Eurovestech Share Discussion Threads

[kenmitch] 02/3/2007 20:01

Progress continues apace at KSS. For more information see their website.



They keep it up to date. It includes several bits of recent good news presumably not worth putting out in an RNS.

Magenta.

Their website is good too, with clear explanations of their offering, and much more.



BUT they need to update it. The last bit of "recent news" is from last October. Unlike with KSS, EVT do not own all of Magenta, just a chunky stake so keeping the website up to date is presumably up to Magenta? Time they did if there is any news to report since last October.

The EVT website is also excellent imo, and they always keep it up to date. From their website the websites of their investee companies can be accessed.

[dassera] 16/2/2007 21:05

ken......shhhhhhhhhhhhhhhhhhhhh!

[rambutan2] 16/2/2007 16:46

thanks ken,

i wondered what had pushed up the price this week.

[kenmitch] 16/2/2007 15:56

Another buy note. This time from Arbuthnot Securities. Very positive about Eurovestech.

I haven't got a link. I posted the key details on Mike Walters bulletin board and have copied and pasted most of it to here. Apologies to those who don't approve, and for the irrelevant asides.

....................................................................................................................

Arbuthnot head it "Eurovestech. Nurturing Investments with outstanding growth potential."

They then mention the proven success of Toluna, and suggest that similar successes are achievable with KSS and Magenta.

A key new point - well new to me anyway - was their suggestion that considering Eurovestech as a technology fund, it is by far the cheapest, trading at a discount of 19.3% to estimated NAV. Discounts in the sector have narrowed.

The key drivers of the EVT share price they suggest will be a continued srong performance from Toluna, and they speculate - in addition to everything that has already been posted here about Toluna - that Toluna is likely to be acquired by a trade buyer at a healthy premium.

The other key drivers of the share price should be KSS and Magenta which are held at carrying value because both have been undergoing rapid development, making it impractical to benchmark their market value. They think there is strong value to be unlocked, and suggest that like TOL, KSS too is likely to go to a trade sale, or IPO.

Finally a narrowing of that discount should help lift the share price. They point out that EVT has around £7.4 million cash - worth over 2p a share, and their stake in TOL is worth 15p a share. That leaves the remaining assets, trading at a 57% discount.

A selection of other points.

1. They note the similarities and differences between EVT and Prelude Trust. Prelude used to be a bit of a favourite here, and at that time I think I was the only one here who much preferred EVT to PDT. EVT held a stake in PDT but that has now been sold at a profit. Their note didn't mention that EVT shares have way outperformed PDT.

2. New investments for EVT are likely to be in sectors like WIMAX, websearch and oil and gas exploration. (Some oil and gas exploration Companies are at bargain prices just now. EVT is very good at spotting bargains. Could be some interesting new investment news before too long. They have funds available).

TOLUNA.

1. Arbuthnot discuss the 50.2% EVT holding in TOL in some detail, but most of it is familiar to EVT and TOL fans here. They point out that TOL is continuing to improve margins (up from 21 to 25%) and that TOL has a competitive advantage over RNOW and YOU thanks to their proprietary software "Panel Portal" and "Automate Survey."

2. Online market research still only accounts for 5% of market researcy, compared with 30% in the US. Richard Bernstein (EVT C/E) believes TOL will be a principal beneficiary as this gap closes.

(surely the online research sector is heading for significant further rapid expansion? This has got to be good for all three of the main companies in this sector.Yes, the shares in RNOW,YOU and TOL are all on high current ratings.But these are probably justified by the very rapid and proven growth in turnover and profits. By buying EVT you are getting exposure to this sector via their 50% stake in TOL, but you are also getting the potential upside from KSS and Magenta as well, and from any major new investments).

3. The Arbuthnot note points out that EVT have sold enough TOL shares to cover their initial cost. (It's better than that. They've already taken a profit of over £5 million on their original investment, and are running the 50% stake currently worth around £47 million for free).

KSS.100% held by EVT.

Again the following from the Arbuthnot note is mainly in addition to what is already known by EVT fans here.

1. The EVT 100% stake continues to be held at a carrying cost of £4.2 million. BUT they say that Richard Bernstein is confident that the current year will meet expectations of pre tax profit of £2.5 million on revenues of £9 million. Arbuthnot reckon that on fully taxed earnings of £1,6 million an equity value for KSS of £21 million.

2. They also point out the heavy investment in KSS, and the stronger product offering and new contracts.

3. They believe KSS could be a strong candidate for a trade sale or IPO. They say that large players like Oracle and SAP have been making acquisitions in this sector, and that Oracle Corp's purchase of privately held Prologic in 2005 is widely believed in the market to have cost $160 million. (i.e the hint there is that KSS could be worth a good deal more to a bidder than £21 million).

MAGENTA. EVT holds 43.7%.

1. They point out that EVT's total cost for their 43.7% investment (including a £1 million addition in June 2006 to take their stake from 37.7%) is £2.4 million, and that EVT has not adjusted the valuation for the subsequent funding round which implies a valuation of £16.7 million.

2. They say that read- across valuations would suggest that the £16.7 million valuation is still conservative. Quoted UK Company CODA trades on 22.6 times 2006E.

3. They also point out that Systems Union was bought by Extensity for £220.5 million. They made profits of £16.5 million on turnover of £113.4 million which valued their business at 13.4x pre tax profits. ie. the value of Magenta's technology and expertise to a large company could be significant.

(Certainly worth a good bit more than the current £2.4 million carrying value! A few more contracts might well increase the appetite of potential bidders imo).

................................................................

So there we have it. Another positive note on Eurovestech.

The amazing thing is that even after a 10 fold rise in the share price the EVT share price still looks cheap. They are trading at a near 20% discount to estimated NAV. Unquoted assets could well be trading at a 57% discount, say Arbuthnot.

With EVT you've got a stake in TOL - in the go go online research sector, and in the great promise of KSS and Magenta. Then there is that £7 million cash, and all their other stakes - mostly admittedly very small ones.

Still not too late to buy imo. Run your winners and cut losers is the way to win at this game, and this winner looks as though it could run and run.

[asmagliocco] 03/2/2007 10:30

2 director sales but apparently to satisfy institutional investors (see last sentence):

2 February 2007

Directors' shareholdings

The Company received notification yesterday that on 1 February 2007 Richard
Grogan, Non-Executive Chairman of the Company, sold 1,000,000 ordinary shares
in the Company at 20.75p each, equivalent to 0.32 per cent. of the issued
voting share capital of Eurovestech. Following the sale, Mr Grogan holds
1,535,019 ordinary shares in the Company, equivalent to 0.49 per cent. of the
issued voting share capital of Eurovestech.

In addition, the Company received notification that Quentin Solt, Non-Executive
Director to the Company, today sold 250,000 ordinary shares in the Company at
20.75p each, equivalent to 0.08 per cent. of the issued voting share capital of
Eurovestech. Following the sale, Mr Solt holds 1,525,019 ordinary shares in the
Company, equivalent to 0.48 per cent. of the issued voting share capital of
Eurovestech.

The transactions were carried out by Cenkos Securities Limited, the Company's
joint brokers, on behalf of the directors and the shares were acquired by
institutional investors.

[buffin] 01/2/2007 14:54

Great post, Ken, thanks. As you know, I keep hesitating over EVT!

[rambutan2] 01/2/2007 14:27

ken, thanks for keeping us up to date. i've high hopes for all three major investments this year.

[kenmitch] 01/2/2007 14:23

More positives.

Teather and Greenwood recently reitertated their buy advice. Can't get the link to work, so have copied and pasted.

"EVT.L Eurovestech Remains Buy



Price: 21p

Market Cap: £66.1m

Sector: General Financial

Analyst: Bob Huxford

Tel: [phone]


FORECAST
GBP YR1E
Jan 2005

SALES £0m

PBT Adj £0m

EPS Adj 0p

DPS 0p


Click here to view graph

ToLuna Rocketing

Eurovestech's largest holding, ToLuna, in which it holds 50.2% of the capital worth £42.2m, has put out a positive trading update today ahead of its full year results.



The update states that revenues for FY 2006 of £8.3m, a 275% increase against the £3m reported in FY 2005, are ahead of analyst's expected £7.9m. With margin in line with expectations at 25% (against 21% in 2005), operating profits similarly exceeded analyst expectations by 5%, reporting £2.1m against estimates of £2m.



Further positive news comes in that panel membership has grown from 729K FY 2005 to 1.3m members while the number of clients has more than doubled to 246. This final metric is particularly relevant as over 70% of revenues are from repeat business, suggesting a positive outlook and high level of visibility for the coming year.



Since selling a 6.7% share in ToLuna in November for £4.5m, the residual value of Eurovestech's holding has grown from £34.6m to £42.2m. We believe that the combination of stellar revenue growth, enhanced margins, technological superiority and a community status combine to convince us that there remains further substantial value to be unlocked from Eurovestech's stake."

Also Arbuthnot Securities suggest a NAV for EVT of just under 27p. They value KSS at £21 million, basing that on 12 times 2007 expected earnings of £1.7 million. Magenta they value at £7.3 million based on the last funding round. Toluna currently valued at £44.5million.

More contract news from KSS and Magenta, and further rises in the TOL share price and NAV is heading higher still. What with the cash on the balance sheet too, EVT shares look cheap, and will be cheaper still if TOL continues to rise and the EVT share price sticks where it is.

Interesting acquisition yesterday from RNOW. Sent their shares into orbit, and drew more positive attention to the on-line research sector.

We know TOL and EVT are looking at further initiatives for TOL. A small earnings enhancing acquisition a possibility in time? They have already suggested that they would be looking for such add ons. Hope if/when they come they give the TOL share price another lift.

btw the EVT website remains very good and they keep it up to date. Access to all their portfolio companies from there - www.eurovestech.co.uk

Not surprisingly there is loads on the Toluna website and Magenta's too is now very informative. www.magenta-technology.com

EVT shares have been a great investment since 2003, and imo have a good bit further to go.

[beat the market] 25/1/2007 12:21

TOL up nearly 5% as I write having issued a postive trading statement & upbeat outlook, yet EVT has been ticked down !?

[integer] 12/1/2007 07:54

RNS confirms it....

[kenmitch] 11/1/2007 19:46

Good spot. KSS seem to be winning plenty of contracts now, and as you say this one looks big.

[integer] 11/1/2007 10:36

this is B I G or gigantic ....for EVT

[Abuse team] 07/1/2007 20:01

Post removed by ADVFN

[integer] 20/12/2006 20:05

done same, can see it now. weird huh?

[kenmitch] 20/12/2006 19:58

The same thing happened when I clicked Buffin's link. It brings up a premium page. I found the new thread and the chart by clicking search + the EVT epic. Thanks Buffin.

I never really understand these ADVFN threads. Does it mean we should all be posting on the new thread started by Buffin from now on?

[buffin] 20/12/2006 19:58

It's heading says

"This Premium Bulletin broadcast thread is visible with READ/WRITE options on the Free Bulletin Board".



Anyone else have trouble clicking on this link?

[integer] 20/12/2006 19:52

advfn says i need a subscription upgrade to view it...

[buffin] 20/12/2006 19:48

Everyone should be able to post on it and read it, Integer - are you having problems?

[integer] 20/12/2006 19:44

can it be made a free board Buffin?

[asmagliocco] 20/12/2006 14:54

Thanks for the charts, the story's much clearer now! Got in late but the p/f looks good to me, concise and well managed.

[mangal] 20/12/2006 12:01

Thanks Buffin; much appreciated.

[buffin] 20/12/2006 11:48

OK, I've put a skeleton thread with charts at

.

If someone who knows the share better than me would like to send me some text for the header, I can easily add it.

[mangal] 20/12/2006 11:12

Any Volunteers ?