Porta Communications Share Discussion Threads

[adamb1978] 27/10/2015 14:56

I've bailed out of PTCM over the last couple days, at a 20%-30% loss. The reason for selling is mainly the very simple one that I cant see that the current price is justified. If you take the recent figures and project forwards, you have to make quite racy assumptions to get to an EPS figure in say 2016 which would make the trading multiple 'normal'.

And the problem is that they're not operating in a growth industry - over the longer term, this will grow at a GDP-like rate. Their acquisitions are bedded in now and fully reflected in the numbers (ie there is no more contribution for them to make, over and above organic growth) so unless they can make some revenue synergies, there is no reason to expect the top line to rocket. There might be some cost savings, however they were already partly in the recent numbers.

So projecting this forwards to 2016 and putting it on a fair multiple for this sort of industry (perhaps 12x?), I couldn't get to 9p per share. I could get to about 6p - 7p at best. At worst, profitability isn't hit until 2017 or later, which doesn't make this investible in my view - I'd only wait 2+ years for a company to turn a profit if it was in a real growth industry, which this isn't.

Re the recent director trades over the last couple weeks, different people take different views but I don't take any comfort in them. Apart from (perhaps) the CFO, the other trades were people already adding to very long positions already, and therefore by people who had a strong incentive to get the share price up. Coupled with this, I do not trust the current management team - some of their RNS announcements over the last couple years have been, at best, heavily spun. Some which were 'just' spin and nothing more were terms like 'EPS on EBITDA' and calculating their EBITDA margin based off gross profit rather than turnover - quite ridiculous!!

All the best for holders... I'll watch from the sidelines
Cheers

Adam

[dbnout76] 26/10/2015 20:19

Are they really all sells today?

[oldie52] 26/10/2015 10:38

Cant see how they can possibly issue a Trading Update now. Directors can buy after an update not before.

[salpara111] 26/10/2015 09:30

Another director buy on Friday.
I wonder if we will get a trading update this week.

[parob] 24/10/2015 18:26

Fantastic turnaround in the share price these past couple of weeks. Nice client win for Thirteen this week:http://www.prweek.com/article/1369119/brief-ford-picks-thirteen-centremk-appoints-rain-halpern-princes-charity-wins-pm-award-kindred-gets-callcredit"Ford hires Thirteen for corporate partnerships briefFord Motor Company has hired Thirteen Communications to secure B2B partnerships for its new GoDrive car-sharing smartphone app, which was recently launched in London. The initiative is part of Ford's Smart Mobility plan to develop solutions for modern transportation challenges. Thirteen was handed the work after approaching Ford and advising it on a B2B strategy."

[jefftwo] 23/10/2015 19:10

Interesting day and much of what posters on this site have been talking about for some timeWith a strong TS and a liquidity issue we could still see a bit of a hikeConfidence appears to be coming back

[fillipe] 23/10/2015 14:59

9.9511p being paid for PTCM today. Looking back I see Sanlam's June 2015 tp is 11p and surely by now, that will have been upped a touch, or more.

f

[qs99] 22/10/2015 08:21

fascinating reading. whether directors are buying or not, the market surely IMO will value this on metrics it delivers so EV vs EBITDA and EV IMO will include earn-out obligations....if it is high growth IMO it will merit possibly a higher rating than some of its peers. Just be careful if you are buying purely because directors are buying!

[oldie52] 21/10/2015 15:52

I see that Steffan Williams is on the Porta website as on the Board so he appears to have started already. Good that Finsbury didn't hold him to a notice period which they normally do for really key people. Maybe as he only lasted a year there he was still in his probationary period.
Expect to see some of the Finsbury clients moving to Porta?

[kimboy2] 21/10/2015 14:09

I may be wrong but I don't think that Bob Morton and the management are buying shares to cling on till they reach 10-11p.

[guildedge] 21/10/2015 09:01

The problem here is judging what the true market cap should be. A minimum of 25M+ for me. Current market value by share price shows as just under 25M. The broker rates this share at 10p. So closer to the 28-30M mark.

The 2.7-3M ebidta is for this year. They have already announced cost saving of 1M. so it's not just as simple as picking a figure close to end of year and saying the firm is not worth the current 8-9p the market values it at. The highest director buy was at 9.1p only 2-3 months ago. The high volume of director buys speaks volumes for me. Especially from BM who has ploughed over £0.7M into this firm this year. Over 14M shares bought by directors this year!

For me it's about what this firm might do in the future too. There is great potential here and I believe a profit is not far off. Maybe not this year due to A and D but come 2016 much more likely. Revenue growth for 1st half of year was 17%. They are the only firm with double digit growth here. I suspect this will continue.

I think the II article showed a really positive view on this share. I do believe there is good news in the pipeline. Long term this is a good investment. The numbers behind the results were very encouraging too if you ignore the headline loss.

[jefftwo] 20/10/2015 22:12

I will be very surprised if this doesn't hit 10/11p after trading statementThe directors bought in for a reason as I previously stated.Totally immoral but within the stated rules.Will a TS be forthcoming?Of course and they know already what the numbers will be

[qs99] 20/10/2015 22:03

How much are earn-outs on top?

but if they do do £3m EbITDA, why should they be in 10 X vs others in the sector?

just questions rather than opinions.

Prefer TMMG if they deliver H2....and NFC if it dips below £2 DYOR etc

[markie7] 20/10/2015 21:50

Up to you. If they do get 3m then it will re rate of course.

[dbnout76] 20/10/2015 21:25

I'm sure your correct Markie7 and on that basis I will be selling first thing in the morning.

[markie7] 20/10/2015 19:14

Market cap £23m. Debt £7m before earn outs. So enterprise value of £30m.Forward prospective Ebitda of £3m gives a 10 times EV / ebitda multiple. No dividend. Not a compelling case at this price, but well done if you got in at 6p

[speedsgh] 20/10/2015 17:58

Of course they may decide not to issue a Trading Update seeing as it is no longer a regulatory requirement. That would rather ironic for a company that specialises in communication. Hopefully they will want to grasp every opportunity to get their message out there.

[guildedge] 20/10/2015 16:56

Well TS was 23rd october last year. So Wed/Thursday this week or next seems likely. I just think they would not do it so close to the Directors deals last week. So I am thinking next week Thursday. PR companies are all about timing.

Overall there appear to have been 2 trades today. Barely £1800 in total but both sells. My guess is most are waiting for the TS. Then the buyers/seller will come back. If it is good I expect 10p at least.

At some point Steffan will want to buy in if he is thinking of taking over David as CEO. Will happen sooner or later. Perhaps after the TS? The directors have timed them pretty well lately.

[salpara111] 20/10/2015 15:32

they issued a trading update around the end of October last year so I guess we will see if they choose to do so this time around.
I do get the impression that the seemingly never ending overhang has finally cleared given that we have not had any really big sells over the last few days.
As a result, if the next update is decent the share price could actually put on a sustainable rise.

[jefftwo] 19/10/2015 18:03

More bought than soldSo we could say a solid day

[guildedge] 19/10/2015 09:48

Falling on very low volume. 2 buys of 25k have just popped up. The 8-9p difference in price is just silly. The sell price can only be 8.5p or so. Unless a big trade has gone through. Not logged on to check actual live prices.

The share price should settle during the day. I think most people will accept 6p was an over reaction. 8-9p is much closer to the broker rating. A slight drift may tempt bigger buyers. We may also have a trading statement any time in next 2-3 weeks. Maybe Wednesday??? I truly have no idea when.

If someone truly wanted out at these prices they would be selling 100K+ not 10-20k trades. This is why I think big buyers may be more tempted as there seems to be no overhang.

[karm] 19/10/2015 09:40

Just pickup 100k.@8.99p .I was tempted. Should show up in an hour.,

[jefftwo] 19/10/2015 09:19

I'm tempted!!!!!

[dbnout76] 19/10/2015 07:39

Another week like last week will do very nicely please!

[guildedge] 18/10/2015 21:14

Jeff I think a lot of long term holders here are sitting on losses. My average is about 10.5 now. I have averaged done a few times here over the last 2 years. I am gutted I did not buy at 6p. Looking back it was a great entry point.

Yes for a big buyer to come in now it may need a big seller or a share issue. Who can tell how much stock the MM have left or have been holding back? I wonder if some deals have already been made? I actually thought the initial 19% rise on Friday was due to a large trade but none showed up. It's more likely because we have had 6-7 trading days of mostly buys of over 2-4M shares. On that kind of volume the MM have no choice but to raise the price. I think they must of had a lot of stock after the initial results and sell off. This could now be running out. Which could help the share price surge.

@Dbnout - No way to know if my friends are right. I trust them that this share will come good. DYOR.

Monday should be interesting. If this suddenly crashes back to 6p I will eat my hat. I really doubt this will happen with so many director buys lately.