Touchstar Share Discussion Threads

[arthur_lame_stocks] 29/5/2020 07:52

The business is not cash generative. If it wasn't for positive working capital movements, which can't be repeated forever, the company would have consumed cash. It has also benefitted from a tax rebate.

For the life of me I fail to see why people are so enamoured with this stock, it only turns over £7m a year and assuming a net profit margin of 5% that gives a potential for profit of £350k a year thus entirely justifying the current market cap.

This stock has been a dog for years and unless they can significantly grow the top line and start to make some real profit and really start to generate some cash then it remains overvalued imo.

[bio_tango] 29/5/2020 00:03

With the cash generative nature of the business and the optimised cost base, TST may well become a takeover target. It will give the predator access to the new products, which are proving extremely popular as evidenced by the 350% increase in order book.
Considering the illiquid nature of the business, a takeover at a significant premium could be the ultimate end game for Ian Martin, who owns close to 10% of the shares. As a reminder, Ian Martin was key to Avesco's takeover. Very well respected individual.

[rivaldo] 28/5/2020 23:04

In summary, TST has a mere £3.6m m/cap. Yet:

(1) it has approaching £1m net cash
(2) it was profitable in Q1'20 and in April just gone - even despite the pandemic
(3) it has high recurring licence income
(4) it's reduced costs considerably over the last year
(5) the order book has increased over 300% year on year
(6) over 70% of revenues derive from "essential services" as defined by the Government, i.e the NHS, care homes, food factories etc

Enough said.

[allviewswelcome] 28/5/2020 22:05

I agree with a lot of the posts today. Considering the current environment, the results today were very good. To be generating cash in April is an excellent result. The market cap of this company considering the revenues and cash in the bank is currently priced at a level for company that's expected to fail, which it clearly isn't at the moment. It's just a shame the MM's shut it down whenever there's some demand. To get some liquidity they'll have to lift the price eventually.

[likitorma] 28/5/2020 14:41

No buys since 10 40 this morning. Sellers will appear, they always do. Doubt there is anyone with the firepower to take out the ask, except me.

[likitorma] 28/5/2020 14:00

The big gun buyers are yet to appear. Until they do, I can patiently wait for sellers. I hope that chairman does not put a buy order.

[rivaldo] 28/5/2020 13:41

You may be waiting for a very long time likitorma :o))

I was one of those early topper-uppers with a couple of buys, and have every intention of holding for some time yet.

[likitorma] 28/5/2020 13:14

Waiting for a few of today buyers to sell up first.

[cocker] 28/5/2020 13:06

I thought you said odx profit was coming here?. Best get in before the next leg up ?

[2toptrader] 28/5/2020 11:46

Very well run co, I don't understand why it doesn't have a bigger fan base.

[jeevsje] 28/5/2020 10:11

The cash generating nature of the business is actually very impressive. So pleased to see a high percentage of the revenue is recurring. Very impressed with the way they have handled H1, esp with Covid 19 situation.

[pavey ark] 28/5/2020 10:03

Really excellent results.

Don't forget the recurring licence income that the company receives.

This small company is in absolutely the right place at the right time.

Large proportion of market cap is cash, considerable rate of increase in revenue, reducing costs and rising margins/profits.

[likitorma] 28/5/2020 09:58

Order book at Yr end increased by more than 300%. That is very impressive and shows new products are in demand.
Cash £850k and no debt.
ODX profit coming here.

[rivaldo] 28/5/2020 09:50

Moving fast now - there are a maximum of just 8k shares available to buy online at 45p at present.

[rivaldo] 28/5/2020 08:14

Agreed - an excellent statement.

Apart from the surprisingly good current trading, with a profitable Q1 and April being profitable too, the cash pile should now be approaching £1m given that profitability - a third of the £3m m/cap.

And that should improve further assuming the CBILS application is approved.

70% of revenues are "essential services", including the NHS, care homes, food factories etc.

TST are in a very good position to come through this crisis in a strong position, and may be able to take advantage as the economy recovers, especially if competitors are weakened.

You can't even buy 1k shares online - any demand and the price should move very nicely.

[cocker] 28/5/2020 07:35

Well I think we can agree that given the current situation TST has done rather well

[microscope] 28/5/2020 07:34

Decent order book and cash position but still a loss and the the ongoing hit from Covid obviously not on the balance sheet yet. Probably a decent risk/reward play but he says it could be 18 months before things normalize.

[jeevsje] 28/5/2020 07:33

Very good results and Q1 profitable even better than expected. This is currently priced to fail and could easily do 300% to 400% rise, just on those numbers. Remember Ian was buying shares in his last company at 50p and subsequently sold the business at above 600p.

[likitorma] 28/5/2020 07:19

Impressive set of results and beating myself for not buying prior to results. Looks well undervalued and will look to invest ODX profits in Touchstar.

[cocker] 28/5/2020 07:15

Profit Q1 and still taking orders. Staff helping by lowering salaries and cash in the bank. Not really sure Ian could have done much more than he has, so strong hold for me.

[likitorma] 27/5/2020 18:26

Apparently, results tommorrow.

[cocker] 27/5/2020 18:19

When would you like them?