Chelford Share Discussion Threads

[tole] 27/4/2006 07:35

Charles-Stanley April2006

CHELFORD GROUP (CHR.L) (*AIM) – Strong Buy

The supplier of supply chain and enterprise software produced results to end December broadly in line with our expectations. Revenue advanced by 22% to £14.5m and operating profit by 50% to £1.44m. Earnings per share on a normalised
tax basis came 46% higher at 15.5p; the effective tax rate was a low 10% because of losses released from the holding company. During 2005 Chelford acquired Agility and Shian, which increase the scale and range of services that
the group can provide. Helped by a full year's contribution from these two acquisitions, we expect earnings per share growth of 55% in 2006. We continue to recommend the shares as a Strong Buy

[tole] 26/4/2006 14:59

Here we go moving up now - been tipped somewhere?

Edit. well the MMs dont want to deal online at the moment only allowing you buy 69 shares at full offer price. Can sell 15k though.

[tole] 26/4/2006 14:49

A bit of buying today and inching up a tad.

[tole] 19/4/2006 18:58

Also an updated view on Thisismoney - following on from the GCI tip.




Chelford continues to impress

SPECIALIST IT solutions business Chelford continues to quietly impress, with pre-tax profits up 36% to £1.37m last year on a 22% increase in sales to £14.5m. A brace of acquisitions completed during 2005 appear to have given the company a further boost too.

As an enterprise software and supply chains solutions provider, Chelford's products have historically been based on SAP technology, but the purchase of Shian in October has given the group a Microsoft-based offering for the first time.

This is important, says chief executive Trevor Lewis, 'because some customers will only be interested in buying a Microsoft solution'.

In addition to this the company has snapped up Agility Systems, which addresses the supply chain sector via the provision of radio frequency identification (RFID) technology. 'We recently installed an RFID-based parcel tracking system for Geopost,' notes Lewis, 'and as the cost of the basic technology is plummeting I think the market is starting to take notice.'

Growth has brought its own strains. In the second half of last year, for example, the company was forced to outsource a considerable amount of work to satisfy customer demand at the expense of margin. Lewis insists this problem has now been resolved.

At the current 277p ­versus 52-week highs and lows of 303½p and 170p, and giving a prospective price/earnings of 11.5 on forecast profits of £2.4m and 24p of earnings, Chelford remains good value.

Recommendation: Buy.

[diogenesj] 15/4/2006 18:10

Excellent results, marred only by the problems in the SAP division, which (as it seems to me) must improve in the course of the year.

This week's IC uses them, and Charles Stanley's consequent 11% cut in its forecast, as the reason to recommend selling at 277p. Still looks cheap to me, though, and I am holding.

[bernieboy] 13/4/2006 15:41

Great results (again) and all these great reviews and still we sit around £2.70! Incredible! Still as always I will hold and wait for the days of £4.00 + add if any funds become available.

[tole] 13/4/2006 09:07

Also as based with Jim Slaters Zulu Principle where it suggests buying PEG's below 0.75 as good value and 0.6 being excellent value.

Based on Charles Stanleys figures - Chelford currently trades on a PEG of 0.21

[tole] 13/4/2006 08:56

Nice focus in the results round-up in Shares mag today - highlighting Agility and the RFID technology and imminent deals. And shian and the employment of new staff to cut down on sub-contracting costs it faced due to demand for its SAP product.

Summary highlights CHR share price near the 12 month high but still trading at a big discount to the peer group software sector...

The same point highlightedin Charles Stanley recent note - at the current price of 277 CHR currently trade on a prospective PE 11.5x against the sector average of 18x

[tole] 10/4/2006 16:37

Chelford - BUY
Companies: CHR
07/04/2006

Specialist IT solutions business Chelford continues to quietly impress, with pre-tax profits up 36% to £1.37m last year on a 22% increase in sales to £14.5m. A brace of acquisitions completed during 2005 appear to have given the company a further boost too.

As an enterprise software and supply chains solutions provider, Chelford's products have historically been based on SAP technology, but the purchase of Shian in October has given the group a Microsoft-based offering for the first time. This is important, says chief executive Trevor Lewis, 'because some customers will only be interested in buying a Microsoft solution'.

In addition to this the company has snapped up Agility Systems, which addresses the supply chain sector via the provision of radio frequency identification (RFID) technology. 'We recently installed an RFID-based parcel tracking system for Geopost,' notes Lewis, 'and as the cost of the basic technology is plummeting I think the market is starting to take notice.'

Growth has brought its own strains. In the second half of last year, for example, the company was forced to outsource a considerable amount of work to satisfy customer demand at the expense of margin. Lewis insists this problem has now been resolved and with the shares trading on a prospective p/e of 11.5 (given forecasts of a £2.4m profit and 24p of earnings next year) Chelford remains good value.

Elliott Davis
Market cap: £21.0m
PE Forecast: 11.5
Share price: 277p

[tole] 10/4/2006 10:29

Armshares view this weekend.

The final results to December 2005 showed sales of £14.5 million (2004: £11.85 million), pre-tax profit of £1.4 million (2004: £1.0 million) and adjusted EPS of 19.99p (2004: 14.68p). The company reported that £355,000 of costs on a new SAP based solution for grocery distribution had been capitalised - this will be amortised over a three year period from initial sale; year end net cash was £869,000.

Research Standing
No question about it, the most recent reports pitch Chelford right back into play.

[this_is_me] 08/4/2006 12:01

Sales and profit are increasing at this well run company so in the long term we are on to a winner. In the short term the share price might not go up the way we think it should.

[silverfern] 07/4/2006 23:47

Amen to that, but announcing a dividend would have been nice

[alexandrews] 06/4/2006 22:46

silverfern,

All share price movements are pretty incomprehensible. I expect some pretty sharp minds have spent considerable amounts of time trying to develop some sort of formula to understand it, but I suspect it can probably be explained only by Chaos Theory 8-) Technical analysis tries to explain and interpret the movements, but its several orders of magnitude more difficult than fundamental analysis, IMHO.

Alex

[silverfern] 06/4/2006 22:05

I cannot for the life of me understand the way the share performs- I can very easily understand and grasp the business fundamentals and performance that drove and drives this company into profitability and acquisitions. However, to be me and therefore politically incorrect, this is a good-looking woman that is kept at home and can only dream of attention from other suitors. The company should spend some money on PR if it cares about it s owners - which include us. Have we told them that? They are now a success story without either buyers and sellers - of course there is no option left for those that move this market to do but widen their margins and create volatility.

[alexandrews] 06/4/2006 21:47

If we all sat tight on any shake, this share would fly.

If nobody ever sold any shares, the price would inevitably rise, but that's akin to some sort of pyramid scheme. There will always be sellers, whether it be to take profits, cut losses, or a myriad other reasons. It's just human nature.

If you've been investing for several years, you should have some sort of handle on how the market works by now! 8-)

Alex

[this_is_me] 06/4/2006 20:22

Some people may have waited for the new tax year to take profits as they may have used up their CGT free allowance for last year. There is the usual habit of 'sell on the news'; something that I have never fully understood.

It could retrace to the 260p - 265p region.

[pc4900074200] 06/4/2006 20:13

I am beginning to wonder if we are victims of our own
success. I wonder how many shares there out there to
be bought. With only 7.11m shares in issue and if my
memory is correct, many are held by Directors and employees.
This share is shook from pillar to post each time shares are
required for buyers.

Take today? Take a look at the download data [not
the trade's page]. We have, 7.5k bought. 13.2k sold
and 19k under the ?

The last trade of the day is down as a ? not a sell. Is it
a good price for a large buy? and take note, it's a late trade,
but not marked as late.

4 T trades, two at above mid. price, one just under the
buy price and the last at bid.

One late trade show's that they paid just under top dollar,
and with a trade of 5.5k which is a buy, should have sent
the share price steeply upwards at 15:49.

So, there have been more shares bought than sold, but
we have dropped 4.8%.

The MM's are crying out for shares to cover any
buying that comes in. That is IMO why they hit this
so hard on small sells, the shares are not there for
them to sell.

Long termer's should know the score by now and
not be panicked when the share plummet's as it has
today.

Yes it was the last of the 2005 / 2006 tax year yesterday
and there could have been people sitting on a profit
like I posted, I hold, the other day. Who's to blame
them for selling and taking profit at the end of the tax year,
but that was yesterday and the share took a fall for that.

Today's trades should have took this through the #3:00
mark.

Having held these for several years and seen many
build-up's to results and the aftermath following
statements giving steady and upwards progress.
It is IMO the answer to why this has not broken
out and advanced in price is the fact that they can't
cover any sustained buying so they fake a large drop
on a few small sells

Look back over the last few months. They sometimes
start the day with a large downward shake and out
comes a few sells and they have covered themselves
for the odd few buys. They have been repeating this
pattern every few weeks. Driving down the share,
trying to cover themselves for if they get a buy order
in.

If we all sat tight on any shake, this share would fly.

Just IMHO, any thoughts from others?

pc

[bernieboy] 06/4/2006 16:37

What a surprise the traditional post results pull back!!

[tole] 06/4/2006 13:32

Yep - still keen here myself.
Charles Stanley note out and they see plenty of earnings growth for 2006, noting the full contribution effect of Agility and Shian on eps. Currently rate it a strong buy.

CHR currently on a PEG of 0.23 and PE 12.2x - well under the sector average of 18x

[bernieboy] 06/4/2006 09:58

Results look good, cash generating, good strong buy. But we may see a slight pull back from here over the coming weeks. Normally do. Anyway - I am waitign for that £4 plus figure when I shall re-assess, any weakness now should be used to top up!

[aspex] 06/4/2006 09:30

Perhaps there a few impatient holders who will drop the price a little today.
It would have been nice to have at least one new customer or at least clarification of extension within the customer base.

[this_is_me] 06/4/2006 09:20

I think the results and forward statement are excellent. They show that the company is making very good progress and that it is a sound investment in both the short term and the medium term.

[tole] 06/4/2006 08:52

Yep still too cheap at this level. Currently waiting on the new broker note from CharlesStanley which should be later.