Intelek Share Discussion Threads

[davidosh] 09/6/2010 14:21

nickcduk,

I met the directors this morning and they do not appear anything like those we had at TND. I did say to them that they need to raise the profile now and get out to see private investors who are likely to be the lifeblood for smaller AIM stocks in particular. I shall be trying to get them along to one of our investor dinners in the next few months. The AGM is Friday 17th September and they will certainly know how the first half is panning out by then. They looked at a number of possible acquisitions but only very early stage talks and most were in the US.

[spooky] 09/6/2010 10:49

Todays results are outstanding in the circumstances and it is obvious that the management are doing a great job running the business,so its difficult to know who to shout at when looking at the share price.

I have felt that the share price is being held back by a stock overhang from two or three large shareholders who are willing sellers if the share price rises.

The Paradise Datacom business must be on the radar of a few U.S. companies and i am amazed that someone hasn't looked at making a bid already and the fact that there are one or two significant willing sellers should make this process easier.

I will just continue to add to what is now a significant position in a very undervalued business,if people want to sell £ coins for 50p who am i to refuse them.

[jeff h] 09/6/2010 10:25

nickcduk - I've had responses off FD Kevin Edwards when I've enquired in the past.

[nickcduk] 09/6/2010 09:14

Second half profits came in at double H1. No seasonal bias usually so I am guessing they will beat forecasts for the coming year as well. Results presentation slides will give further guidance.

[nickcduk] 09/6/2010 08:37

David,

ITK management are very unresponsive to shareholders. Ive tried to contact them previously but they don't field calls. A bit like TND really. Our only hope is for one day to see a bidder turn up on the doorstep and make an offer. By retaining the current company structure it does put potential bidders off. Maybe that is their aim.

[jeff h] 09/6/2010 08:30

Yes nick an excellent set of results with only the dividend being held rather than increased being disappointing given the trading performance and outlook.

Can only think the held dividend is due to some plans they have with their "various corporate activities which did not come to fruition" charge of £0.2m

Cash needed for an acquisition on the horizon?...or paying down the pension liabilities via another transfer project?...or something else?

$ rate continuing to move in company's favour and with less dollar debt means an even bigger exchange gain if current rates hold for the current year.

[royaloak] 09/6/2010 08:24

In this market they will not be immune from the downturn, but they are already at a massive discount to where they should be so bought a few. Content to buy the likes of these for the long term portfolio, add to the likes of JQV another value stock paying a dividend.

[interceptor2] 09/6/2010 08:17

Lets hope this time we may see a re-rating, the results certainly deserve one. I was impressed with the cash flow statement, which reduced net debt down to £1.6m from £3.8m. All we need now is a future statement which confirms that the commercial markets are recovering.

[davidosh] 09/6/2010 08:14

I have only been buying discretely over the last two months since the trading update but will be looking to see some shareholder value extracted here....they are a very unknown company IMO. Growth in revenue from here should really deliver especially at Paradise where margins are good

[nickcduk] 09/6/2010 08:09

Another terrific set of results which are likely to be ignored by the market again. Just reading through the results the valuation seems to be totally wrong. Paradise on its own seems like a cracking business with excellent prospects. A bidder willing to pay 10 times profits would have to cough up a multiple of the current share price just for that business. They should really break the company and deliver some shareholder value. All this long term nonsense doesn't wash. Ive been in for many years and am heavily underwater despite the very good underlying performance. That is simply down to the company structure and lack of motivation it seems in doing right by shareholders.

[jeff h] 26/5/2010 11:50

Yes, one day this stock may finally trade at a reasonable valuation.

A realisation that it's a dollar earner should help, patience should eventually brings its reward.

[bantam175] 26/5/2010 11:21

Roll on the results. Be nice to se a bit of upward movement.

[balcony] 13/4/2010 21:46

Hi Davidosh-I sold most of these after the interims and the last few only a couple of weeks ago at 14p,The interims seemed to me to be the first negative after several trading statements of positive content,I still like the company and the TS the other day read well,We also had a broker report and still the shares fell back on the afternoon of the statement,i think we still have a overhang,maybe your 100k buy cleared them.I am also not sure of the market in general and sold some TND last week.

[davidosh] 13/4/2010 10:43

Hi balcony....good to see another friendly face from over at TND ! It was not a director buy btw. Do the directors have to buy as part of their bonus scheme on a quarterly basis ?

[balcony] 13/4/2010 10:30

100k buy--If thats a director buy it will get folks attention

[interceptor2] 13/4/2010 07:21

This is the summary from Redmayne Bentley after the trading statement.

Intelek's trading statement has confirmed that underlying pre-tax profits for theyear to 31 March 2010 will be slightly ahead of management's expectations.
Although commercial markets remain difficult, the group's government and
defence business has more than made up for this and the group finished the
year strongly. Whilst the commercial market is yet to show any signs of
recovery, the group's world leading range of amplifiers provide it with
confidence that Intelek will continue to develop its presence in the international defence and security sectors. We have increased our forecasts slightly to reflect the statement, leaving the shares on a very low rating.

[jeff h] 11/4/2010 13:25

Redmayne Bentley now upgraded the 31st March 2010 year end forecast.

Pre Tax Profit now £3.5m (from £3.3m) and EPS of 3.0p

Far too cheap!

[mountain man] 08/4/2010 11:51

interceptor2

Thanks for info - underpins my own view.

[interceptor2] 08/4/2010 08:29

From Hoodless Brennan yesterday............

Intelek (ITK, 14.75p, £12.89m)

Intelek (ITK, 14.75p, £12.89m) Trading statement for the year ending March 2010 highlights better performance in government and defence businesses leading to result slightly ahead of management's expectations. Forecasts are likely to increase from some £3.3m to around £3.4m PBT for the year with 2.9p EPS – putting the group on a 5.1x prospective PER. With the group benefitting from Sterling weakness we see some further progress in profits next year – albeit with the risks associated with any form of government spend. We maintain our BUY stance with the 20p price target.

Recommendation: BUY

[interceptor2] 07/4/2010 19:02

In November 2009 Altium Securities had a price target of 20p, and summed up ITK as follows.

"Still undervalued We remain of the view that the satellite communication division Paradise Datacom is worth more than the current enterprise value of the group in its own right. Given the increased confidence in the outlook, we regard the valuation of less than 6x FY 2010E earnings and c.4x EV/EBITDA for the same year as too low. We remain BUYers."

[interceptor2] 07/4/2010 09:36

Maybe it was my shares you brought, I sold out @ 12p in september 2006 and the rest in October. Great timing just before they sarted to rise to 24p........

[mountain man] 07/4/2010 09:26

Totally agree.
Looks like we may get an increased dividend too. I bought at 12p about 4 years ago for growth and yield. Despite having lost some of the growth (they rose to 24p), I believe that in time the market will catch up with this company and in the meantime I'm enjoying watching the company's performance continually improve - great products and management are the two main ingredients.

[interceptor2] 07/4/2010 09:23

Brought in today after the trading statement. I last owned shares in ITK in 2006 and made a small loss, so I hope my timing is better this time.

Good to see continued strong performance from Paradise which has almost 50% of revenue, so this should underpin this years results nicely. And with the USA economy showing signs of stronger growth, it bodes well for Paradise.

Shame that there has been no signs of recovery in commercial markets yet, but ITK seem well positioned to take advantage once we see the first pick up in this area.

With PER of only 5.3 this year and under 5 for 2011, the risk/reward at this level is very appealing.

Second time lucky?????