Shearwater Share Discussion Threads

[channel pirate] 26/1/2019 10:36

They (B.O.D) must also act to do something that will bring the share price back to at least the "open offer price" of 3.60p. The last time the share price was at 3.60p was Monday 22nd October 2018, which was a couple of days after the open offer shares started trading. Since then (just over 3 MONTHS now) the share price has dropped lower and will remain down at these levels imo unless we get some sustained share buying coupled with the company being more communicative to it's shareholders with more regular positive trading news. Not to much to ask surely.

[hierarch] 23/1/2019 13:03

Rockstar

Agreed they themselves acknowledge how fragmented the market is and have directed their aquire and grow strategy in an attempt to consolidate these small resilience firms into one holding as the SWG group.

It is unfortunate to see no obvious actions to suggest they are consolidating the companies they have acquired thus far into one multi disciplined, multi service operation.

Why buy multiple fragmented services to leave them in their fragmented states. This is the exact reason they remain small companies offering a condensed niche product that cannot offer a comprehensive security offering and instead provide stop gaps or add ons to other companies security products! This is an underwhelmeing exploitation of there own assets.

They ultimately must act to combine them into a powerful brand machine and market a consolidated offering from geolang brookcourt xcina ect into one company with one purpose - to single handedly offer a comprehensive security platform for a client not bits of security from different companies as they are insistent on facilitating now.

[rockstar10] 23/1/2019 12:37

As mentioned previously by others I think progress should be evident or not when we see the next financial statements. I would agree that they may have overpaid for certain acquisitions but having done some digging I am concerned over the apparent lack of cohesion from a marketing viewpoint among the various operating units. It seems they each have some big name clients but efforts to cross sell products appears lacking which is disappointing.
Whilst the SWG board has some good names it doesn’t naturally mean they get it right all the time. Let’s see but I think that the operational executive board is long on friends and colleagues of the CEO from previous employment which may or not be a good thing!,

[nw99] 18/1/2019 22:58

Big director buys recently follow the money

[2lb] 18/1/2019 20:53

Intersting debate today.

Todays news is a bit of a non-event, it won't generate any material revenue but it's about generally getting wider exposure and reach for the fuller range of services.


All eyes on the next finacials and the level of profitability (or not).

Further acqusitions are going to turn the number of issued shares into the comedy territory thus making any material gain very tricky - but they need to be done beacuse


a) that's the strategy and

b) they've massivley overpaid for very average businesses to date.


The BoD may be clever and well connected , but they ae palying in an area they actually know little about in repsect of cyber M&A.

[nw99] 18/1/2019 18:59

I am still very bullish on this going to be a big winner and the cogs lined up for a great 2019

[channel pirate] 18/1/2019 15:55

Hierarch,

Circa 1M with a B/E of 4.1p (opps just had to amend taking into account profit already taken 3.9p). I have stopped buying anymore SWG for now.

I hope this investment will replenish all I lost back in 2009 after entertaining an M.D. and his wife of a Gold Mining Company for the week-end in my own home. I was then invited to participate in a placing offered by his company. I did - the company then de-listed from AIM 3 months later never to trade again - Total Loss to me - £250,000. There are no printable words to express my feelings then, or even now !!

[channel pirate] 18/1/2019 15:32

Hi cheeky,

Not expecting 8p any time soon, but you have to have an initial plan, albeit it may have to be tweaked as we travel along.

Thanks for the link - will take a look.

[hierarch] 18/1/2019 15:28

C.p
Agreed BOD cash cow worries are subsided by your point that it would be damaging to them as valuable people.
This seems a good strategy depending on the entry price you paid (on average).

Cheeky
I am interested for you to elaborate what you can share with us about this “technology221; and why it carry’s such high magnitude as to how well it will contribute to the company. I agree that the board is also highly influential in the industry - again the main reason I’m excited about this is to observe the developments over time and how they implement thier strategy.

I shall remain an observer until I see more value. I will be sure to share my thoughts on when I believe that will be and why when I’m more confident in SWG.

[cheekyfella] 18/1/2019 15:23

there you go CP - same ish as me - not sure 8p is doable in 2019/20 though
be interesting to see a well-researched broker note within Q1
don't think SWGs pr company are up to much which is a shame given the wealth of opportunity this market sector brings.

if you're not aware of it hxxps://www.teiss.co.uk/ is a great online newspaper to follow developments in cyber security

[channel pirate] 18/1/2019 15:17

Hierarch

Arguments for both investing now and also waiting to see what happens. Let's hope the Company is not just seen as a "cash cow" to be milked by the B.O.D. I don't think that would do reputations any good !!

My current strategy is to see the share price get to around the 8p mark, sell 50% of my holding, and then sit on the remaining 50% as a "free carry" all sitting in my ISA

[cheekyfella] 18/1/2019 15:11

Hierarch, The reason I invested is because I work for a company that has developed a technology which is being utilised by an SWG co. SWG have a long-term strategic vision and a board capable of influencing at the highest level. This isn't a short-term play for me. My intention is to trade myself into a position where I have a substantial 'free' holding and leave that alone for 10 years.

[hierarch] 18/1/2019 14:58

C.p
This is a good perspective, I too am mainly interested due to the exceptional composition of the board.

Although there is danger in drawing parallels between how Microsoft and Apple are similar to that of SWG in their startup phase.

The main reason bieng when apple and Microsoft where start ups there was no such thing as an established player in the computer or internet industry - they where pioneers. SWG is born into huge competition In it’s own industry. Apple and Microsoft where born into an unknown world with only other tiny speculative competitors trying to be the first to establish the digital industry itself.

I’m sure the powerful connections the board members possess will enable them to make some exciting acquisitions in the future but if they cannot consolidate these offerings to entice large companies we have a problem. Another issue preventing me from buying until further value is added is the pay afforded to the board. This is not an ideal time to be increasing the pay of a certain executive by a factor of two ~150k (2016) to ~320k (2017) especially when the group remains loss making. Whether this salary is justified or not however will be argued by time. I understand you pay for what you get and what they have as a board is incredible but they should not be doubling executive pay if profits aren’t doubling either.

[channel pirate] 18/1/2019 14:30

Hierarch what you say does make sense, however, SWG are a "new start-up" as you will be well aware, as were the likes of Microsoft, Apple etc years ago when they stared up, and never had their own mega security structures I feel sure.

My View (for what it's worth):

Shearwater do risk finding it hard going being up against bigger and more established security companies I am sure, but if every new "start-up" were to think - ah there are bigger and better companies doing this already - then there would be no "new blood" coming into the arena.

One advantage Shearwater has as a new "start-up company" is the pedigree / knowledge / experience of security that the assembled (and still assembling) Board of Directors have amassed over the years they have been engaged with other companies. They have now come together to share their knowledge etc, in hopefully building their own successful Business Group in the Cyber Security arena, which will obviously take some time (Rome was not built in a day so as to say).

By investing now in Shearwater Group at this small share price is a big risk for any of us small pi's, but if the gamble comes off (for both Shearwater and us) we will of all made a nice return on our investment in the future.

I have a current holding of circa 1M shares. c.p.

[hierarch] 18/1/2019 13:21

Out of interest cheeky what merits do you attribute to the company which entice you to invest? And to what level are you invested. I am interested in what other people perceive in the companies prospectus.

[hierarch] 18/1/2019 13:18

I am merely waiting upon the sidelines to observe wether the stock generates investment value. Currently it is extremely risky compared to others in its class and the main interest point for me is the question of if an exceptionally well qualified board can leverage itself effectively with such a small position.
I’m not negative about this stock, only curious as to how detrimentally it will either; fail or succeed...

[cheekyfella] 18/1/2019 13:09

Hierarch, you'd better sell up quick then... that's if you're invested?

[hierarch] 18/1/2019 12:37

News unlikely to manifest into any high magnitude of share price movement - having a quick glance at Moonhouse’ financial credentials the company turned over only 7m 2017, with a profit of just 500k. A step for SWG for sure however I remain sceptical about how such a dealing with a small insurance group will generate the badly needed exposure to a larger client base. Especially when we have the unfortunate circumstance where we have far too many highly complacent mid-small businesses not employing sufficient cyber security/data resilience infrastructure - this will only change with a significant catalyst e.g large volume security compromises/hacking for such companies and additional government intervention/laws surrounding minimum best practice of data protection/security.

We must realise that hackers generally target large businesses firstly due to the fact those responsible often want to satisfy the ego of ability to hack such well-known and large buissness - secondly because they are far richer in commercially sensitive information that leads to greater profit for them. Mid-small business are targeted for small gain/ransom however they lack advanced digital security and represent an easier target.

The problem with this is that the media is unlikely to cause a stir because an unknown small/mid sized business was hacked unless it was a significant co-ordinated and highly malicious effort by the instigating hacking group. Of which such advanced hacking groups would only likely target large businesses who as stated before bare sufficient fruit to warrent the worth of risking compromising themselves and there groups other activities. Hence it would be extremely stupid for a hacking group to risk themselves to attack a small/mid sized business for small gain. Media will be the main influence on how seriously a small/mid sized business will take their own digital resilience and currently they will remain thinking that they are immune as a small/mid buisness until something extraordinary within the current hacking demographic occurs - this may take some years

therefore
SWG must act to establish a ROBUST service offering to a large company to start gaining exposure. This however will be difficult and the company is competing with huge well known trusted long established companies such as CCC. The other problem is large companies often employ there own centralised cyber security assets and personelle and SWG will only be able to offer slight augmentations to there existing security assets if there product is both none-generic and superior to their own. Take Microsoft for instance; they own and operate two-factor authentication,robust networks of security experts and passive data monitoring systems augmented to there own cloud systems. Why would they barter for SWG services?
In addition why would another business utilise SWG services over Microsoft?
Would you utilise SWG or Microsoft for two factor authentication as a CIO?

SWG really needs to revolutionise digital resilience to become significant in this industry they are not well known and currently their assets are relatively generic. I hope the highly qualified board leverages it’s insflunce to acquire a highly innovative product that it can tempt large enterprises into, currently the Cisco deal is a start however the company must consolidate its fragmented offerings into one powerful service based platform to be taken seriously.

When this is realised then the company will be capable of tricking down to other large enterprises which is the main ball game in this industry. Otherwise they will provide only small increments of growth as they establish more and more small contracts which fail to activate any significant growth in the company. This will result in them becoming engulfed by other competitors who advance at a higher and faster rate and who already have significant footholds and diversified portfolios as companies.
Hopefully we will see SWG engaging with the big boys but until they come up with a catalyst which I’m sure such highly influential directors can spark we are on life support of small deals and insignificant growth.

[channel pirate] 18/1/2019 10:03

Morning cheeky,

yes I think the news will primarily help the share price avoid sliding more rather than making it rise. I think the mm's would like to hear news on how much income the company is producing before it will move the share price from around this price.

[cheekyfella] 18/1/2019 09:27

There you go cp - as if by magic, more news :-)

[cheekyfella] 17/1/2019 17:06

Good result with MCM cp.
Yes, very quiet here - but that's fine.
More news soon - adding under 3p could be rewarding though.

[channel pirate] 17/1/2019 07:46

Morning cheeky, expect you are still looking in albeit the 'board' has been quiet for a couple of weeks.

Off topic, remember on 21st Dec I said a share to keep an eye on in 2019 was MCM. Well in just under a month it has climbed 50%, with a lot more still to come during 2019, but the shares are becoming more difficult to buy some days now, and you can't buy in any 'large' volumes.

Unfortunately I had to sell 10% of my holding there this week to pay a Capital Gains Tax Bill, as deciding not to sell any SWG in the hope we get some news here before too long which will hopefully at the least get us back to the last 'placing' price.....

Happy New Year and have a good 2019 everyone - C.P.

[husbod] 03/1/2019 19:32

Cheeky - US market was ridiculously overvalued particularly the tech titans so there's a strong argument that this correction is a return to reality which isn't a bad thing.The UK market has not seen the same meteoric rise but is now suffering from Brexit worries. However it seems to me that with yields of 5 percent there are opportunities in our market for the brave.As to our Company it's certainly in the right sector and it's good to see the share price going up for a change.

[jammytass] 03/1/2019 19:01

new contracts on way?

[cheekyfella] 03/1/2019 17:16

It's going to be a bumpy ride though CP. The US market's troubles are kicking off again.Plenty of black swan events... Apple's troubles having a ripple effect.Trade warNo deal BrexitThe good news for SWG holders is that the business shouldn't be affected by an economic downturn principally because hackers aren't... they just keep trying to develop new ways to hack.