Security Res. Share Discussion Threads

[cfro] 11/11/2014 16:20

EezyMunny,

Pretty hard to buy any, huh?


You're telling me!!

That was my purchase of 6000 earlier @55p. I literally had to wrestle the market maker to the floor to even get that amount at that price.

I fink he's alright, he has got up now. ;-)

[gucci] 11/11/2014 15:35

heading back to 65 sharpish

[eezymunny] 11/11/2014 15:28

I see Naked Trader bought these in Feb.

If he mentions them in his update tomorrow it'll be fun.

Hopefully he'll keep his trap shut as it's really too illiquid to lure in all his merry followers.

[fido] 11/11/2014 15:27

Tight stock.
No sellers and very little buying needed to push it up.
Company saying things are looking good with prospects of orders worldwide including some like the MOD contract that would be chunky for a small cap company like SRG.
No wonder the share price is going up.

[eezymunny] 11/11/2014 15:20

Pretty hard to buy any, huh?

I added a miserable 6k today and had an order in for more but no sellers it seems....

[interceptor2] 11/11/2014 14:18

I wondered who was the other buyer today, it seems that my small top up that followed was enough to give the share price a nudge :o)

Imagine the reaction if any buys came in if these are mentioned somewhere.

Is that a double bottom I see on the chart?

[battlebus2] 11/11/2014 13:11

Adding again, I reckon 80p is a fair target on the results just gone but the potential for more upside is greater imv.

[meijiman] 08/11/2014 10:52

Yes that valuation can't be too far out as a broad brush potential forward valuation. Perhaps the main negative is that funds don't like conglomerates -even mini conglomerates. Security looks like it could be the focus -the good news is that they are under no pressure to sell anything so might achieve good prices on any disposal. Picked up stock at 47p.

[fido] 06/11/2014 11:53

yump,
Longer term I see the packaging and property businesses being sold off resulting in special dividends for shareholders with the security business being the focus.

[yump] 06/11/2014 11:28

I've been buying a few of these and its been very helpful to see the discussion earlier, esp. figures etc.

Presumably the lowly rating is partly because its difficult to categorise the company as a whole. Unless one of the businesses starts consistently growing (obvious one is the security business). Then the others might be sold off ?

Unless they just like running different businesses. I guess its more interesting than just banging out boxes.

[fido] 06/11/2014 10:20

EezyMunny,
Security is perhaps the number one concern of world nations, so the fact that Audiotel is selling its security devices into that market gives confidence of bigger contracts going forward. When that happens we will see a substantial re rating here.

[eezymunny] 06/11/2014 10:11

Worth a stab at a valuation I think.

Op profit b4 amort charge and exceptionals (which were +£113k!!) in H1 was £891k.

If they only repeat that in H2 that would be £1,782,000 for the year. Apply a 20% tax rate and you get £1,425,000 post tax for the year.

We can only stab at a fair P/E ratio given the lumpy nature of the Audiotel biz etc but I'd have thought 10 was reasonable.

So that gives a fair value of £14.25m for the businesses.

Reasonable also I think to add the whole cash pile to that valuation, which would be about £4.5m at year end if trading in H2=H1.

Even without the cash pile they'd have a very strong working capital position (quick ratio c. 1.5).

So a reasonable valuation £18.75m or 90p/share. It just looks much too cheap here to me.

Obviously things could go wrong. Downturn in trading in any/all of the divisions. Regulatory changes in property searches (esp the daft EPC stuff).

However balancing those downside risks vs the "the outlook for the Group is decidedly positive" and just the half chance of another monster order from the MOD (or other gov) and the risk/reward looks awfully tilted in our favour here.

Any thoughts?

[gucci] 05/11/2014 22:30

joined the gang here today

[fido] 05/11/2014 18:07

From Proactive:

"Security Research Group profits surge as surveillance demand climbs
By Andrew Neil November 05 2014, 1:28pm
Security Research Group (LON:SGR) shares jumped 17% as the electronic surveillance and property services firm accompanied a significant increase in half-year earnings with a bullish full year outlook.

The company (formerly known as PSG solutions) runs an unusual mix of businesses that includes electronics, financial services and product packaging.

Group pre-tax profit of £798,000 was more than three times last year’s comparable £219,000 with subsidiaries Specialist Electronics and Property Information Services the major contributors.

Its Specialist Electronics unit, which sells IED detectors to the military and bugging devices to police forces, recorded an operating profit of £274,000, up from £7,000.

The division was helped by a £268,000 deal with Australian homeland security services for its ‘SuperBroom217; handheld detectors.

The company also received a £120,000 order from the Egyptian government for its Archway systems, which can detect a wide range of active electronic devices including mobile phones, electronic detonators and covert surveillance devices.

A number of other products are currently at the prototype stage, including a `personal surveillance scanner' and a handheld electronics detector, which can be used for body searches.

Finance director John Warwick said the company plans to sell its scanning devices to the casino market, which is encountering a new breed of tech savvy gamblers looking to beat the system.

Elsewhere, the firm’s Property Information Services unit lifted operating profit to £598,000, up from £368,000 as the booming housing market sparked more house sale transactions.

Packaging subsidiary Moores and Buckle chipped in an operating profit £169,000 (£123,000).

Chairman Jonathan Mervis said that he is confident that with improving performance in each of its divisions the outlook for the group is ‘decidedly positive’.

Shares rose by 7p to reach 48p in mid-morning trading".

[fido] 05/11/2014 09:33

"Following a review of specialist electronics activities we intend to increase
our resource in both the sales and technical departments so enhancing our
expertise in the development and marketing of mobile device apps which can be
linked to our product ranges".

"Plans are under consideration to extend the PSG brand to deliver a wider range
of different legal services"

SRG are now building up their resource base and will be doing so for one reason only, that they see a good future ahead.
People are right in saying that a large contract could be transformational to the company just as the MOD contract was, and that could come at any time especially as you can see from these results, Audiotel`s sales are now worldwide in a world that is becoming more insecure and needing of Audiotels products.

[eezymunny] 05/11/2014 09:18

As I say on the EezyMunny thread PJ, a weird conglomerate.

I guess all 3 divisions may not trade as well in future but the outlook statement sounds very bullish. Worth noting the huge MOD order that was completed a while back. No idea whether any likelihood of anything similar in future but just at current trading levels group-wide, and with the very strong balance sheet, there ain't anything much cheaper than this around at the mo.

[pj 1] 05/11/2014 09:11

Never heard of 'em Eeezy

Another Vislink....VLK..?

apols, wrong thread!

[eezymunny] 05/11/2014 08:44

Bought some for the EEZY2 portfolio today.

Seem awfully, awfully cheap here unless I've missed something...

[wjccghcc] 05/11/2014 08:43

It looks like Audiotel is actually building a sustainable business after the expiry of the MoD contract. Yes, it will be lumpy but a PE of 7, 40% of the mkt cap in net cash and EV/FCF of less than 3 makes it one to tuck away for me.

[interceptor2] 05/11/2014 08:30

There are certainly some well respected faces here already :o)

There seemed to be some competition this morning to buy stock, first time I have looked at this company and very much liked today's results and the fundamentals.

It had crossed my mind that SRG could receive a huge contract at any time when I looked at their history.

[battlebus2] 05/11/2014 08:15

indeed IC2, great to see new faces.

[stegrego] 05/11/2014 08:14

Good to see these performing.

Added at the off. Could get a massive one off contract at any point, plus the cash plus the eps.

Billy bargain.

[shanklin] 05/11/2014 08:11

SRG looks interesting. Added to my watch-list. Knew nothing about them at 7 a.m. and didn't feel I was sufficiently up to speed to buy first thing.

[interceptor2] 05/11/2014 08:10

Interesting news here this morning :o))

[wjccghcc] 05/11/2014 08:09

Yes, bought a bunch. Very cheap on a cash-flow basis.