Cordel Share Discussion Threads

[rochdae] 13/11/2024 07:25

Excellent stuff. Two new customers. Hopefully, clocktower, investors didn't take your suggestion to take profits last week, or indeed not to buy at the raise price of 6.5p some weeks ago.

[myn0k] 13/11/2024 07:22

Two in one. Very nice

[clocktower] 13/11/2024 07:11

Yes that is really good news but they have not put a value on the contract, so I assume it is a trial as they go on to state their hopes.

Still the MM will mark it up and we should see a good rise with luck.

[srpactive] 13/11/2024 07:06

Excellent rns, two new customers UK and Australia.

It does appear we are starting to be the first port of call for
assistance.

Hopefully back through 8p.

dyor

[indalo] 09/11/2024 16:07

Chunky exchange yesterday at mid. Will be interesting it draws an RNS on Monday.

[74tom] 09/11/2024 13:10

Hang on a minute.

They pre announced the results on 23rd July & you made several posts in the days following which were all positive... I.e.

"columbarius26 Jul '24 - 17:26 - 901 of 1068
0 0 0
The 200dma has been dropping for three years. Another US contract will do the trick. As Sam King once said, a change is gonna come…"

So are you admitting that you are an ambivalent amateur or is it more a case of the pot calling the kettle black?

It's particularly ironic because they did actually win a new US contract a few days later

Presumably you think you can talk down the share price & are so passionate about it that you log in at 3.22am...

45% revenue growth, a spate of new contracts and building momentum. Curious time to flip negative ;)

[columbarius] 09/11/2024 03:22

The new rampers' thread has tumbleweed blowing through it. I prefer facts to a story stock narrative.
I find the ambivalence towards the revenue miss amateurish. The chief revenue officer was granted a significant number of options conditional upon achievenment of the FY24 revenue target. As the company has not acknowledged the failure of the target, will the options be vested? They have a track record of administrative 'hiccups' with regard to reporting of options.

[srpactive] 08/11/2024 18:01

74 working for someone probably. Big volume again. At 675p I wish.dyor

[indalo] 08/11/2024 15:06

I don’t mind if contracts come now or in the spring. This is such an illiquid stock you have to view it as a long term investment. It would be good to see big director buying based on the excellent results, Rathbone injection and the strong outlook. Now results are out there’s nothing stopping them unless there is further price sensitive news on the way……and I’m not suggesting there is, just saying it would be great to see one or other…or both 😀

[74tom] 08/11/2024 09:48

I actually find the naysayers here quite intriguing.

Why are they trying so hard to talk the business down?

I mean there is clearly momentum right?

They have 2 large US deals, have broken into Mexico, are entrenched with Network Rail & Angel Trains in the UK, have a cornerstone partner in Australia & very recent signs of life in APAC & the Middle East.

The solution is sticky, high gross margin & scalable.

Right now they have to continue to aggressively build out the product and land grab, both of which they have done over the last year or two.

At £14.5m valuation it's got a lot going for it...

[clocktower] 08/11/2024 08:57

Interesting views folks but the market seems to have made it's mind up for the time being. With Christmas around the corner and Trump about to take the reins in Jan 2025, I guess some folks that paid under 6p for the shares will be taking the cash back out, and others that paid almost 8p might cut losses impo.

So we will see which way it goes, but I will be surprised if any big new contracts are signed before the new year, or even Spring 2025.
DYOR

[rochdae] 08/11/2024 08:10

The reason for a £300k undershoot in expectations is probably because business is not an exact science.
But Cordel is a good business growing rapidly. Growth of 46% is fine with me. That trajectory has been mentioned by the company, but if that drops to 40% I don't really care.
If you have no faith in management, you shouldn't be invested.
And I repeat, 20 to 24 months is short term, not long term as suggested on here.

[columbarius] 08/11/2024 07:50

Sure it's an estimate, but it's the company's estimate and I'd rather take note of that than your projection.

The forecast could be beat but recent evidence is that they miss forecasts. Look at the trading update of 2nd April. They say they're confident of achieving their revenue target which was £4.7m. They missed it.

Normally when a company puts financial guidance in the public domain they provide an explanation when they come in under. I've known some of the worst dogs on AIM front up to investors when things haven't gone as expected. I've been through Cordel's report and there's nothing on why they failed to meet market expectations. I think they sweep such things under the carpet in the hope that nobody notices.

I doubt if the miss was due to some revenue being pushed back into this financial year because, as I pointed out above, the FY25 target has been cut by a bigger percentage than the FY24 miss.

[rochdae] 07/11/2024 18:20

I've been reading broker forecasts for 30 years. They are an estimate. What happens if there is a significant contract, or a loss of one? As you point out, they have already changed their view.
Anyway, Cordel on a clear growth trajectory with 10 million revenue. I don't see this as 'long term' is my point.

[columbarius] 07/11/2024 18:02

Best to get the revenue targets from house broker Cavendish. You're making up that growth trajectory.
Cordel's revenue targets were FY24 £4.7m FY25 £7m FY26 £10m
Since September 2024 it's slipped to FY24 actual £4.4m FY25 £6.2m FY28 £10m

Cavendish Initiation of Coverage 26th September 2024:
"We establish an initial 11p TP based on FY28E £10m revenue"

[rochdae] 07/11/2024 17:22

According to market screener it's 6.6 million. They were correct with 2024 estimate.


Even at 6.2 million this year with a growth trajectory of 46% that's 9 million in 20 months.

That's assuming no acceleration in positives.

[columbarius] 07/11/2024 15:13

Revenue for FY25 isn’t estimated at £6.6m. The target was £7m but that was cut back to £6.2m in September. The FY26 target was £10m but Cavendish pushed that out to FY28 so I think your FY26 £9.5m is wishful thinking. The CEO said they might do £10m by FY27 or FY28.

[rochdae] 07/11/2024 12:18

There have been about 9 positive RNS announcements (excluding successful fund raising) since Jan 24, so around one every month. The suggestion we'll have to wait some time for the next one doesn't ring true. And taking profits now is probably just as flawed as trading the last raise assuming you could buy back cheaper.

I also don't see this as 'long term'. We are 4 months in to the new financial year with revenue estimated at 6.6 million. The following year with 45% revenue growth takes us to 9.5 million - around 20 months. So quite 'short term' imo.

For longer term stuff this was an interesting comment from the results:

'Cordel is seeking to establish a strong business in rail before expanding into road and energy infrastructure'

[74tom] 07/11/2024 11:36

Not sure I've ever seen a UK small cap romp into the USA and start making tens of millions in profitable sales? Tracsis are trying at present but haven't made much progress.

Amtrak was the key win in that it is a tier 1, I would guess that success there gives them a lot more credibility with new customers? The 2021 Union Pacific RNS said it was a paid project, so the result may have said come back when your solution is more advanced and we'll discuss further? We just don't know.

Americas sales were £187k in 2022 growing to £1.1m in 2023 and £2.02m in 2024. That's quite impressive. I note second half margins were 72% which is moving in the right direction too, costs slightly higher than forecast but nothing material.

Another couple of wins in the near term and I think there will be more interest here, especially if they are long term contracts.

[columbarius] 07/11/2024 10:23

indalo, I agree Cordel are bullish on the USA pipeline but they were equally bullish way back in June 2021 (see below) and have only added two customers. The CEO is on record saying achievement of revenue targets will be driven by growth in the USA, but the evidence of the last four years shows progress there is much slower than expected. Why didn’t they explain to investors what happened to the important Class 1 Union Pacific contract? I feel they have a tendency to sweep inconvenient truths under the carpet in the hope nobody notices.

RNS 23 June 2021

“ Nick Wayne, Vice President Cordel USA, said:

"We are proud and excited by the achievements of our team to date, with first revenue now being received and a solid opportunity pipeline now in place for the coming financial year. Above all, we have proven that our technology is both applicable to USA conditions and more than competitive in terms of results, speed and cost."

Nick Smith, CEO, Maestrano, said:

"The USA market represents over 38% of global expenditure on rail asset management. It has been a core focus for Cordel over the past year and we have moved from the proving to the early revenue stage. Whilst this has taken longer than expected, we are now positioned for a significant growth opportunity."

[clocktower] 07/11/2024 09:04

Withour a RNS of new contracts, boredom will sink in and the reality will sink in, and those left holding anything more than a token amount may well just watch it sink back below the price it was before the raise impo.

Still the long term prospects still remain good for the company but profits may be elusive, as far as shareholders are concerned.

DYOR

[2vdm] 06/11/2024 20:36

Thanks Indalo. A good post and I agree.

[clocktower] 06/11/2024 20:32

columbarius remember - Stay away from a fool, for you will not find knowledge on their lips.

[indalo] 06/11/2024 20:27

What you are touching on is the biggest challenge for a company like Cordel, operating in a traditionally slow moving industry (excuse the pun) with a level of customer inertia…I̵7;ve been in a similar position in my previous business where we had excellent product market fit but were way down the clients’ list of priorities. However, other contracts have followed with a year between the completion of a trial and the initial contract, as highlighted in the Cavendish note. A lag is clearly not indicative of a lack of commercial traction.

Additionally Cavendish note that they expect an increase in contracts without a poc/trial due to the increasing references available in the market for the product.

Also I note the very strong statements in the annual report that they have a ‘very strong pipeline’. I’ve thought a lot about this point, and FWIW I believe they have many active discussions underway and I do expect to see a good flow of conversions to POCs or direct to contract, including among the additional six tier 1 US networks referenced in the annual report.

At the end of the day you have to decide whether the revenue plan is credible. My money is on it being not only credible but conservative. If you triangulate the known contracts and extensions in the Cavendish paper with this year’s £6.2m revenue target you can get there before adding any incremental business which may go straight to contract in the remaining 8 months of the financial year. A couple of big ones, with one of two use case cross sells would set them up for the £10m short term target in FY27, a year ahead of the Cavendish assumption.