional bandwagon, time and again.

[fozzie] 07/1/2021 11:07

If I had a fiver for every time we have said that over the years Yasx! Bloody useless most brokers in my experience, idle.

[yasx] 07/1/2021 11:04

Seller(s) still apparent past few days.

One thing that remains inscrutable is why they chose not to match the seller with those who were unable to get a sufficient allocation in the oversubscribed placing. That would have satisfied both parties and is surely a failing of the Co. and the broker.

One hopes the update this month enables this to grain traction.

[rivaldo] 07/1/2021 07:27

Encouraging results this morning from CAPD's drilling for ALT.

Most importantly, there's confirmation today that after the current drilling campaign completes, there are a number of additional prospects which will be drilled in a follow-up drilling programme:

[rivaldo] 05/1/2021 07:37

A brief overnight update from Mark Watson-Williams on Master Investor FYI:

"Capital Ltd (LON:CAPD) – directors buying more shares

Ahead of this mining services group’s trading update, due soon, I was pleased to see that boss Jamie Boyton, and fellow directors, showed faith in the group by taking up a total of 1.6m new shares at 58p in the recent £30m placing.

The group’s shares, which were 63p before the early December issue, rested at around 60p while the funds were collected in, then jumped up to 68p last Thursday.

Hold firm, I stick to my price objective.

(Profile 22.10.19 @ 61p set a Target Price of 100p)

(Profile 77.5p @ set a Target Price of 100p)"