Tclarke Share Discussion Threads

[squarepeg86] 04/4/2019 12:34

Don't get me wrong, I completely agree with you, but this isn't something that we didn't already know. We knew from the trading update and all the recent order wins that things were going very well, and yet it climbed to near 120 and then dropped back to 100 between the update and results. I am confident that my money is in a good place and we will continue to see a rise in the long term, but with the current uncertainty, a lot of investors sitting on cash and a big seller in the background I won't be surprised if this drops off before picking up again. My point was really that there seems to be a lot of excitement here at the minute with people watching every little price movement expecting a rise. Personally I think we've had the rise for now and I expect the pull back from here in the short term. My money is staying where it is, I don't think I'll get in anywhere near the price that I did again.

[cc2014] 04/4/2019 12:21

After such a quick rise it's inevitable the share price will pull back before it rises again. The challenge of course is whether you sell now and try to buy back cheaper and risk missing the next big move, or whether you just sit tight and ignore the short term noise.

[cc2014] 03/4/2019 22:50

I think we shouldn't underestimate the results Squarepegs. In these uncertain Brexit times the directors have said based on the current order book they are comfortable they can deliver this years numbers and they strike a positive tone for 2020 as well.

So, you get a certainty over the numbers, a low P/E and a decent dividend yield.


If Brexit ever gets sorted one imagines there is a flood of projects which have been held back which will come on the market.

[lasmo] 03/4/2019 19:15

I have to agree with Tuscan, IMHO CTO is very exposed to a Venture Capitalist buyout. It ticks all their boxes. Cash generating to service the additional debt, a management team which can be incentivised with sweet equity (currently they are holding v little stock), a credible tech strategy which should lift the multiple, a strategy which takes them higher up the value chain, a solid brand and enviable market position.

[effortless cool] 03/4/2019 17:26

My forecasts for CTO are shown below, with broker consensus figures (where available) in brackets
- Revenue. 2019: £339.7m (£340.1m), 2020: £351.2m (£360.1m)
- Reported net profit. 2019 £7.8m, 2020: £9.7m
- Adjusted net profit. 2019: £8.0m], 2020: £9.8m
- EPS reported. 2019: 18.2p, 2020: 22.3p
- EPS adjusted. 2019: 17.8p (17.5p), 2020: 21.9p (18.6p)
- DPS. 2019: 4.4p (4.4p), 2020: 4.7p (4.8p)
- Net cash. 2019: £19.6m, 2020 £28.1m
- Pension deficit: 2019: £21.5m, 2020: £20.0m

Note that I am incorporating a degree of prudence by setting my revenue projections somewhat below consensus, particularly for 2020. My EPS figures are higher than consensus, however, suggesting to me that they are being overcautious on operating margins.

What is particularly notable on my projections is that CTO will be throwing off cash. This indicates that it could certainly afford a higher dividend than I am assuming. I suspect it will also increase the pressure on it to up the payments against its pension deficit. (Either action is valuation neutral to my model).

My new valuation is 147p per share. At 17% above the current price of 126p, this is still a weak BUY for me, in spite of its excellent recent run.

[squarepeg86] 03/4/2019 17:15

After being invested here for over a year now (which I know is very short term compared to some) I've realised that this share moves very little and will probably drop somewhat before any more news. The rise is very recent and it's spent most of the last year in the 80's. I can't see any bigger publicity than the full year results and the IC article's, so I personally expect a drop now before more news bringing the buys in, especially with the big seller still in the background. Happy to be proved wrong though.

[master rsi] 03/4/2019 16:47

Another day of not much happening, the volume is not reaching much ground and with that share price just up 1p and down 1p.

Time to look at Indicators on the time cycle, they must be on the upper side of the equation.

[owenski] 03/4/2019 14:33

CC2014. Super article, CTO aiming for best in class next generation office facility via smart building tech. A good business differentiator and a show case for CTO. Still looking good value here.

[cc2014] 03/4/2019 09:00

Definitely worth a read

[jeff h] 02/4/2019 15:58

Another future large contract for CTO to have a go at:-

[cielos] 02/4/2019 15:52

CTO Stock Is Going Nowhere Fast Today

A flat day alright, and after the large sell 30K then 35k yesterday, and smaller ones again today, on seeing the bid is only supported with 100 shares most of the time.
I sold not long ago for a good profit in less than 2 weeks.

[from8to800] 02/4/2019 15:48

Welcomed sellers as they are needed to make the growth sustainable. Prefer to have a steady growth in share price than a wicked ride up with catastrophic/volatile crashes.

[master rsi] 02/4/2019 11:57

It looks like the rise is having a pause today, plenty of sells on the ticker

[davidosh] 02/4/2019 03:28

Looks like there are quite a few questions for management and the share price is now moving well ahead which pleases me as a very long term holder.

Just a reminder that T.Clarke will be exhibiting and presenting at the Mello2019 event on Thursday 16th May



They will be doing two presentations so one in the morning and one afternoon.

More info and tickets here...

If you want a 30% discount you can use this code in the box ADVFN30

[master rsi] 01/4/2019 23:03

That is how it looks the 16 years chart
The UP then down and now UP again

[master rsi] 01/4/2019 22:19

April Fools' Day

The uncertain origins of a foolish day

April Fools' Day, sometimes called All Fools' Day, is one
of the most light-hearted days of the year. Its origins
are uncertain.

Some see it as a celebration related to the turn of the
seasons, while others believe it stems from the adoption
of a new calendar.

[edmundshaw] 01/4/2019 19:13

CC2014 generous of you to share your analysis. I can think of worse worst case scenarios, I would say a PER of 10 and dividends rising by 10% for the next 2 years looks reasonable, but hardly worst case. Worst case is something like Interserve's suicidal contract on Energy-to-Waste, but of course there is nothing we can do as investors when a company throws all contracting caution to the wind like that (and yes I was somewhat burned by that one - I was a bit slow to sell out because of prior years of good performance); you have to assume that kind of thing is rare and unlikely, but it does exemplify the ever-present risk of one or two seriously onerous contracts. More realistically, downturns, however, and increased competition in a very interesting developing high tech space could squeeze margins in the medium term... Nevertheless, the potential upside is truly dramatic!

[muckshifter] 01/4/2019 18:05

It is worth remembering, imo, that CTO managed to continue making a profit albeit a reduced one, in the exceptional circumstances that followed the financial crisis.

Two things worth remembering about that difficult spell:-

Balfour Beatty were competing with CTO as an electrical / mechanical contractor in the London region at that time, and lost many millions attributed to their electrical contracting London division - have a look at BBY's RNSs about the huge multi million losses at that time - ie. CTO still managed to make a profit in the face of completely unrealistic competition by a huge contractor with very deep pockets, which says a lot for their reputation and standing with clients, I believe.

Secondly, during that spell someone was milking the contracts. IIRC, there was about £1.6m that CTO expected to get back, but you can be sure that the milking cost them much more, probably several times, the amount they can get back.

[edmundshaw] 01/4/2019 17:47

Thanks for the replies.

I have to say I am more interested in forward projections than looking into a rather different past. As tuscan says, CTO is moving up the value chain and with the Zeitgeist of building technology.

I am very positive about its prospects, but not because they used to be three quid a decade and a half ago... or even their longevity stretching back to 1881. After all Debenhams goes back to 1778 and the share price has been 40 times higher than it is today, but I am not very keen on investing there!

[tuscan4] 01/4/2019 17:02

Thanks CC2014,
Comparisons with early 2000's can be misleading. CTO was a pure electrical contractor in those days, throwing off surplus cash which went to augment its nationwide collection of small electrical contractors, all bought ad-hoc, with little strategic focus. With minimal pension fund commitments and little need for working capital they were very generous with the dividend. Hence the share price spike.

Everything changed with the 2008 recession. Legacy contracts maintained profits for a few years,then margins were decimated. CTO changed its business model to survive, the fruits of which are now emerging. Margins are rebuilding but will not go back to earlier levels. The pension fund deficit will, I believe, fall away over the next few years. CTo is moving up the value chain and is building a moat to differentiate itself from the competition.

CTO directors are rewarding themselves, possibly excessively , for the change in the company's market position. Shareholders received the bulk of the fruits of the earlier prosperity. Now the Directors are in pole position. To me this is a very vulnerable company to a private equity offer.

[cc2014] 01/4/2019 16:37

since I'm in a good mood this may help you Edmundshaw. ADVFN always adjusts the charts for share price splits and marks them with a sliver diamond.

[edmundshaw] 01/4/2019 16:01

But what kind of beast was T Clarke in 2005? And was it overvalued? And what was the number of shares in issue?

Not wanting to be negative, but just looking at the share price back then in isolation doesn't tell me much...

[hsduk101] 01/4/2019 15:32

Even better, didnt spot that. Surely the buyers will see that also and look at that as potential

[cc2014] 01/4/2019 14:55

The all time high is nearer 300p

[hsduk101] 01/4/2019 14:38

Just looked at the 10 year chart on this baby. Was originally as high as £2.44. Look at the financials then, they werent as great as last months figures.So this is great news!

Could we potentially double our money!!?