Conduit Share Discussion Threads

[madengland] 30/4/2014 10:04

Looks good Riv. I always feel those late in day multi large volume trades are a good sign of an imminent move one way or the other. Feels like up is the likely direction this time.

[rivaldo] 30/4/2014 09:31

New highs, and looking good online - you can only buy a maximum 7k shares at the full 115p, but you can sell 10k at a premium at 114.2p.

[madengland] 29/4/2014 17:31

Bit of stock being moved around late in day as expected.

[madengland] 29/4/2014 14:45

Interesting to see lack of sells after a good few days run up. If anyone is stake building and was hoping for a bit of weakness today it's not there. Wouldn't be surprised to see a few buys near end of day and a jump. We shall see

[madengland] 29/4/2014 13:12

Thanks Riv. Hnt getting dumped today. Suggest their holders pick up CRE

[rivaldo] 29/4/2014 08:14

CRE was tipped as a Buy yesterday as follows FYI:



"Creston - Trading update
1 Days ago (2014-04-28 12:45:32)

Marketing services company Creston (CRE) has announced in a brief update that following an improved second half performance it expects revenues and headline profits to be in line with consensus for the year to March. Revenues will be £74.8 million, down slightly from last year's £75.2 million, with cash (excluding deferred consideration) ahead of expectations at £7.5 million.

Creston has also announced that David Grigson, Non-Executive Chairman,will be stepping down following the firm's AGM on 8th September. He will be replaced by Richard Huntingford, a member of the Board since September 2011. This follows news earlier this month that Kathryn Herrick, former Vice President Finance for Europe, Middle East and Africa at technology firm Equinix, will begin as Chief Financial Officer in July. She replaces Barrie Brien, who took over the CEO role at the end of March from Don Elgie.

A brief but reasonably encouraging update from Crestion. In particular we note that the update implies revenues growth of 1.1% in the second half, which is a good sign after the firm posted a 4% revenue fall in the first half of the year. While the current management changes are not fully implimented yet we would hope to see further comments on strategy from the firm when results are released on 11th June.

Valuation...

Creston shares have recovered since the disappointing performance at the interims, and at the current 111.75p the firm is capitalised at £67.4 million. Of course, a fallback in the economy remains one of the key risks to the investment case, as are the loss of major clients and the volatility in marketing budgets. However, we note that Creston appears to be benefitting from trends recently reported in the recent IPA Bellweather report, which reported that marketing budgets in the UK saw their biggest increase in 14 years in Q1 2014.

The markets are now looking for pre-tax profits of around £9.4 million for the full year just finished, which implies an earnings multiple of around 9.9 times. The implied yield is 3.2% given the interim payment of 1.2p per share and that the firm is now looking to move towards a one-third/two-thirds dividend split. On balance, we believe that Creston remains one of the more solid firms operating within the industry and one of the cheapest in valuation terms. "Buy"."

[rivaldo] 28/4/2014 15:53

Yep - there's the new high Mad.

Lots more to come imho.

[madengland] 28/4/2014 15:46

Happy days coming Riv, me thinks

[rivaldo] 28/4/2014 15:41

Heading for new recent highs.....

[rivaldo] 28/4/2014 13:36

:o))

With the World Cup this plus various elections and referenda and an economic recovery, this year should at the least be a decent year and at best could see an explosion in PBT for CRE given the overheads that have been taken out of the business and the new accounts won.

Here's news the UK ad spend rose to £17.9bn last year and recovery is set to continue with a 5.5% increase this year and a 6.5% uplift in 2015:



"The forecast explosion in mobile advertising and digital formats points to UK advertising at the centre of a global revolution in consumer information, service and choice," said Advertising Association boss Tim Lefroy

[madengland] 28/4/2014 09:37

I think your initial price target around 150p Riv sounds good. Could be a sector re rating also.....it's been a long time since we had a boom so maybe peeps are slow on the up take

[rivaldo] 28/4/2014 07:34

Looks like boom times now in CRE's sector:



"17 April 2014 - 6:03am | posted by Jessica Davies | 0 comments

IPA Bellwether: Marketing budgets see biggest surge in 14 years with traditional media outstripping internet spend for first time in 3 years

Marketing budgets have seen their biggest increase in 14 years, with almost 30 per cent of companies registering an increase in budgets during the first quarter of 2014, according to the latest IPA Bellwether Report.

This is markedly higher than the fourth quarter of 2013, during which only 11 per cent of companies listed an increase in marketing budgets, with 12.3 per cent the highest for the whole of 2013. Nine per cent of companies registered a fall in marketing budgets, which, along with the 30 per cent that cited an increased, resulted in a net balance of a 20.4 per cent quarterly rise.

The Q1 2014 IPA Bellwether Report, published today (17 April), revealed the "record" increases completed the end of six consecutive quarters in which marketing budgets have been "revised up".

The sustained period of increases throughout 2013 and the first quarter of 2014 has resulted in marketing executives recording a net rise in budgets for the year - for the first time since 2006. An average 17.2 per cent of companies reported a budget rise - smashing previous annual forecasts.

Rises were logged across all categories of marketing, with traditional media advertising seeing the biggest hike, outstripping internet investment in the first quarter of 2014, for the first time in almost three years.

However, internet advertising budgets also saw a quarterly rise, although the net average spend dropped 8.5 per cent in the first quarter - down from 9.2 per cent in the fourth quarter of 2013.

Paul Bainsfair, IPA director general said: "With confidence remaining strong, forecasts revised up higher than ever before, and budgets being increased to the highest degree for seven years, the Q1 2014 Bellwether Report reveals that both the advertising industry and the wider economy are facing a future full of opportunity, innovation and most importantly of growth. This is a very good place to be. All very good news for the Government in the run-up to an election year."

Meanwhile companies' overall optimism regarding their financial prospects was deemed "historically high" by the IPA, and that combined with recently published data on the recovery of the UK economy by the Office for Budget Responsibility (OBR), has led to 40 per cent of marketing respondents anticipating a further rise in marketing budgets.

Chris Williamson, chief economist at Markit and author of the Bellwether report said: "The spring Bellwether Report reveals the most upbeat assessment of business and marketing spend that we have seen since starting the survey back in 2000. Last year saw the biggest rise in marketing spend since 2006, and 2014 looks set to be even better.

"If the initial increase in budgets for the year being the strongest since 2006 wasn't already enough, the fact that companies have already revised these budgets higher to an extent not seen in the 14-year history paints a remarkably buoyant picture for the rest of 2014.

"Companies are ramping up their markets and advertising expenditure in the face of growing optimism about the economic outlook. As higher marketing spend is also usually accompanied by rising business investment and job creation, this augurs well for economic growth to top 3.0% this year.""

[madengland] 27/4/2014 11:50

Yes Riv I've not flicked through any weekend papers, but it looks good for a tip and an IC or share mag update and tip. Fingers crossed

[rivaldo] 27/4/2014 07:50

:o))

Wouldn't surprise me to see CRE tipped given the P/E of only 8.8 and a 3.8% dividend yield.

Which with very little stock apparently available may have a decent effect on the share price.

[madengland] 26/4/2014 13:16

That's a bit fishy

[harry the haddock] 25/4/2014 14:13

struggled to get £2.5k this morning

[rivaldo] 25/4/2014 13:31

..and buying now coming in at the full 113p offer price.

[rivaldo] 25/4/2014 10:31

....backed up by the very good looking online situation.

At present you can only buy 5k maximum at the full 110p offer, but you can sell at least 15k at the 109.5p mid-price....

[rivaldo] 24/4/2014 23:02

Interesting trades reported, with a 100k buy at the full 110p offer and a late buy of 20k at 110.23p, above the 110p offer price. Plus sells are achieving almost the mid-price.

I'd say there's some stakebuilding going on.

[rivaldo] 24/4/2014 08:36

Singer's have kept with their Buy rec and 119p price target for the moment, though I suspect that in the run up to or after the finals in June they'll raise that price target.

With trading looking good I can see CRE trading at around 145p-150p based on 12.4p EPS. i.e a P/E of around 11.7, and the 4.1p forecast dividend will ensure institutional support:

"N+1 Singer stuck with its "buy" recommendation on communications group Creston (CRE), leaving its target price unchanged at 119p. The broker notes the firm's trading update which was released today and is encouraged by the fact that all divisions traded ahead of its own expectations as the impact of recent contract wins begin to feed through. N+1 Singer did acknowledge that the shares have recently recovered from their December-low but insisted that they remain cheap. The shares inched upwards by 3p to 109p."

[madengland] 23/4/2014 18:34

Thanks Riv, for both posts. Looks good, external and internal falling in line on a share that is very undervalued at present. Let's see what BB does.

[rivaldo] 23/4/2014 12:40

Edison have a new note out today:



They forecast 12.4p EPS and a 4.1p dividend this year, which makes CRE look very undervalued imho on a P/E of 8.8, a divi yield of 3.8% and with a £7.5m cash pile - as they themselves note in their conclusion:

"Valuation: Discount remains substantial

The share price remains at a substantial discount to the sector of 35% on a calendarised 2014 P/E and 31% on EV/EBITDA, which is primarily a reflection of the current earnings plateau. Clarity on the strategy for moving profits and earnings ahead and delivery against market expectations, as well as a continuing strong net new business win position, will help close the valuation gap."

[rivaldo] 23/4/2014 09:04

Madengland, I remember reading a while ago that the average P/E in the media sector was around 18, whilst the average divi yield was 3%.

CRE's P/E of 9 and 3.6% divi yield has a long way to catch up, particularly in an improving economy and with a bumper year coming up for advertising with the World Cup - and the European elections and the run-up to UK elections for ICM.

[madengland] 23/4/2014 08:31

Hi Riv, yes pleased to read. Any idea of the sector PE?

[rivaldo] 23/4/2014 07:09

Excellent news from today's year end trading statement:

- in line with 11.2p EPS expectations, leaving CRE on a P/E of just 9.5
- with a 3.9p forecast dividend
- and a £7.5m cash pile, ahead of expectations

"Barrie Brien, Group Chief Executive, commented: "I am pleased with the second half performance in which we have achieved revenue growth over both the first half and the same prior year period, putting us in line with consensus. Following the busy period of pitching in the first half of the year, new business wins had a positive impact as expected"."