Enteq Technologies Share Discussion Threads

[simon gordon] 22/11/2013 11:05

Eezy,

If you read between the lines that RNS was a profit warning for 2015.

2014 is in-line.

2015 has gone from c.7.5p to c.5.5p.

They still have to prove up 2015, so 10x seems more than fair, which is were it's almost been de-reated to.

On a bad patch in the markets, and some dribbly sellers, you could see the 40's.

It's going to be very tough to see 70p for the foreseable future, only hope is a big Global order, but they're still not fully kitted up for this market.

Good fortune.

[eezymunny] 22/11/2013 10:11

I'd say forecasts for this year aren't that big a deal, so quoting your 69 PE is a bit amateurish. To make my point "A further competitor is APS, based in Connecticut, USA. APS has developed an MWD solution which has filled a gap in the market outside North America, especially as the Geolink product is no longer available. It is believed that APS has recently won a $100m supply contract to Venezuela, via a Chinese led integrated services package. This demonstrates the scale of the opportunities in Enteq's addressable markets. Enteq believes that its evolving solution will have technically differentiated features which set it ahead of APS."

So whilst I can't even begin to forecast whether NTQ will ever land such orders, simply quoting a current year PE is pointless IMO.

The continued director buying suggests to me that they are pretty confident of the outlook. They may be wrong! Only time will tell..

[eezymunny] 22/11/2013 10:00

Woodcutter you say "Many seasoned investors who frequent these boards and who i have a great deal of respect for have exited today for precisely that reason."

Well if they're so smart what was there in those numbers that caused them to sell that they didn't know about before the statement. The numbers were pretty much exactly what anyone who was thinking would have expected,no?

Be careful who you respect IMO!

Whether they "overpaid" for acquisitions remains to be seen I feel. They have bought products, brands, expertise, customer base and now plan to roll that out internationally. They may or may not succeed but it's far to early to say if they overpaid IMO.

[affc21] 21/11/2013 22:16

Thanks for the Finncap forecasts Simon.

[simon gordon] 21/11/2013 22:11

Finncap have them doing 9c (5.6p) to 03/15.

To 03/14 the forecast is 1.8c (1.1p).

[woodcutter] 21/11/2013 21:38

EM

why do you think i concentrated on the EBITDA eps? The bottom line is 2.8cents at the end of the year based on a further 100% increase in revenue is not sufficient to attract my interest and that continued revenue growth is unknown at present. Many seasoned investors who frequent these boards and who i have a great deal of respect for have exited today for precisely that reason.

Whilst it may well have great prospects they are exactly that, prospects. Even if they do 2.8cents, roughly 1.8p it puts them on a forward per of somewhere around 29. We are most likely toward the peak of the bull market, which at some point will make a significant correction, stocks on these valuations will get severly punished when that correction takes place, aimho.

btw I'm well aware of managements past history it was one of the points that developed my interest. On the point of goodwill, yes you make a reasonable point but in the context of what was previously paid for the businesses acquired they now look a little expensive, wouldn't you say!

It might take time but i can be patient and buy when it's well below the current share price

[simon gordon] 21/11/2013 19:54

Before today they were forecast to do 7.37p to 03/15. As Investec has downgraded, it could be down to 5 or 6p.

10x 2015 seems about right with the cash pile.

Can't see them getting to 15x until they start an upgrade cycle, which looks remote right now.

If anyone's got the new forecasts could you post them.

[eezymunny] 21/11/2013 19:22

Oh for goodness sake Woodcutter....

The amort charge is just acquired goodwill. It's utterly irrelevant (ask Warren Buffett).

Agree that they need to grow the top line - but these are experienced guys who have done that before and they are forging ties outside US, developing products etc. That takes time and only in time will we know if they are successful. It may well go wrong.

Just don't kid anyone that the loss after amort charge has any relevance. PLEASE!

Focus on the cash flow which was negative, but only to the tune of about $170k excluding w/c changes.

Another dir buy today I note.....

[woodcutter] 21/11/2013 17:56

I've been watching for a while after GHF suggested NTQ might be worth a view, been waiting for these results before making any further move.

There is a little operational gearing, comparing H1 this year to last year Revenues have grown almost 100% but admin costs only about 69%. The admin cost for H1 is also marginally lower than H2 last year. so they do appear to be trying to control costs.

If we extrapolate going forward the same rate of H1 growth in revenue and admin costs for the full year:

Revenue $21m at roughly 99/100% growth
Gross margin 43% (same for H1 and last full year)
GP $9.1m
Admin $7.4m at roughly 69% growth
EBITDA roughly $1.7m
D&A will almost certainly result in a loss.

shares in issue 58.95m
adjusted eps based on EBITDA about 2.8 cents.

There's a lot of big assumptions in there on growth and true earnings are likely to be negative too. I'm inclined to leave alone for now on the basis that i think it's expensive and overvalued. It would need to fall considerably further to attract my interest.

Woody

[eezymunny] 21/11/2013 15:31

I agree. "Opportunities in other global markets such as Russia, Middle East, China and South America remain considerable. Enteq is increasing the sales and marketing presence in these territories, developing partnerships and potential new customer relationships."

US sounds flattish for next few months but this feels like a company with great ambition in a big market.

Only time will tell...

[battlebus2] 21/11/2013 15:28

Some hidden trades i guess to be reported after the bell.

[norsewebster] 21/11/2013 15:24

Topped up. More buys than sells today. That can't be right.

[this_is_me] 21/11/2013 15:02

Me bought in this afternoon. It seems well oversold compared to the potential.

[cockerhoop] 21/11/2013 12:22

Some commentary from Chris Boxall at Investors Champion

hxxp://www.investorschampion.com/blog/entry/enteq-upstream-aimntq-interim-results-offer-promise-for-the-future

Perhaps a little dig at this mornings sellers at the end?

[stegrego] 21/11/2013 11:59

Agree that the business was bought right at the top of the market.

[simon gordon] 21/11/2013 10:41

GHF,

I'm not so sure about rating the management any more.

I think they bought XXT at the top of the market and wildly over paid, this is the main reason the share is 50p not 100p. They've now got a slog on their hands as they develop product and try to take it global. Management have not hit the ground running, more limping. Two and half years they've been listed, maybe going to take a couple of more years to get back over a quid, though a big global order could change that quickly.

[simon gordon] 21/11/2013 10:33

Downgraded by Investec!

You could sense in the statement that it was slower than anticipated.

[mega_trader] 21/11/2013 10:14

Sold, small loss, but can make that up elsewhere, too long to wait for next results and not expecting too much improvement. Will probably go down to 50p on lack of intrest.

Downgraded by investec too, suggests slow progress ahead.

[alan@bj] 21/11/2013 10:06

You said you were in at 66.8p on October 21st, Norsewebster?

[simon gordon] 21/11/2013 09:58

GHF,

Fair summation.

This morning I sold because I expected the share price to fall as other traders saw no upside juice in the statement.

I expect the share to stagnate, there should be plenty of time to buy in during 2014 if the global orders flow.

=====

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Oil services minnow #NTQ slips 3.6% on in-line interims. finnCap initiates today with buy take and 83p price target

[varies] 21/11/2013 09:34

My loss so far is about 10% but I do not see anything in these results to alter my view that this is a sound long-term investment.

[norsewebster] 21/11/2013 09:09

I'm waiting to buy. Rammed down on low volume. Just a couple more pence and I'm in.

[cheshire man] 21/11/2013 08:43

Breakeven for me but not complaining !will come back at the righ time and price :-)

[battlebus2] 21/11/2013 08:37

Unfortunately i've done the same though for a small profit. GLA.