Retec Share Discussion Threads

[wonder boy] 22/2/2007 14:46

... or unless some of the deep-pocketed directors beat you to it Dusseldorf. A few large buys from them in the coming weeks and the 5p target will look even more stupid than it does already.

[dusseldorf] 22/2/2007 14:33

indeed, the shares may become attractive. The trick is being able to sit out the period of development, without having money tied up - but making sure your money is in when it's time for a rise.....

I think I may be safe for at least another 6 - 12 months on the outside (unless a multi-million pound deal arrives)- will continue to watch with interest

[hastings] 22/2/2007 13:49

Well, we will just have to wait and see where the share price is in 12 months time Dusseldorf. Personally, i find guessing as to where we will/could/might be in 12 months time is best left to others. But, i would merely comment that turnover of £4.4mln this year will confirm the business is growing rapidly and should lead on to a decent profit in 2008. If and i say if, Retec can meet the expectations, then the shares would look very attractive at the current level on a Fundamental basis, imo of course.

[dusseldorf] 22/2/2007 13:05

I don't plan to just yet - don't see why an in house broker posting a buy recommendation with a target almost at current price can be considered upbeat.

My below estimate from two years ago appears to have been 'optimistic' given current performance (from ETS thread), timings are in fact behind my estimate by approx 1 yr as delay in aquisition

Dusseldorf - 4 Feb'05 - 16:22 - 488 of 666 edit


rmart - I was watching GON from the outside £1 down to 14p, as I've been caught in a couple of consolidations in previous years.


Imagine this (which is my honest interpretation) - ok, I'm not factoring in the swings for 'new orders' but its a typical life cyle of a new co to AIM:

the aquisition is effected and cash raised for working capital, most likely at 5p (0.05p now) post consolidation, the market cap equivalent for Retec, which lets face it, thats what ETS is, will be circa £4.5m at current price. The first financial result will be for ETS the shell and will not include any turnover / assets for Retec, hence will appear dreadful.

6 months gone

The next results show the first 6 months of retec turnover (and costs), but also the last 12 months loss of ETS the shell, most likely a larger combined loss. remember ETS has valued Retec at £1.5m, so I'd guess net assets are no larger than £1.5m. Now the loss making ETS, with Retec aquired is looking a tad overvalued at £4.5m

1 year goes by

The next results show orders are being won, but Retec is still to achieve its maiden profit, market is asked to provide extra cash resources in a further placing. Price heads towards Net AsseT Value which is equivalent of 3p, placing is effected below this as price falls.

18 months goes by

Retec finally reports a movement towards profit, though not yer

24 months goes by

Retec is in profit on a turnover of £4m. Market cap returns to around £4.5m which after 1 year placing ends up being 5p or 0.05p equivalent

so my money is on 5p or less in 1 years time (0.05p today equivalent)

[hastings] 22/2/2007 12:37

Then don't buy any Dusseldorf.

[dusseldorf] 22/2/2007 12:22

hastings - 5p easily achievable? of course it is, the offer is practically there anyway - nice to see the broker has little confidence in a rise. Now if they'd have said 10 - 12.5p it may have been of interest to new parties. Increasing losses albeit on approx 3.5 months out of 6 months of trading is not great, all it shows is that current sales do not cover costs (after essential investment) i.e. the business is currently loss making whilst trying to establish itself.

Only my 2 minute review of results, but don't see anything groundbreaking or to warrant purchasing any yet.

[hastings] 22/2/2007 09:47

No problem, will forward it later.

[masurenguy] 22/2/2007 09:43

Hastings - could you please email a copy to me
[e-mail]
Thanks

[hastings] 22/2/2007 09:39

Yes Masurenguy, just got it. A decent, more in depth note than previous. It states, significant underlying growth, broadly on course for full year with prospects remaining strong. Reiterating BUY with 5p easily achievable.

[masurenguy] 22/2/2007 09:19

Looks like they are making good progress in line with their prior trading update. Very important that an early stage company like this, particularly with new technology in an emerging business sub sector, builds credibility in the marketplace via a reliable and transparent newsflow.

Be very interesting to see an update from Nomad Charles Stanley, which should follow shortly !

[masurenguy] 22/2/2007 09:09

Robbie Balboa - 22 Feb'07 - 09:00 - 99 of 100 (Filtered)
Robbie Balboa - 22 Feb'07 - 09:00 - 100 of 100 (Filtered)

[robbie balboa] 22/2/2007 09:00

Sorry wrong thread.

[robbie balboa] 22/2/2007 09:00

Great thread chaps, a fascinating read.

Keep it coming!

[hastings] 22/2/2007 08:57

Interims look decent enough, confident forward looking statement, guess there will be a new Broker note out later today.

[ronnie14] 16/2/2007 15:28

CURRYPASTY

Thanks for that! I have indeed got 10084 shares in RET now, though they are still down by 2/3 on the price I paid to those B........s at Halewood!!
One day perhaps!!

[currypasty] 16/2/2007 09:24

At one stage there was a 100:1 consolidation

best click on news, and check the exact date of that, compared with the date on your cert

[ronnie14] 16/2/2007 09:12

I have a share certificate for 10084 shares in Elite Strategies. Please pardon my ignorance, but can anyone tell me how many shares in Retec this equates to , or is it the same number? Thanks in anticipation.

[entj] 09/2/2007 12:55

and possibly for other reasons too?

[hastings] 09/2/2007 12:52

Ticking up i see, as we head to the interims.

[veryniceperson] 08/2/2007 17:09

Hope that helps you Masurenguy, He does write some very good articles, surprised a daily or Sunday rag hasn't picked up on him. In fact with his articles he could teach them some of them. Just my opinion.

[masurenguy] 08/2/2007 16:56

vnp - Who was the author and were and when was this published ?

[veryniceperson] 08/2/2007 16:48

Just somethig of interest for shareholders



PENNY shares can often feature on the radar of retail investors, particularly with those dipping their toe in the water for the first time. However, many assume, and wrongly in a large number of cases, that because a stock stands at just a few pence, it is inherently cheap. Sadly, more often than not, a large proportion of these companies are struggling with debt, poor trading prospects and have little to recommend them.

It can also be the case that there are so many shares in issue, the market cap is already well up with events, therefore limiting upside.

That said, opportunities do exist and canny investors can and do make excellent gains from such stocks.

So this week I have decided to home in on one company in which I have recently made an investment that could possibly offer me some decent rewards over both the medium, or longer term.

The company in question, currently 4p a share, is based in Letchworth, Herts and trades under the name Retec Digital.

It came to the market less than six months back, having reversed into an outfit by the name of Elite Strategies, which had been something of a basket case, investing in various poor performing businesses, such as a failed do.commusic project and a financial advisory business. But, those legacies are now well in the past and Retec looks an interesting growth prospect that operates in an expanding market while trading with well known blue chip clients. The business itself revolves around a unique suite of software products that provide large retailers with media solutions in order to maximise their profits. This takes in a number of offerings, from interactive kiosks to broadcast and narrow cast screens that are suitable for various situations in stores. In fact, most reading this article, although unaware, will have seen the products on display in the likes of Boots, Sainsbury's, and Tesco, where Retec has supplied a number of screens across the UK.

The company also has a strong relationship with big hitter IBM, which sees Retec incorporating its products into self service kiosks, a market that has been evolving since the mid nineties and continues to expand, experiencing strong growth.

That Retec is already working with the big and well established names should certainly auger well for the future and it would appear that the market has yet to wake up to the potential upside of the shares, which currently values the company at around £5m.

In terms of revenues, more should become clear when the interim results are announced later this month and this could be a trigger for kick-starting the shares.

A taste of Retec's potential is highlighted by a three year deal with Sainsbury's, Retec supplying a number of products to the stores entertainment zone and earning its revenue from film and music trailers along with general advertising.

There is also a significant contract with Tesco which sees Retec earning their money directly from selling the products.

These apart, other notable deals have been announced with Argos and Woolworths, where Retec has already delivered 400 units.

Importantly, the company has recently given a trading update which stated that it had enjoyed a busy period, winning further contracts both with and without partner IBM.

In addition, the board stated that it was looking forward with confidence, which in turn was reiterated by chief executive John Cole when we spoke last week: "Business is going very well," he told me, adding, "the company is experiencing lots of activity."

It is also pleasing to see the likes of chairman Sir Brian Ivory on hand, who was appointed at the time of the reverse take-over and who boasts a wealth of experience, sitting on a number of blue chip boards including HBOS.

As for the future, broker Charles Stanley currently has a "Strong Buy" note out on the stock and forecasts a decent move into profit next year, with a pre-tax figure close to £1m. That would see EPS of 0.7, equating to a forward PER of under 6. Even allowing for some slippage on that figure, the shares look very good value me, particularly as the average PER in the sector stands at 16.

Of course, like many new kids on the block, Retec has yet to deliver, but it appears to have much going for it with two distinct formulas for generating substantial revenues in the coming years. It also appears keen to push hard in order to generate significant returns.

Update on two recent subjects. Firstly, Real Good Food Group, which I featured early last month at 54p. Nice to see it dish up a good short term return with the shares now at 72p. While the oddly named Hat Pin, a subject three weeks back at 78p, is also climbing steadily north now standing at 91p.

[Abuse team] 07/2/2007 09:16

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