Made Tech Share Discussion Threads

[bones] 26/8/2022 15:18

Still strikes me as very expensive compared to similar business Triad Group which pays a 5% dividend yield to boot and is making cash rather than spending it.

Obviously looking at Made Tech at 34p rather than 122p IPO price means it is that much cheaper than it was.

My comparison in post 5 last November stands up to events yet I still cannot see the case of MTEC over TRD at current market caps.

Triad also won two lots on RM6263 (MTEC won one lot) and remains an SME which the government is still promoting in its frameworks.

That all said, both companies are in a growing, secular industry which should hold up despite the recessionary worldwide environment we are entering. Hopefully we can all do well.

[sunshine today] 26/8/2022 13:27

But it’s still

EBITDA

[dr biotech] 26/8/2022 13:21

Exceptional cost was IPO cost, this is not going to be repeated. Sharebased charge was non-cash, shares given to staff as IPO bonus, not sure if this would be ongoing in a different form.

I’ve bought in here, first took my interest after reading an article in scsw. Fortunately didn’t buy in at the time given the subsequent horrendous performance, but it seems fair value now.

[someuwin] 26/8/2022 12:45

It hit 140p at IPO last year = £204m valuation. Now back down to earth at £53m. Plus £12m cash gives current EV of £40m. A good entry level imo for almost guaranteed growth going forward.

[someuwin] 26/8/2022 11:31

A tale of two Mades, with one on the way back up and one still bad...

[sunshine today] 26/8/2022 11:00

This company may involve into an absolute winner , however I am guarded.

Here’s why.

To date they failed to deliver.

They are no longer an SME ( 440 staff V 250 limit ) This means they are on a level playing field with the big boys, and have no advantage.

SME”S are being favoured by the U.K. government under special policies and are right now taking a large slice of government contracts within the sector.

Thus the potential bid POT for the likes of MTEC is reduced by a very large margin before they even get out of the gate by 30% - 40%

They have to bid for all government work and while on some good framework agreements they failed to win both lots on RM6263 ( £4BN of work split with 103 companies)

“Trading on 0.9x FY23 EV/sales we believe the stock represents that most elusive of quarries: a deep value growth stock."

EV SALES EQUAL FA, it’s profits that drive share prices

Profits are not real when presented as EBITD

Still runs old business model of working from various offices with all the costs involved

Only working for Government ( eggs in one basket )No private clients.


“We continue to believe we are seeing the emergence of a company of lasting importance, which is gaining market share within a widening group of prestigious UK Public Sector bodies (many of whom we have spoken to; they have provided unequivocally strong feedback.”

I don’t doubt that, however it’s not allowed at this time as criteria to win more contracts.

To grow super fast they require a high share price to use a currency for the next target company.

Integrations always cost more and take longer than first thought.

Staff issues within the industry don’t get sorted in a fraction of one accounting period !!

Owners took a massive lump out on flotation selling to gullible institutions.

Some who were more than willing to dump all the way down to the shares low point, at the start of the month.

Saying all the above, they may yet surprise myself, clearly they have started to rebuild their reputation and if successful I may have missed out on a potential winner.

Good luck .

[simon gordon] 26/8/2022 10:55

Some,

Thanks!

[tomps2] 26/8/2022 10:51

Made Tech Group (MTEC) FY22 results webinar.

Thursday, 15 September, 12:00pm

Rory MacDonald, CEO & Deborah Lovegrove, CFO will present final Results for the year ended 31 May 2022.

Register here: bit.ly/MTEC_FY22_Results

[someuwin] 26/8/2022 10:20

As regards the Singer note, it was only an update with limited detail. I expect they'll put out a comprehensive note with the results on Sept 12th.

Worth repeating the note summary...

FY22: A year of outstanding progress

"Made Tech has produced outstanding FY22 headline results, with all key top-line metrics more than doubling (head of our expectations). Market uncertainty surrounding the ability to recruit and retain in a tight labour market has been dispelled with y/e employees of 478 up from last year’s 235. Importantly this has been achieved without undue impact on profitability, with GM flat yoy at 38% and EBITDA margin rising to 9% from the prior year’s loss. We continue to believe we are seeing the emergence of a company of lasting importance, which is gaining market share within a widening group of prestigious UK Public Sector bodies (many of whom we have spoken to; they have provided unequivocally strong feedback). We make no changes to FY23 revenue/EBITDA forecasts but increase capitalised R&D as Made Tech continues to invest in own IP, as indicated at the time of IPO. Trading on 0.9x FY23 EV/sales we believe the stock represents that most elusive of quarries: a deep value growth stock."

[masurenguy] 26/8/2022 09:47

Added a few more this morning.

[someuwin] 26/8/2022 08:41

Changed the header charts to include volumes.

[simon gordon] 25/8/2022 17:22

Has anyone got access to the Singer's broker note, if so, could you share the forecasts for T/O and cash balance? Thanks!

[masurenguy] 23/8/2022 13:28

I took an initial position here today.
Annual results, to 30 My 2022 due to be announced next month.

The 12 largest shareholders currently own 65.08% of the shares in issue.

Top 10 Institutional shareholders: 22.51%

Premier Fund Managers Ltd: 10.40m. 7.02%
Canaccord Genuity Wealth: 4.80m. 3.24%
Chelverton Asset Management: 4.60m. 3.11%
Joh. Berenberg, Gossler & Co: 4.55m. 3.07%
M&G Investment Management: 4.00m. 2.70%
UBS Asset Management AG: 1.45m. 0.98%
Mirabaud Asset Management: 1.29m. 0.87%
Liontrust Portfolio Management: 1.19m. 0.80%
KBC Asset Management NV: 871.24k. 0.59%
Sanlam Investments UK: 180.00k. 0.12%

Main Insider Shareholders: 42.57%

Rory McDonald: 41.70m: 28.16%
Chris Blackburn: 21.3m. 14.41%

[bencook1] 22/8/2022 12:09

Took some mtec looks good here expecting a quick ride to 42 and then should be clear to go from there

[sphere25] 22/8/2022 09:17

That's a fail, taken a small loss. No follow through (as yet) after the record buying volume and buyers falling over themselves to pay through the offer on Friday (108k @ 37p and 98k @37.2 as well today but it is still not enough) for decent sized chunks.

After all that, the price has barely batted an eye lid and the sellers look to have handed further large lines of shares to the market makers to sell. Ultimately, as per most out there, the bears remain well and truly in control. Maybe the whoppers that are needed will follow but back to watching.

No doubt the institutional fund manglers will gobble up more overpriced IPO's when the IPO bonanza returns in future years. They must learn...I mean..

Actually, nope they wont!

All imo
DYOR

[simon gordon] 20/8/2022 11:40

Post by BnB onStockopedia - 19/8/22:

Made Tech (LON:MTEC)

For GARP lovers this must be the most important (and positive) update of the day. Made Tech has exceeded slightly reduced revenue and its more significantly curtailed profit expectations this morning. This could signal a turnaround in investor appetite for the name, which is a competitor to Kainos (LON:KNOS) in the provision of digital transformation (DX) services to government. This is a very hot area of the DX market with a long runway for growth. Competitor Netcompany, based in Denmark, recently announced 30% growth in their UK government division.

For an idea of what Made Tech delivers for government and public services, I recently had to update my photo card driving license. Not surprisingly, I chose to do so online and was able to point the DVLA to my passport records from which they picked up my latest photo ID and delivered a new license to me within 24 hours. Impressive.

The Sharewatch small companies publication gives an excellent background to the company, as does the research by Singer published on ResearchTree. I won’t go into detail here because I imagine most of you have access to one of those two resources. For my own part l spent many years delivering DX services in the public sector when active as an entrepreneur. It was very rewarding.

I am somewhat bemused at the price the market places on this name and at the swift reversal of today’s early 20% spike. The former might be explained by the disappointing trading update from February and a persisting concern that today’s swallow does not make a summer. On the other hand, the issues that resulted in the share price collapse of February, namely problems in achieving hiring targets and therefore meeting contract objectives and margin pressures owing to wage hikes, both appear to be somewhat resolved in today’s update, while the swelling order book bodes well for the achievement of the next six months’ targets. The mid morning pullback might just be would-be sellers finally enjoying an up day on which to sell holdings without depressing the price.

Made Tech is valued on half the rating of competitor Netcompany and less than a quarter of the multiple enjoyed by Kainos based on FY24 expectations. The name has more aggressive targets, being a relatively new, faster-growing player in the market and a recent (busted) IPO, but the risk is significantly mitigated by the fact that it is already cheaper than both today based on current year forecasts.

I’m not going to make bold predictions for the future trajectory of Made Tech’s share price, although it looks strong value to me today - Singer calls it "a deep value growth stock" in today's research update. But my not insignificant holding, to which I have added again this morning, reflects decades of experiencing an ever increasing demand for IT resources married to an ever diminishing competitiveness on the part of government in delivering its own IT projects without trusted partners. On which point, Made Tech’s satisfaction levels are very strong, as Singer confirms in this morning’s note.

I encourage GARP investors to research in depth.

[simon gordon] 20/8/2022 11:06

Completely insane IPO.

CEO and CFO pocket £37.5m and £19.1m respectively.

In total directors sold c.58m shares at 122p = £70.7m.

How can the market reward them so highly for a fledgling business that is burning cash and yet to truly prove itself?

The directors must have been popping the champagne.

[sphere25] 19/8/2022 16:12

Where is all this buying coming from? Some folk tipping who have some clout?

6.4m without delayed prints. That is the bulls having a decent go at it. The bears are a nightmare to take on atm.

So I have just joined them here to see if this one can pop because this is relentless buying and buyers are just paying well through the offer for sizeable chunks.

Clearly I can't be sure the sellers are done, but have a little go here and see if there is some momentum.

Might have jumped the gun so an exit if it doesn't pop higher (and back to monitoring it) but let's see.



All imo
DYOR

16:37 UPDATE
So it looked like the big sell orders were given to Winterfloods and Berenberg with the price not moving off 35.5p early in the afternoon despite heavy buying pressure, but Winterfloods ended up on the bid and Berenberg were shifting higher to end up on the offer at 37.5p with much smaller buys shifting them higher and stock not being available at some price points.

Now that MIGHT mean the line of shares to be sold is drying up. IF this level of buying continues next week, it has a chance. I was almost forced into buying for a trade here because of the relentless buying.

Three 525k late prints just hit at 36.04p so a buyer has bid the price up to pick those up. It's notable and interesting so I have put it out there.

Roll on next week, let's see if the momentum continues.

16:38 UPDATE

Berenberg have now moved off the offer of 37.5p (to 40p) and onto the bid at 37p at an unusual time of 16:38.


As per always
All imo
DYOR

[dillydally2] 19/8/2022 12:14

CarefulHere the valli pump fest has started

[bones] 19/8/2022 08:51

They still focus on ebitda which is convenient since they pay a lot for share based payments excluded from ebitda. I think they will still show a bottom line loss and their cash is less than they raised in the IPO. Their gross margin is decent and needs to stay that way.

[netcurtains] 19/8/2022 08:36

its worth doing a little sum...

478 * 65k (wages + perks)
against a turnover of £29.3m

(the figures would work if most of the employees are graduate intake, then wages would be a lot lower)

[sphere25] 19/8/2022 08:20

Considering the buys flying in with a very notable 577k already, the market was expecting worse but can the trust be rebuilt here?

There are sellers in size working in the market gradually dragging the price back away from that key 40p breakout level. Pretty much all buying and I count three small sells knocking the bid back, with more following now.

IF this statement is a thing of better times and an actual rebuilding of confidence, then we'd expect to see some substantial (and I mean BIG) buying to follow to clear the big sellers at work and a break above that key 40p.

I will look to have a go then with a tight stop, but just watching for now to see how the exchanges progress.

All imo
DYOR