Getech Share Discussion Threads

[stewy_18] 10/10/2013 20:23

Shanklin,

I normally find the forecast figures for 2014 on the conservative side (especially from WH Ireland where they are quite pessimistic for all their forecasts). Not sure about the REFS figures.

FWIW, I'm holding to see what happens with regards to globe II :-


We are very pleased to have signed up three companies so far and anticipate that further clients will join the project as it progresses.

If GTC can sign up a few more clients there, we will be onto a winner. Add to that, the reocurring revenues for globe and I think the future is bright.

Just my opinion.

Regards

Stuart

[pj 1] 10/10/2013 17:39

Barclays

Forecasts

Year Endin Profit(m) EPS P/E PEG EPS Grth. Div Yield
31-Jul-13 1.38 4.59 15.5 0.3 +44.34% 1.40 1.7%
31-Jul-14 1.49 4.94 14.4 1.9 +7.63% 1.50 1.8%

[shanklin] 10/10/2013 17:33

...If it is, then its the second time the numbers for GTC have been wrong on REFS.

[stewy_18] 10/10/2013 17:04

ps I received a reply from Raymond Wolfson on July 24th with the same address you used and got a response

[stewy_18] 10/10/2013 16:52

Shanklin,

Here is what I have from the brokers notes. I can send you a copy if you wish.

Y/E July 2011A 2012A 2013E 2014E
Revenue (£m) 5.33 6.44 7.80 (7.25) 8.20 (7.75)
PTP (£m) 0.67 1.25 2.05 (1.80) 2.25 (1.94)
EPS (p) 1.97 3.18 5.23 (4.59) 5.75 (4.94)
P/E (x) 33.0 20.4 12.4 11.3
DPS (p) 0.20 1.00 1.40 (unch) 1.50 (unch)

EPS at 5.23 pence for this year. Where has this revision in EPS rumour come from? Reading back through my posts, I see only a revision upwards from 4.66 pence to 5.23. If they hit the forecast EPS, they will be on a forward P/E of 13.5 which drops significantly if you strip out the cash (£5 million).

To my knowledge there is not any reason why the share price has dropped. I confirmed directly with WH Ireland and there has been no revision downwards of EPS figures for this year.

Looking back at your posts, your predictions of 7 pence EPS may have been a little high (see post 899 ), so I'm not sure if that is the reason why you think there has been a change.

Indeed this share does seem to be quite volatile. I picked up a few when it dropped back to 40 pence and that was after a director dealing RNS (there have been more than one).

It is fair to say this can be volatile, but I think the critisism of not releasing an RNS to downgrade EPS is completely unwarranted. They haven't downgraded anything.

Unless someone can show me any different, it is steady as she goes.

As for the share price drop... well it happens. It was probably a little toppy at 87 pence. Maybe people took at look at the forecasts and sold before the results at a good price. If I was looking to trade, I may have done the same. What I have seen however, is that GTC can release contract wins at any time and they can be quite significant.

Just send me your address if you would like the note.

Thanks and regards

Stuart

[shanklin] 10/10/2013 16:21

WCB,

I'm more interested in why its been reduced on REFS by circa 20% without an RNS than whether its reasonable value at current levels.

My view when I bought GTC was that I was getting into a likely ZULU stock at a fairly early stage of its growth. A reduction in EPS would not help in this regard.

Best wishes, Martin

[westcountryboy] 10/10/2013 16:11

Even if 4.66p turns out to be the new 'official' figure, then bearing in mind that it will be conservative at this stage, and bearing in mind also the net cash position, then the current price hardly seems bloated for a growing company. It has also reached some sort of chart support. So no need to panic in my view!

[shanklin] 10/10/2013 16:05

I e-mailed Raymond Wolfson ([e-mail]) to ask about the change to the forecasts, but my message got rejected as SPAM. Not ideal.

On REFS the change is dated 23-Sep-13.

[scotchbroth] 10/10/2013 15:57

According to Morningstar, the 2014 forecast was changed on 30/09/13 to 4.66p
2013 forecast is 5.23p.

[shanklin] 10/10/2013 15:45

Stewy, So what forecasts do you have in that WHI note?

I would like to think I'm not considerably out of pocket (which I am) simply due to a clerical error :-(

[bookbroker] 10/10/2013 15:18

Have to confess I increased my holding here in the eighties, rotten timing nonetheless, wouldn't surprise me if that Stephens character was offloading more stock, weakness surprising despite above comments, still could be many reasons, but confidence clearly dented, mms trying to clear an overhang in a small co., a tricky business to do so when they've had a good run over the last year, if things carry on I'll be heading for the exit too!

[stewy_18] 10/10/2013 14:08

Gents,

The last broker note I have from WH Ireland was the 16th July. Has another one been released because WH Ireland say they haven't. What date was it released and does anyone have a copy? It would explain the drop over the last few days but I would really like to see it before I make a decision.

Thanks in advance

Stuart

[bookbroker] 10/10/2013 09:23

This co. has talked along time about potential acquisitions, either they cannot find one or they are simply too expensive, whatever the case it's likely the cash on the balance sheet is burning a hole in their pockets, being used for R&D. or paying too many staff, if the revenue stream are in danger of drying up a little, then they should be looking at their costs, potential issue here is that this is somewhat of a research based organisation rather a razor sharp corporate entity, being formed out of Leeds University Geology Dept.

[bookbroker] 10/10/2013 09:15

We know that future guidance basically runs up until mid 2014, when many of the early stage Globe agreements expire, it's up to Getech to maintain this recurring revenue stream with upgrades, WHI are merely assuming that either several will not be renewed or they will not simply be as earnings accretive.

[shanklin] 10/10/2013 09:08

WCB, sadly I have not seen the WHI note. For me it would be another black mark for GTC if there is anything in there which should have been RNS'd.

Cheers, Martin

[bookbroker] 10/10/2013 09:08

We'll find out in good time when the co. reports!

[pj 1] 10/10/2013 09:06

jamie, read the DRV BB, last 2 days, refer to Wood Group Contract

[jamielein] 10/10/2013 08:42

I'm also out of GTC (yesterday). I wish I'd seen the change in broker forecasts sooner.

THAL do potentially look better value. I still struggle to see the value in DRV though (but I'm obviously missing something because I've been struggling to see the value for about 6 months)

[pj 1] 10/10/2013 08:36

Just a comment but maybe some PI's are seeing better future value in DRV and THAL ?

All 3 are good companies though

[westcountryboy] 10/10/2013 08:33

Has anyone actually read what WH Ireland say or are you all just going on a website figure? I would be interested to see their comment.

[shanklin] 09/10/2013 17:49

Hi madmix

Yes, just annoyed that I didn't notice the change in broker forecast for next year a week or two ago. IMHO, in addition to the director sells and the downgrade, one now has to add the risk that directors will be a bit slippery with respect to updates. It would not surprise me if the FY results state that the business is performing in line with expectations for the current year with no mention that those expectations have been reduced without this having been RNS'd.

P.S. There is quite a lot of cash on the balance sheet.

[madmix] 09/10/2013 16:38

Hi Martin,

I must admit that I was spooked out last week when I saw the latest WH Ireland forecast for 2014. My concern here has always been the growth potential going forward. Given the recent director sells, coupled with the downgrade, I concluded that it was difficult to justify holding the shares.

I haven't seen the WH Ireland note, and as bookbroker points out, I suspect they are being conservative. However, given that the forward PER is now around 16, I won't be rushing to buy back in until the outlook becomes clearer.

[shanklin] 09/10/2013 13:23

According to REFS, The change in broker estimate was on 23-Sep-13, so nearly 3 months into the new financial year. Rather than guiding WH Ireland to reduce the broker estimate down by nearly 20% on the quiet, I think the company should have been updating the market. Combine this with the large volume of director sells and one wonders whether they are building a sustainable growth business or just has one very good year.

Given my concerns, and a wish to avoid negative excitement due to some heart problems, and I decided it was better to be out of GTC, looking in, rather than the other way round.