Discoverie Share Discussion Threads

[f1araway] 11/1/2018 14:24

Looking forward to the presentation on 25th January.

[rivaldo] 11/1/2018 13:48

New highs today at 394p, with AT trade (institutional) buying coming in at 395p now.

[soundbuy] 09/1/2018 10:42

Fair churn this am.

Sizeable trades at offer.....

[rivaldo] 09/1/2018 07:37

Welcome Courant, good to see another respected investor here on this quiet thread :o))

DSCV have won an award - best small/mid-cap company of the year at these quoted company awards:



Small & mid-cap company of the year [top]

discoverIE (formerly Acal)

Under CEO Nick Jefferies since 2009, discoverIE’s strategy has been to create a high margin differentiated business through organic and acquisition led growth. This strategy has delivered with sales doubling in the last four years. discoverIE, a leading designer, manufacturer and supplier of customised industrial electronics products and solutions, has focused on niche areas and also in the design to delivery processes. Cross selling opportunities has been a key factor in the acquisition strategy. The acquisition of UK based Variohm Holdings for £14m in January added a highly complementary business. Though the majority of revenues are in Europe, the company has been growing its presence in US and Asia, with the aim to become an international leader in customised electronics. The latest results showed 9% organic growth, and EPS up 24%."

[courant] 08/1/2018 15:23

I'm in here too, has a distinct hint of XPP in terms of the business model/dynamic (very positive in terms of long-term revenue/profitability growth and stability).

[rivaldo] 08/1/2018 10:24

DSCV are tipped here as a stock for 2018:



"Higher margins and a shift in focus to design and manufacturing inspired Acal to change its name to DiscoverIE Group – discover innovative electronics. But it’s not a funky new name that will decide the electronics distributor’s fate. Adjusted earnings grew by 24 per cent in the first half, on organic sales up 9 per cent; the firm has a record order book; and growth is underpinned by new project design wins. Look for a 20 per cent increase in 2018 profit and double-digit growth thereafter. A big valuation discount, compared with peers, should narrow."

[rivaldo] 05/1/2018 08:31

New highs now. This share is up almost 50% in the seven or so months since I bought in - which proves once again that the quietest threads are often the best :o))

There's still mucho upside here imo as:

(1) DSCV trades at a large discount to its sector and peers but is now rerating
(2) it's about time for a new acquisition or two,
(3) the pound is weak, which benefits DSCV's competitiveness and overseas revenues converted into sterling, and
(4) the general economic situation is stable/improving which obviously helps demand.

[rivaldo] 04/1/2018 08:30

Good news - Peel Hunt have today increased their target price to 450p (from 360p) and say Buy:



Happy New Year Soundbuy (and anyone else here on this quiet thread!). I suspect there's a lot of upside here this year and in the future as the transformation of this company takes hold.

[mfhmfh] 04/1/2018 08:29

Peel Hunt reiterates buy recommendation and increases price target to 450p from previous 360p.

[soundbuy] 29/12/2017 10:31

Cheers.......

[rivaldo] 19/12/2017 11:32

Indeed. Buying at 375p this morning.

[soundbuy] 18/12/2017 07:47

Alongside IOM having a cracking run ........patience paying off..... liquididty seems to be improving too

[rivaldo] 15/12/2017 16:04

Nice £128,000 buy at 365p has caused today's new highs (currently 370.125p mid-price).

[rivaldo] 14/12/2017 14:43

DSCV are presenting to investors on January 25th in London - just register here for free:

https ://www.proactiveinvestors.co.uk/register/event_details/125

Good to see the company being "proactive" and looking to expand their investor base.

[rivaldo] 14/12/2017 10:13

I missed this good coverage of DSCV's results with comment from two analysts:

http ://www.proactiveinvestors.co.uk/companies/news/187877/discoverie-s-price-target-lifted-by-finncap-on-back-of-sector-beating-growth-rate-187877.html

Extract:

"“We have many growth opportunities ahead of us as we drive towards our stated targets, and our ambition remains to repeat the performance of the last five years by doubling revenue and underlying earnings per share through a combination of organic growth and value-enhancing acquisitions," Jefferies said.

Broker Peel Hunt, which counts DiscoverIE as a corporate client, described the trading update as “excellentR21; and said there is plenty of momentum heading into the second half of the financial year.

“The group has also changed its name to discoverIE Group PLC, which we see as a natural, positive move that reflects the evolution of the business from distributor to designer and manufacturer,” Peel Hunt noted.

DiscoverIE stands for “Discover innovative electronics” and follows on from the recent FTSE reclassification of the stock to the Electronics and Electrical Equipment sector.

Adjusted profit before tax of £10.4mln was a shade above Peel Hunt’s forecast of £10.3mln.

The broker left its full-year forecasts unchanged, following upgrades in April and October, but said there is a chance that it would be revising them upwards again before the financial year is done.

“Net debt at 30 September was £37.6mln, down £3.5mln YoY [year-on-year], which equates to 1.3x pro forma EBITDA [underlying earnings] and leaves plenty of firepower for further bolt on acquisitions, the pipeline for which we understand is looking healthy. Absent any deals, we’re forecasting net debt to reduce to c£27mln by the end of the year,” Peel Hunt, as it reiterated its ‘buy’ recommendation.

“On a PER [price/earnings ratio] of 14.5x Mar18e [forecast earnings for year to March 2018] and a dividend yield of 2.8% we think the shares are significantly undervalued,” the broker said.

Shares in the company rose 2p to 320.25p on the results; Peel Hunt thinks they could hit 360p in the next 12 months.

The price target is even punchier at finnCap, which reckons the shares are worth 405p – up from its previous target price of 339p.

Even at that valuation, the stock trades on a 15% discount to its peers, despite the prospect of faster growth, finnCap noted.

The stock is currently trading at a 37% discount to its peers, but finnCap expects this discount to narrow.

“The outlook is positive, evidenced by a record order book (+16% at CER [constant exchange rates]), and investment has consequently been made into working capital. Of particular note is a 30% increase in new project design wins, providing an expanding base from which to drive continued growth,” finnCap’s Guy Hewlett said."

[petewy] 13/12/2017 10:26

Thanks Riv

[rivaldo] 13/12/2017 10:19

Good coverage of the new Berenberg note:

http ://www.proactiveinvestors.co.uk/companies/news/188648/discoverie-shares-strong-performers-over-the-last-year-but-still-plenty-to-go-for-says-respected-german-bank-188648.html?utm_source=Sign-Up.to&;utm_medium=email&utm_campaign=7163-371975-Proactivity+-+12%2F12%2F2017

"discoverIE shares strong performers over the last year, but still plenty to go for, says respected German bank
15:25 12 Dec 2017

The number crunchers at Berenberg believe the shares, currently changing hands for 363p, are worth 460p

Up 60% in the year to date and 140% over the past 12 months, it would be easy to assume shares in the electronics component business discoverIE Group PLC (LON:DSCV) are up with events.

But, according to analysts at Berenberg, there is still plenty left on the table for investors new to the story.

WATCH: DiscoverIE is the new Acal

Why? Well, the number crunchers at the German investment bank believe the shares, currently changing hands for 355p, are worth 460p.

Initiated with a 'buy' rating

Berenberg provided the valuation as it initiated coverage of the stock with a ‘buy’ rating.

It pointed out the company, formerly known as Acal, has ‘transitioned’ in recent years from commoditised parts to a design-led approach, which has boosted the business’ profitability.

Since 2011, EBIT margins have doubled to 6.2% and are on course to hit 7.5% by 2020 and 8.5% “thereafter221;.

However, Berenberg says there may be a way of accelerating growth via well-judged deals.

Fragmented market

It points out the £20bn market for customised electronic components is “extremely fragmented”, consisting of “many subscale designers that lack the distribution channels to unlock their full value”.

In fact discoverIE has tapped into these sorts of opportunities already, making 13 acquisitions worth around £150mln in the last eight years.

“It buys growing businesses, allowing them to operate in a decentralised structure,” said Berenberg in its note to clients.

“Meanwhile, it generates revenue synergies by offering them access to its distribution network of 25,000 customers.”

M&A scenario

Berenberg’s M&A scenario assumes the company has access to £200mln of debt that can be deployed over the next five years, which it reckons could yield an equity value of up to £530mln.

It also believes the discoverIE’s underlying markets have a number of long-term growth drivers, including increasing electronic content in products; shorter product life-cycles; and increasing industrial connectivity.

“In the near term, a buoyant Eurozone backdrop, coupled with revenue synergies from new acquisitions should drive growth ahead of the broader market,” it added."

[rivaldo] 12/12/2017 08:29

Nice - Berenberg have today initiated coverage with a Buy and a 460p target:



Clearly the City is beginning to "discover" (ho ho) this company as it grows and transforms. And as it does its rating will grow and improve.

[rivaldo] 08/12/2017 12:21

New Edison note just out FYI:



Interesting:

- DSCV trades at a 37% discount to its sector, implying a 564p share price
- "using existing credit facilities to make £50m worth of acquisitions could add 20-25% to FY19e EPS"
- which implies around 28p potential EPS for the year starting next April, even without any further organic upgrades

[rivaldo] 08/12/2017 07:22

Hi sharw, no problem - will do.

News here of DSCV's designing new wireless technology solutions for remote monitoring:



"Case study and interview – Remote monitoring in open water

Find out how Acal BFi’s flexible and creative engineering design approach helped support Thinnovation with an almost impossible set of design requirements for their remote monitoring solution, Remon.

The challenge

With sensors sending data to the Cloud from boats in the middle of a marina, Thinnovation’s Remon solution required data to travel up to 10km wirelessly. It had to be cost effective and operate for at least one year on battery power alone. It also had to be user friendly and scalable, allowing end-users to self-install the system.

The solution

Having considered multiple technologies, Thinnovation contacted Acal BFi regarding a relatively new wireless technology, LoRaWAN. To deliver all of Thinnovation’s requirements, Acal BFi provided complete design support to develop an advanced design with four wireless technologies that also brought new additional features and functionality.


The benefits

By working with Acal BFi designers and splitting the data journey into smaller stages, Acal BFi were able to suggest different wireless technology solutions, enhancing the software to provide an even better solution for Thinnovations’ customers.

Find out how Acal BFi directly supported this customer with the latest wireless technology in our case study, and hear how this advanced level of support benefited their design from Nic Burkinshaw, Director, Thinnovation, in our exclusive interview below."

[sharw] 07/12/2017 17:44

Yes, and the chart looks even better today but this is one of those shares where you have to stop and work out what is actually happening. Just before close yesterday the mid point was 355.875 (354.75/357) and today 353.125 (346.25/360) so that's down 2.75 right? Wrong - it is officially up 5 because there was ONE share traded in the closing auction yesterday at 355 and 75 today at 360 so that makes them the closing prices. Manipulation? Perish the thought.

It is also more difficult to follow trades because this one is also traded on NEX:



rivaldo - are you able to put that link in the header?

[soundbuy] 07/12/2017 13:36

Blinding current chart though :)

[davr0s] 05/12/2017 20:46

It's a shame we've lost the chart information under the previous name

[mfhmfh] 05/12/2017 10:48

from 04.12.17:

FinnCap retains 405p target price.

[rivaldo] 05/12/2017 09:36

New highs again this morning, with buying at 359.95p.

Nice article here:



"One growth stock I’d buy and hold for the next decade

Royston Wild | Tuesday, 28th November, 2017 |

I have long been a big fan of Acal (LSE: ACL) and, although the market has remained unmoved in Tuesday business, the company’s latest trading statement today has firmed up my bullish view.

The electronics builder and distributor — which from today will be known as discoverIE Group — announced that revenues detonated 21% during the six months to September, to £190.2m, a result that pushed underlying pre-tax profit to £10.4m, up 42%.

And discoverIE, boosted by a solid order book, is confident that it can continue making progress in the near term and beyond. Chief executive Nick Jefferies commented: “The second half has started well and we are on track to deliver full-year performance in line with our expectations, supported by a record order book of £111m.

“Together with an increase in new project design wins of over 30%, with an estimated lifetime sales value of over £90m, we are well positioned for continued growth.”

Meanwhile, discoverIE’s multi-year programme to boost margins by expanding its Design and Manufacturing arm is also delivering the goods. The company saw its underlying operating margin increased by 60 basis points, to 6.2%, during the first half.

Brilliant forecasts

It should come as little shock, therefore, that City analysts expect discoverIE to continue growing earnings at a terrific rate.

In the year to March 2018 a 10% bottom-line improvement is anticipated. And the good news does not end here, a further 8% advance predicted for the following year.

These current forecasts make the small-cap a brilliant value pick too. On top of carrying a forward P/E ratio of 14.4 times, it also boasts a corresponding PEG multiple of just 1.4.

What’s more, today’s release underlined the fact that discoverIE is a growth dividend share that investors should take notice of — the business hiked the interim dividend 8% year-on-year to 2.65p per share on the back of its strong results.

In fiscal 2018 the total dividend is expected to increase to 9.3p per share from 8.5p previously, City analysts are predicting, meaning that discoverIE sports a chunky 2.9% yield. And the yield steps to 3.1% for next year thanks to an anticipated 9.8p reward."