Datong Electronics Share Discussion Threads

[hastings] 07/2/2011 12:41

Very quiet here, no bad thing though i guess!!

[hastings] 05/2/2011 16:02

Really like the look of these and very surprised at the tiny market cap.
Appear to have already returned to growth and I would have thought that Canaccord's EPS of 9p for next year was certainly achievable.
I see that the CEO, who appears to be making all the right noises, has been talking about an acquisition and that wouldn't do them any harm at all.
Interesting too, to note the large Institutions holding here, certainly not many shares around, hence the wide spread. No doubt any good news and the shares will jump...significantly.


Shareholders

Shares in issue: 13.8m 0.5p Ords
Major Shareholders Amount % Holding
Investec Bank (UK) Ltd 6,349,396 45.90
Gartmore Investment Ltd 1,017,594 7.36
Hazell Carr Edwards FURB 830,000 6.00
Unicorn Asset Management Ltd 781,250 5.65
Artemis Fund Managers Ltd 585,938 4.24
Close Brothers 468,750 3.39

[alter ego] 03/2/2011 12:54

oh, I hope so.

[longshanks] 03/2/2011 12:05

[or well timed ;)]

[alter ego] 03/2/2011 11:47

puts my 3k yesterday to shame

[longshanks] 03/2/2011 11:28

Relatively chunky 54K trade today....smells like Directory buying to me.

There was buying around this time last year so I wouldn't be surprised to see it again.

[longshanks] 31/1/2011 10:10

Good analysis smarkmmm.

The Investec stake is reassuring on one level whilst worryingly high on another.

They could be looking for a trade sale of the business to realise their capital - or alternatively they could look to sell off chunks of equity to institutional investors once certain psychological hurdles like this court case get cleared off the books.

The company is in a growth market - and the shares should be well sheltered from wider market turmoil. At present they are far too cheap - Investec will be looking for £1.50/share IMO and my guess is we will see a steady appreciation in value to that point.

What we may see is that once the price goes above 80/90p - the likes of Cobham and Digital Barriers may be kick started into a bid at around £1.30 - but they know too well that a bid of say £1/share right now would be rejected by Investec.

[smarkmmm] 29/1/2011 19:03

Share price now back to the level the day before the results of 7 December - a 16% pull back from the intra-day high of 68/63. Now cap'd at 7.6m with 2.6m of net cash - ie an EV of 5m for historic sales of 14m, and 16m forecast for next year.

Coe Group, in the same field, was taken over by Digital Barriers (DGB) for an EV of 0.9x sales, and other takeovers of surveillance hardware companies have been as high as 2.6x sales. MMI taken over by Cobham for 1.7x sales.

Investec have 46% of the shares and will surely look for an exit at some point.
In November Investec arranged a £30m placing for Digital Barriers for aquisitions in the area of "digital security and surveillance technology".

The market is valuing this company at little more than net assets exc. goodwill as though the technology is obsolete, and yet £2m spent on R&D each year and sales were up 80% last year. US sales coming back after the release of government budgets and typically make up 50-60% of total revenue.

PSR 0.36x; Forward PE 6x; EV/ebitda c.2x.

Company has court case ongoing (though provision has been made) and has been accident prone in the past, but a cautious market allows an entry at a bargain price.

DYOR

[smarkmmm] 17/1/2011 20:04

My mistake!

I misread the date in "John joined DATONG as Group Sales Director in January 2010" for 2011. The statement makes more sense now!

Anyway, what's important is that Datong must have been impressed with his ability in the last 12 months to appoint him to the board.

[longshanks] 17/1/2011 16:53

Yes - you could be mistaken into thinking that sales of these high tech goods took years to build up!!

The interesting aspect is that John Kirtland comes from Quadrant Security - where he was Group Sales and Marketing Director. They are a subsidiary of AIM listed Quadnetics (QDG).

There is more to this appointment than meets the eye I believe.

[smarkmmm] 17/1/2011 15:27

"...his contribution since appointment earlier this year has been influential in our record order intake and sales revenue"

What, in 2 weeks?? Some sales guy!

[longshanks] 14/1/2011 13:44

bit of activity today...

Welcome to DATONG ashtree2. Always difficult to get over that psychological barrier of buying a share that has been through a price hike. However I think the recovery for DTE is still just underway and should be supported by institutional buying up to £1.20 IMO.

[ashtree2] 12/1/2011 11:12

Bought 1k's worth at 60.25 .Will wait and see before I invest more.

[owenski] 10/1/2011 09:58

Not a holder here, can any longer term holder tell me anything about the high 500k vol trades back in July 2010.

Thanks

[longshanks] 10/1/2011 09:32

possibly but I wouldn't preoccupy yourself with it. Gartmore have realised a profit on some of their shares but if they sold there also had to be a buyer. Liquidity is so low for DTE I doubt it was the MM's doing Gartmore a favour.

[ashtree2] 08/1/2011 07:02

Looking at this one,Gartmore has sold 531,000 shares if my calculation is correct,that is 3.84% of the company's shares.Would that mean that there is an overhang of shares currently? My worry is that Gartmore may choose to sell more of its holding.

[philjeans] 02/1/2011 12:51

smark - many thanks for that. Not a vast readership I imagine but good to know it's being recognised as a good growth stock.

Holding tight for 2011 here.

[smarkmmm] 02/1/2011 11:18

A New Year tip for Datong, for what it's worth, from the Yorkshire Post!

[rainmaker] 16/12/2010 23:04

Guys, I wouldn't worry about a fund manager selling. Research has shown that the number of fund managers outperforming the benchmark index each year is roughly equivalent to someone correctly calling the toss of a coin.There could also be a non stock specific reason for the fund manager selling.There are very few exceptional fund managers with a great long term record that you should take notice of. Most so called active funds whose obvious is to outperform the market, are essentially just pseudo trackers.

Talking of tossing coins, has anyone read the Intelligent Investor by Ben Graham?Although he isn't credited as the co-author, Warren Buffett had a significant input in this book.I recommend that you buy the book or at the very least, borrow it and firstly read the speech that WB gave to investors in 1984 at Columbia University to commemorate the fiftieth anniversary of the Intelligent Investor-The Superinvestors of Graham-and-Doddsville. Buffett talks about the efficient market theory that in it's semi strong state says that all publicly available information is automatically and instantaneously absorbed into a share price. He then goes onto comprehensively demolish this theory through the use of an imaginary American coin flipping contest.

regards

[longshanks] 16/12/2010 22:42

Gartmore bought a lot of shares in 2009 at prices between 25p and 35p. They are taking profits at this point - possibly offloading all of their holding.

This may put some weakness on the price - but now that the company has been derisked - I am sure that Gartmore are finding plenty of willing buyers too - so we may see an easy transfer of ownership.

[owenski] 16/12/2010 21:44

Gartmore were selling down another Co this week too, think it was CMS and I wondered about their timing on that one. Glad they dont run my funds.

[smarkmmm] 16/12/2010 19:53

Think you'll find they've reduced their stake to 7.356% by selling about 508000 shares. Personally think they've sold out too soon & Gartmore don't have great track record anyway....

[philjeans] 16/12/2010 19:37

Looks as if Gartmore have increased their holding from 5% to 10%.

Fantastic news.

[philjeans] 09/12/2010 12:02

Very little stock available; a few BUYS and they'll be flying again.

[longshanks] 09/12/2010 06:31

Given that brokers are sometimes overly conservative - I would say that 70p is probably a fair target for DTE. Until we get the next interims, the current recovery could be seen as quite fragile.

However - for those who are convinced that the recovery is actually quite strong and that DTE are well placed to build substantially on these figures - this gives a decent buying opportunity.

Dean Blood appears to be developing into a class act as a CEO. I think it is only a matter of time before the turnaround he has orchestrated starts being recognised and the city buys into the business as a good growth engine.