Ms Share Discussion Threads

[sidebar] 26/6/2006 09:11

IanDippie - "and the Sidebars of this world have chosen to invest elsewhere"

Ooooh! I didn't realise criticism wasn't permitted in this private club.

[xdavid] 26/6/2006 09:02

Rivaldo, don't forget that in the same way that MSI don't have to announce that they are making stacks of extra profit, they also don't have to announce that they are likely to produce a steaming loss ;-)

They only have to 'correct' any previous trading indication that they have made to the market. They don't make any therefore they don't need to announce changes! (unless, of course, they have made forward statements as part of the results statement ? - must re-read :-)

[cockneyrebel] 26/6/2006 08:52

Well the forward PE is aroud 7 or less by my reckoning. Historic PE 15.5.

So lets look forward 1 year. MSI do 18p eps this year and we are againg trading on historic PE of 15 = 270p a share.

I suspect that might be a conservative estimate because the more MSI pump out earnings growth in excess of 50% pa the great their cred and reliability becomes so investors are likely to start paying higher forward PE's for the stock.

CR

[xdavid] 26/6/2006 08:51

You don't maximise shareholder returns by just pumping the PE up via RNSs about all and sundry. You maximise shareholder returns by doing your job on earnings. The share price will follow. If you are a true "shareholder" and not a pump-and-dump speculator, then why should you be bothered about whether the PE is lagging a bit? As a true 'shareholder' you're not thinking of selling just because it's on a high PE are you?

It has always seemed to be on a small PE - didn't stop the share price quadrupling in last 2 years.

However, I have no doubt that the Investor Relations part of the jigsaw will come later when the board decide that they have all the other parts in order. Put yourself in the place of the directors who own 30% - why go to all the trouble of advertising the company now and then having to sell their own shares 'cheap' to satisfy the inevitable "investor demand" when they can just concentrate on doubling the cap a further couple of times and THEN advertise to the market. I actually think it will take another 1 or 2 more years of stellar performance before the big market players will start to believe that this performance is sustainable anyway.

The web site fluff will come around soon enough.

I remember Stanley Gibbons used to be in a similar condition. Low PE (& stacks of cash), lots of promise but the web site offering was pretty poor for a company who actually wanted to move into being an internet brand. However, bit by bit it put its core business into order, the web site evolved and eventually people got convinced. It doesn't happen overnight.

[johnrxx99] 26/6/2006 08:35

imo we're doing OK without the hype. Steady growth rather than volatility is my preference.

[doubleorquits] 26/6/2006 08:26

sidebar,

A main reason for such a low PE is the lack of a broker to give forecasts. If CR's forecasts were issued by a broker we would have an share price that was much higher because it would be easier to attribute a reasonable rating. We would also then be more open to the vagaries of MMs playing with the price. At least they are as much in the dark as most people - anybody who has done some research or is using CR's forecasts will have some idea of what to expect if they apply certain PE ratios to the scenarios.

Someone posted that a historice PE of 14 or 15 was achieved last September - if that is so and MSI hit 15p minimum the price should be around 210p by then. I expect a little higher than that FWIW.

As for shareholder value, the directors have not done a bad job with buybacks and an share price that is not re-rating too badly - more than doubled in a year or so. I don't think they are doing too badly actually, even if they are not as proactive as they might be. Just treat it as our little secret and wait until the secret gets more widely known :0)

[sidebar] 26/6/2006 07:49

I don't understand why some people applaud the fact that the company is not more pro-active with news and/or a bit of back slapping and shouting from the roof what a great company this is.
Let's get the PE ratio to 15 or 20!
One of the most important jobs for the directors is to maximise shareholder returns.
Isn't it great that we're on a lowly rating? No, it isn't.

[rivaldo] 26/6/2006 07:43

Nice posts. Xdavid, I remember the response you got from a poster who is one of the most respected posters on T.M.F and was gobsmacked by it! As stated above. the proof in the pudding is the share price and the financial performance of the company, which is superlative.

Given that MSI are so keen on only announcing in tight accordance with the rules for RNS's (bearing in mind the non-announcement of that recent £15m contract), it can only be good news that there has (as usual) been no trading statement or warning prior to results - we should be able to deduce that trading is fine at worst or continuing to be excellent at best.

[cockneyrebel] 25/6/2006 10:32

I've seen a lot of companies with great websites telling me how great the company was what they were going to do, how huse he potential market and margins could be in their RNS etc. Then they post losses year after year and disappoint.

MSI do exactly what they say on the tin. Yoiu might have to do a lot of digging around to find the info but when did a good investment not involve a little work?

If it was all spouted on a website everyone would be in here now but more and more they are getting recognised and veatured in the press and after these results the earnings growth is going to look staggering imo, year on year in year and attract even more attention.

CR

[xdavid] 25/6/2006 00:26

bjs38, I do kind of agree with your reservations regarding the transparency of business etc, (as I alluded to in my previous posts) however at the moment I actually see the current state as a positive for the reasons indicated by Mr T. If you have a look back at the last two years worth of share price and have a read of the same two years worth of reports then you would see a company where the management is concentrating on the aspects which make the money - not the periphery trappings like web sites! MSI is a classic recovery play which gives the private investor (who is willing to do the DYOR) a chance to get in early and reap the rewards. Once the management have the business under control and feel they have some time on their hands then I'm sure they will turn their attention towards making it more appealing to those investors who want an easy time (including professional commentators). This will probably be the time I will be looking to exit!

Frankly, why should the board give a toss about a private investor who just wants to piggy back on diectors' genuine risk taking and turn a fast buck? For some reason PIs always want to be regarded as "owners" of the company when the vast majority will quite happily pump and dump to their benefit!

I remember posting about MSI on a popular Motley Fool forum in September last year and got a similar response - "they can't be much good if they can't be bothered to have a good investor website!". The price at the time was £1.20 (up 50% in 9 months since).

I dont understand what the lack of a company website has to do with the fact that they are currently making large % increases in profit for last few years without one!

Eventually they will get around to it but by that time the real growth work will be over. Yes, there will probably still be some gains to be made because lots more people will be able to see what's there but the big gains will already have been banked by the people who can research without the need of a data-stream.

How can I beat a company which is so difficult to research but still gave me a capital gain of 100% last calendar year alone! And is probably still on a current year PE of under 11! Who needs a web site when you can just read the accounts every 6 months?

A happy bunny
-david

[mr. t] 24/6/2006 15:34

Hi bjs38,

You have a point, I would prefer more and better communication from MSI. However, the lack of communication has meant that some investors (like yourself, maybe?) have been reluctant to invest and kept the price lower than it would otherwise be if the directors shouted from the rooftops, like some companies do. That has given us opportunities over the past couple of years to buy shares at an attractive price.

Thanks to some great research from the people here, like CR, Rivaldo and xDavid, we know as much as we need to know about MSI. If you've got a question, look through this thread. If you're still not sure, why not ask us lot here?

Personally, I still think the price is too low now, as I am confident that the forthcoming results will be very good and that the short to medium term prospects are excellent. If I didn't have a very overweight position already, then I would still be buying.

However, it's easy to say that when the business is going great guns (quite literally!) and the share price is rising. If and when a downturn comes, no doubt everyone here will be pretty peed off with the lack of communication to shareholders :)

A couple of points that you should consider are that the Directors have about 30% of the shares (an almost perfect percentage, from our point of view), of which a fair few were bought with their own money in the market over the last few years. Also, the company have been buying back shares consistently at low prices. In my opinion, I would far prefer an owner oriented set of directors with a poor website, than a company with a flash website and directors who take home a huge paypacket, have large expenses and don't give a monkeys whether the share price goes up or down.

Anyways, you pays your money and take your chance. If you don't like the way MSI treat their shareholders then invest your money elsewhere. If, like me, you are extremelly pleased with the way they are running the business and like low share price valuations, then invest heavily.

Regards,

T

[bjs38] 24/6/2006 10:48

The numbers look good but does the company have respect for its share holders?

It has no corporate website and has not responded to my emails

[rivaldo] 23/6/2006 09:06

Just to harp on a bit more about the golf angle:


"Global Ranges - Sponsors of the 2006 OGRO Conference & Exhibition

Global Ranges specialise in building high quality steel frame golf ranges and can take your concept to full build specifications quickly and comprehensively"

"OGRO is the only organisation representing golf range, golf centre owners and operators in the UK."

So it seems that this is something very current given the above sponsorship. I reckon MSI have sneakily developed another earnings stream here...

[rivaldo] 23/6/2006 08:02

Breakout again :o)) Earlier I could only buy 1,500 shares on-line - pressure is building nicely prior to next week's results.

Fantastic research xdavid! Did you click on the "Contact Us" page on the golf site - it actually states the address is Global Ranges, Global-MSI PLC!

So it appears MSI have a hidden (and presumably smaller) division which builds golf driving ranges - another niche and fast-growing sector. And they may own a useful bit of land too.

This company gets better and better!

[mr. t] 23/6/2006 07:15

David,
Excellent research, thank you very much for sharing it. Here's to a profitable next couple of years!
T

[cockneyrebel] 23/6/2006 06:57

interesting find David - well done :-)

Up 5p pre-open today :-)

CR

[xdavid] 22/6/2006 22:17

Stranger and stranger...

Remember that earlier discussion about what sort of land MSI might have on the books and whether it could be lying spare or anything?

Well...

I'm wondering whether this is a picture of part of the land in Tonbridge...


It's a long shot but bear with me... firstly, go to the Global-MSI web site..


...click the offices/contacts button and then the Tonbridge office link...
...note the address and postcode: Cannon Lane Tonbridge, Kent, TN9 1PP

Now, on the same web page, click the link on the left to the "Parner": Global Ranges...

Yes, MSI seem to have 'yet another' business string - golf ranges!!!
Website (yes, another cheap one :-)...


Note the Global-MSI logo in the corner!

Anyway, on that home page, click the Projects link (only two projects noted), one of which is listed as "Tonbridge Golf". Some nice pictures of a very leafy golf range. Where is this golf range? From their web site..
(must be done by MSI's web designer, it's so bad!)

... its address: Cannon Lane, Tonbridge, Kent, TN9 1PP. Note the Golf Pro, James Jones, is the same James Jones listed on the Global Ranges web site.

OK, so maybe they are just next door neighbours, but it was an interesting trail for a Thursday night :-) And certainly the Tonbridge unit is in a nice industrial estate given that there is a 9 hole, very nice golf course right next door!

-david

[xdavid] 22/6/2006 21:20

I think that reference to 100 guns has been there for quite a while (over a year?). Note it says "have been supplied or ordered" and MSI have been in business for 80 years... Personally, I'm not reading anything into it either (at least until the results ;-)

Very Interesting Shell/Atkins find Mr. T!

Note that MSI state on their Global-MSI website...

"We are the sole contracted canopy partners for Shell, Esso and Jet throughout Europe and in addition are one of BP's leading European forecourt structures partners...
Last year we supplied forecourt structures in 33 countries designed to 33 different design codes... The European Petrol Station is our workplace"

Can't provide a link due to them using flash instead of html, but just click the "About" button on their home page.


MSI hold a 50% interest in Global-MSI which is a joint venture with (I think) two european construction companies in France and Germany. My reading of the 2005 accounts show their share of the turnover as £6.0m (2004: 6.1m) and operating profit of £362k (2004: 302k). About 12% of the total operating profit.

Very interestingly, their operating profit share for the JV for the 1st 6 months this year was £464k - a 26% increase over the previous full year, in just the first 6 months! The separate turnover figure is not given for the JV in the interim report. So that should contribute another 1.5p over previous JV earnings.

And presumably that was before any additions from the Shell contracts mentioned in the Atkins report. Gets more and more interesting :-).....

-david

[sja123] 22/6/2006 19:32

Can't wait........I must say, I know nothing about charting or it's relative merits in picking stocks.....but that's a great looking chart too......love the way the second half of the last two years this has motored.......doubled after results last year......bring it on!

[cockneyrebel] 22/6/2006 17:53

not sure if or how many MSI 30mm guns would have been sold prior to this year but I can't think it's a lot or they would have made a statement like the one in the interims I'd have thought.

Like I say, don't read too much in it yet as we'll know when the results are out.

CR

[cambium] 22/6/2006 17:45

Turnover was previously stated as 32 million- blimey we could be in for some goooooood news

[cockneyrebel] 22/6/2006 16:48

I did notice on the home page tho that they say 100 MSI 30mm naval guns have been ordered. The interims says that the MOD order for the initial batch of 24 was worth £15m.

Not sure what to read into that but seems they have sold 4 times that MOD order.

CR

[cockneyrebel] 22/6/2006 16:43

I love the only active link there that says 'return to the top! :-)

CR