Transense Technologies Share Discussion Threads

[mattjos] 10/2/2024 00:28

I've followed the company for many years, since 2009. I've actually managed to profitably trade it on a short term basis over 13 of those years. Maybe just a fluke but the charts have helped.
Sept 2022 i stared buying for the long-term and not sold a single share since. My holding is in profit.
I guess i am not lumbered with an astronomically high average holding price as some others may be & neither am i 'wedded' to the errors of prior management but, I do really get the technology and understand the real-world benefits of SAW.
My biggest recent criticism of the company has a total lack of route to market for Translogik product range but, I see they are now finally, finally getting on top of that and doing so at a time when the winds of legislation are firmly at their backs .. right now is the time to massively push that product to a ready market & push it down to smaller size business users.
The business is exceptionally well set and new management really seem to grasp that NOW is their time.

[centipede] 10/2/2024 00:08

Good argument.
However, there are probably many ways of developing a market.

If SAW is so great (and I really do believe it is), then why has it proved so amazing difficult to get takeup, with so many startups, followed eventually by the customer dropping out.

Well, one reason must be that what is currently being used is 'good enough'. Transmission systems run, power steerings work, and helicopters are able to pitch their rotors. etc.

It is interesting that when Transense decided to do the 'manage mining truck tyres' thing, they did NOT choose to use SAW sensors to measure tyre pressures (which was the SAW original sales goal). I spoke with the MD about this at the time, and he said that they simply did not need them.

However, one approach might be to 'prime the pump' as it were. Give people free experiences of what it can do for them. It's already been done with a lot of engineering input to firms. There was once talk of giving away kits to students (never done, presumably due to lack of money). I cannot believe that there are not a huge number of possibilities if the money was available.

Anyway, I gather you would like me to simply go away. One long term danger with many investment sites is that the posts become self-reinforcing. Real harm can be done when people get too carried away by things (ah, but it is all different here now, I hear you say).

I am happy to stop posting, though I will keep my shares. They are now worth relatively little, and the journey of this firm and the investment process is fascinating and has been instructive to me. In 10 yrs time you should look back yourself ... Bye

[mattjos] 09/2/2024 23:24

The company cannot ram the technology down the gullet of the market. There is a natural rate at which the free-market will adopt the technology, according to the commercial benefits that adopters gain from adoption.
If the rate of adoption for SAW is slower than the rate at which the company is amassing cash from the deals already in place then it is perfectly logical to utilise some of the free-cash for the purposes of buying back the equity in the belief that it will prove, longer-term, a profitable decision to do so.
The company has said it is only using cash that is surplus to its immediate operational requirements & I do not doubt that if operational requirements require more cash, they will reduce the buybacks accordingly.

Clearly the current dynamic continues to frustrate certain shareholders ... if you are one of them then, please, sell your shares to the company and move on.

[centipede] 09/2/2024 23:16

Mattjos Post 14477

Well, nobody is going to say that of course, but that is the outcome, and is a very common strategy by a number of companies.

Rather, they say things like:
‘These shares will be held in treasury for the time being to satisfy share option awards in the future.’

However, the actual effect is to:

Increase the share price, and so to hasten the likelihood of the key threshold of options being achieved.

Looking at this overall, the cash held by the company has gone, and those taking up and selling options have taken money out

Once again, I would argue that the company should use any excess funds to develop the company, and that we would all benefit from this.

'critics charge that share repurchases crowd out investment and thus sacrifice innovation and long-term economic growth.'
hxxps://sloanreview.mit.edu/article/the-case-against-restricting-stock-buybacks/#:~:text=Critics%20of%20buybacks%20typically%20make,earnings%20per%20share%20(EPS).

[mattjos] 09/2/2024 21:33

They are not trying to drive up the share price. That is not the brief given to the broker.

[centipede] 09/2/2024 20:58

Hi gnnmartin

re post 14475

I’m simply saying that if/when options are activated, the owner of the option can then pay 10p for the option, which would then be worth minimum 150p.

At that point therefore, one can sell and make 140p a share.
What options are worth currently is anybody’s guess.

The key point is however

This a developing company which is choosing to spend free money on buying up shares, apparently to drive up the share price to trigger options.

To my mind, at this stage of development, any free money should be spent on developing the business.

If this works and the company does well, then options will follow naturally.

[gnnmartin] 09/2/2024 17:48

Thanks Max, encouraging.

Centipede re post 14467, your calculation is way out. You reckon an option is worth more than a share, but it is worth less. Toe see this, choose between being given a share now, and given an option now. In the best of worlds, the option ends up being worth 10p less that the share. Add to that, the share can be sold at any time, but the option cannot be sold until the share reaches the trigger price.

I would say that the option is worth about half a share at the most. The option to share value depends on the company risk. If you think the company will either do amazingly well or go bust, then the option/share value is large (but never as high as one). If you think the company will soldier on at worst, and do quite nicely at best, then the option/share value is small (much less than one).

[scrapiron123] 09/2/2024 17:47

Great interview, worth a listen, thank you mavix

[mavix1992] 09/2/2024 15:45

Transense has published an interview with Ryan Maughan and Richard Clarke the Engineering Manager of high-performance products at McLaren Applied:



McLaren initially used the SAW technology from Transense in a balanced performance environment for the Indycar series. The series used the data from the SAW sensor to control the teams, so the teams within series did not get the data. The teams were astonished how it could be that the sensor must not be calibrated throughout the season in contrast to the torque sensor that they use for their cars. McLaren Applied is now also working with the teams within the series to implement the SAW technology, not in a balanced performance environment, but from a performance measurement or improvement perspective that allows the teams to get live data from the shaft. Weird data traced can be a signal indicator for the injection cycles in the engine that could allow the engineers to observe inbalances and potential failures within the engine.

The SAW technology is a big part of McLaren Applied’s strategy. They are pushing it hard into different series and teams. They are straining to keep up with the volume of inquiries they are now receiving as the technology could also be installed at other areas within the car. SAW has the potential to be a substantial proportion of McLaren’s portfolio within high-performance components over the next 5 to 10 years according to Richard Clarke, the Engineer Manager of high-performance products at McLaren Applied.

[mattjos] 06/2/2024 23:27

Yup, there are management options in place but, that has not stopped management repeatedly buying more shares on the open market. Salaries here are not exceptional.
There is clearly an above-average level of management commitment to the company future

[scrapiron123] 06/2/2024 23:13

If you have the right team and incentives in place it should be both, good for management and the business. Attracting good people is hard, especially in Science/Engineering with good skills and experience, this is a business with a history that probably makes it a bit harder too. Without the right people, the business will not be a success.

[centipede] 06/2/2024 22:37

You are absolutely right that I invested in the wrong business (/kind of business).
I was very naïve and seduced by the 'story'. All of the evidence indicates that such companies have a very high failure rate. I am hanging on with the limited value left as there are some signs of life, and I have an emotional connection (sad, I know, but I can't help it). BTW, my other investments (now value-based, do ok, unlike the average independent investor who loses the majority of the gains of the stock market - 2% gains versus 8% hxxps://www.crews.bank/blog/sp-500-vs-average-investor. )

I agree entirely that we will never agree. You probably believe it is blindingly evident that there are significant differences in the abilities of people to manage companies, and that the key way to motivate them is to give them more money.
It may be interesting to look at 'Pay without Performance, by Bebchuck and Fried', and 'Myths and realities of Executive Pay, by Kay and Putten'
or even for a quick (fun?) review, have a look at

I shall shut up now, but it really annoys me when management does something that is evidently for their own benefit, and try to dress it up as some form of positive business move. They have probably got themselves convinced.

[scrapiron123] 06/2/2024 19:34

I think we are going to have to agree to disagree here. It's clearly not an easy task, circling back to my earlier comment, otherwise it would have been done by now, Not to mention dealing with the significant legacy. Just paying a salary is very much not the norm and isn't going to get the right sort of people to scale up a business like this, you want the team to be aligned with business success. If that's what you are looking for you are invested in the wrong kind of business.

[shifter2] 06/2/2024 19:06

Maybe good they are buying be 70/80p without support?

Few chunky trades last few months won’t be many old timers left soon

[centipede] 06/2/2024 17:48

It's gotta be IRO 14% plus of the market cap (10p for a share which would then be worth 150)
MC is now £15 million - so actually quite a chunk of money (2 million or so ...) for doing what they are already paid for.
Now, these are our shares, and our interest in this company.
Where is the money best used ?

[scrapiron123] 06/2/2024 14:30

Given the history here a degree of prudence is highly appealing. The business has not been treading water these last couple of years, far from it.

[scrapiron123] 06/2/2024 14:28

But it was not when most of the current leadership team joined the business. In value terms it's quite small divided across the leadership team at present share price

[centipede] 06/2/2024 13:26

Indeed.
The management only has to tread water, and use the profit to buy up shares, until the price reaches the options level, when they can then buy that 10% at 10p each.
This seems to be a common ploy and does not motivate in any way.

If anything, it damages companies which are not using available money to develop and grow the business. Which would be my preference.

One can always argue that they are already developing the business, and that there is nowhere to actually spend the money. Seems highly unlikely to me.

[glavey] 06/2/2024 07:23

"The option pool is relatively small"

10%, for a company of this size, is not relatively small IMV. The share price was over 150 (equiv.) pre consolidation.

[scrapiron123] 05/2/2024 18:34

Reading the last couple of results presentations and watching the IMC's you can see they have engaged now with a lot of companies, this has grown exponentially in the last 12-18 months, the "new" team has deep expertise in focus markets and developing tech products. The structured approach comes across very well. Also a clear repositioning of Translogik which seemed to have been almost forgotten about. You have to imagine that for them to even be there, they must believe that the share price is worth more than 200???

[centipede] 05/2/2024 16:23

Selling/commercialising is key to a business. The theory goes that you increasingly invest in selling up to the point where it costs more to sell than you get from any increased sales. Have they really reached this point yet ?

There is also the idea that you don't simply go off and develop what you consider to be a better mousetrap/torque sensor and then expect people to beat a path to your door.

Instead, you first check it out with actual rodent control people/engineers. The aim being to work with them (fail early, fail fast) to develop things to the point where they will tear the product out of your hands.

Doing this costs money of course - but they apparently have money to spare.

It is noticeable that the big success for this company (sensors in mine vehicles) was developed by someone who was initially an outsider, but who had a really good understanding of the tyre business, and was able to closely match in with the needs of that business. Also, this product doesn't have anything at all to do with SAW ...

I was indeed one of those fools who bought at a massively higher price. Based on strong expectations of near high uptake in various applications. None really coming to much (also remember the American police car, for instance ?)

[scrapiron123] 05/2/2024 11:21

The team and business has been changed beyond all recognition. The option pool is relatively small and they are worth nothing until share price hits at least 150, where it has not been for many, many years. Before most of the current senior team had probably ever even heard of the business. No idea how the past share price was ever justified or why people bought in at that, but I guess there were good reasons, what you can say is if commercialising it was easy it would have been done by now!

[centipede] 05/2/2024 10:42

All smoke and mirrors.
They are using money that is 'ours' to buy back shares, to offset giving themselves options.

Share buy backs are endemic, and (by reducing the number of shares) are typically used to increase the earnings per share (which is often linked to executive pay/bonuses)

If there is spare money, why not spend it on a push to actually commercialise SAW ?

There have been so many missed opportunities - remember the clutch plate, power steering, etc.

[glavey] 05/2/2024 04:25

IMO, points to a rather excessive gifting of options given the very many years of abysmal (under)performance. The probability is that the average long term holder would likely not even reach break-even with a £2 s/p. without even contemplating the effect of inflation.

[mattjos] 04/2/2024 17:11

Management seem very focussed on commercialising the IP & therefore responding to market demand so, I don't conclude that is likely.
They also (quite rightly imo) believe the equity is undervalued at current values.
Achieving the Option Hurdle levels of firstly £1.50 & then £2, targets I am quite sure they ae all acutely aware of & motivated to achieve, represent 50% and then 100% above current valuation ... a notional return far beyond simply holding the cash in Money Market account.
Management and shareholders interests are well aligned in the near-term objectives.