Touchstar Share Discussion Threads

[rivaldo] 25/4/2023 11:37

News today of an upgrade contract win which will benefit this coming H2:



Extracts:

"Carnegie Fuels - upgrade to Touchstar Android devices
25 April 2023"

"Carnegie began its relationship with TouchStar in 2017 when they were looking for an improvement to their paper ticketing system. TouchStar focuses on providing practical and effective business solutions, through its FuelStar hardware and software technology to eliminate paperwork and streamline communications between drivers and administrative teams. Carnegie Fuels adopted software from Fuelsoft as their back-end administration package and utilised Touchstar’s Fuelstar app and Windows-based Hawk devices to provide a real-time data feed from the vehicle fleet.

Every vehicle in their fuel distribution fleet uses TouchStar technology as an integral part of their delivery processes."

"The Upgrade

TouchStar has now been commissioned to upgrade the entire Carnegie fleet from the Windows operating system to Android. The vehicles will be equipped with the latest generation TS3300 device. Suitable even for the most rigorous use in the most extreme conditions, the TS3300 is fully compliant with the ATEX IECEx directive, allowing safe use in potentially explosive environments.

The TS3300 also utilizes front and rear-facing cameras and a glare proof 7” high-resolution screen, suitable for use with gloves. Slimmer, smarter and stronger than its predecessors, the TouchStar TS3300 is now the most widely adopted mobile device in the fuel delivery sector.

The Carnegie transition to FuelStar for Android will commence in July 2023."

[rivaldo] 24/4/2023 23:18

Indeed - there's plenty of time before Chelverton has to think about disposing of its TST shares. By the end of this year I suspect TST's share price will be rather higher than it is today, and its prospects are sufficiently good that buyers in size for such a usually illiquid stock should be easily found.

[varies] 24/4/2023 17:44

Rivaldo
I should have read the Chelverton report that you mentioned before writing my post a few minutes ago.
I see now that Chelverton intends to put proposals to its shareholders later this year for an orderly distribution of its assets. I suppose that the CEPS shares will be distributed in specie unless a buyer for them comes forwards and that everything else will be sold including the shares in TST.

[varies] 24/4/2023 17:34

rivaldo
I posted some comments on 5 Feb on Chelverton and its holdings in CEPS and TST.
At that time Chelverton held 64% of its assets in CEPS and 23% in TST. I do not think that the CEPS share price has moved much and so the proportion held in TST shares will have increased.
In that post I suggested that Chelverton wanted to sell off all its holdings except CEPS when convenient. I cannot remember why I took this view.
It does occur to me that Mr Martin might like to find a buyer for TST before he leaves us next year and Chelverton would then be a willing seller.

[varies] 24/4/2023 17:34

rivaldo
I posted some comments on 5 Feb on Chelverton and its holdings in CEPS and TST.
At that time Chelverton held 64% of its assets in CEPS and 23% in TST. I do not think that the CEPS share price has moved much and so the proportion held in TST shares will have increased.
In that post I suggested that Chelverton wanted to sell off all its holdings except CEPS when convenient. I cannot remember why I took this view.
It does occur to me that Mr Martin might like to find a buyer for TST before he leaves us next year and Chelverton would then be a willing seller.

[rivaldo] 24/4/2023 12:41

Amusing to see a downtick there. Perhaps someone doesn't like Chelverton :o))

[rivaldo] 24/4/2023 09:36

Chelverton Growth Trust have a £680k investment in TST as their second biggest holding, and in their interims today they state:

"Touchstar, the second largest investment, has made excellent progress in the past six months with a very positive trading statement at the end of January. The company now has a very strong balance sheet with some 40% of its market value represented by cash."

[allviewswelcome] 21/4/2023 11:14

Stockopedia has it down as a superstock as well.

[elited10] 21/4/2023 11:09

Did you see the Hot Stock Rockets post RNS follow up? 'At worst a strong hold'.

[rivaldo] 21/4/2023 10:39

Good to see more new 5-year highs here.

I'm happy to retain my entire holding as there's still substantial upside imo.

[pavey ark] 19/4/2023 10:29

I am a long term holder but did stock up further during the period of very silly pricing in 2020.

I have reduced recently at c. 75p, 85p and yesterday with couple of sales c. 94p

With the price rise I felt that a more appropriate level of holding was required but now happy to hold on to my remaining (reasonable ?)holding.

A very well run company that has never given me the slightest concern and I can certainly see it progressing from here.

Perhaps I will look again at 130p and 150p would probably see me reducing further.

NB: if all my investments went as smoothly this would be coming from my private island....it isn't !!!

[rivaldo] 19/4/2023 08:21

New 5-year highs now - and good to see the full 100p offer being paid this morning by buyers.

I agree about WH Ireland's 120p target being too conservative, especially given the 41p per share of cash - at this point, and with the confident outlook, I'd say 140p-150p is more appropriate.

[cockerhoop] 18/4/2023 19:19

No, I think they're looking at product feature extensions rather than a standalone business. ie External software that could extend the scope of their product.

[russman] 18/4/2023 17:02

order book up; margins stable.
What is TST going to do with its cash.
Bolt on.

[rivaldo] 18/4/2023 09:22

Extracts from WH Ireland's update today FYI:

"Full year results in line; positive outlook for FY 2023E

Touchstar is a supplier of mobile data computing solutions and managed services to a variety of industrial sectors. This morning, the group has released results for the 12-months to 31 December 2022, in line with the trading update provided in January and illustrating strong growth in recurring revenue, profitability and cash generation.

Since the beginning of the year, trading is reported to have been strong, with an opening order book of £1.7m, opportunities being presented in new territories and with the potential to undertake bolt-on acquisitions to enhance the existing product base and footprint. On the back of the results, we leave our forecasts unchanged and introduce FY 2025E estimates for the first time.

The shares trade on an FY 2023E PER of 12.0x falling to 9.5x in FY 2024E and are backed by a strong net cash position equivalent to 41p per share. With 40% of revenue now being recurring in nature and good growth opportunities ahead, we believe there is the potential for the shares to re-rate as the strategy continues to be successfully executed. We see fair value for the shares at 120p."

"WHI view: Good progress has been made in the year against the group’s key strategic objectives and we view the momentum being demonstrated as being highly
encouraging. On the back of today’s results, including the positive start to the new financial year, we leave our forecasts unchanged and introduce FY 2025E estimates for the first time.

It is worth noting that net cash per share is now equivalent to over 50% of the current share price (and forecast to increase). With rising levels of recurring
revenue, and the potential to invest the free cash in growing the business further, as well as the potential for the introduction of a dividend and share buyback programme, we believe valuation multiples have significant scope to expand."

[varies] 18/4/2023 08:57

The results are indeed excellent but the tax credit arising from R&D expenditure accounts for a large part of declared EPS. In these circumstances I feel that the shares should be rated on the pre-tax EPS of about 4.2p giving an historic multiple of over 20.
On the other hand much of this R&D is deducted in the Profit & Loss account.
With so much cash in hand and the prospect of growth in the next 2 years and a return to dividends this year, the shares still look cheap.
I am sorry that Mr. Martin intends to retire from TST next year. He has certainly done an excellent job.

[rivaldo] 18/4/2023 08:39

WH Ireland have retained their 120p target for the time being, but "believe valuation multiples have significant scope to expand".

They forecast PBT to rise sharply to £0.7m this year, resulting in a slightly higher 6.7p EPS (presumably due to higher tax rates), though of course they did undercook last year's forecast.

Similarly, the cash pile is forecast to rise slightly to £3.6m. Again this seems very conservative.

The EPS is then forecast to rise to 8.4p and 9.7p in the next two years.

With 41p per share and rising in cash, it's easy to see a share price of anywhere from 150p up to 250p over the next year once the market starts looking forwards.

[smithie6] 18/4/2023 08:36

..ooh...share buyback programme

[johnwise] 18/4/2023 08:10

Bought in to this 23/1/23 On Good Update, will hold

18/04/2023 7:00am

RNS Number : 4947W

Touchstar PLC Final Results

[cockerhoop] 18/4/2023 07:42

Seems like my basic maths (6.3p prediction) is better than WHI's 5.8p :-)

Ian is a class act and will be missed. He's though never been keen on acquisitive growth so perhaps looking to hand over to someone with a different skillset for the next phase.

[rivaldo] 18/4/2023 07:28

Excellent results as expected, with 6.6p EPS achieved and the £3.5m cash pile representing 50% of the m/cap.

Recurring income is up again to 40%, and cash generation is terrific with £1.8m cash generated from operations in the last year.

Crucially the outlook is excellent, with the order book up massively to £1.7m and the outlook described as "very positive".

There's also the promise this year of (1) a dividend and share buybacks, (2) bolt-on acquisitions and (3) international expansion.

Ian intends to step down in 2024 having done a fantastc job, but that likely gives him another year in charge, and I have no doubt he'll find a like-minded successor.

TST is now a growth company with sizeable recurring income and huge liquid asset backing per share. It deserves to be priced at minimum 120p imo and possibly up to 150p.

[hastings] 18/4/2023 07:27

Very good results and momentum continues. Feeling a bit of a wally for not adding at the full ask yesterday!

[bio_tango] 18/4/2023 07:27

Excellent set of numbers.

[metis20] 18/4/2023 07:24

Today's FY RNS

"After tax profit growth of 63.6% to £558,000 (2021: £341,000)

Net cash of £3,476,000 at year end 2022 (2021: £2,380,000)

Opportunities are being identified to enhance our products and enter new markets by potential bolt-on acquisitions.

Once capital reduction process is approved by the courts, which we expect to take place during the course of 2023, it is the Board's current intention to increase shareholder value by using excess cash by way of the introduction of a dividend and via a share buyback programme."