Triad Share Discussion Threads

[melton john] 28/5/2020 10:44

At last, a grown-up in the room CJohn, not convinced we are at bargain price yet though although not near-bankrupt

[cjohn] 28/5/2020 10:44

Hi Melton, the half-year report says this, "Cash as 30 September 2019 is £2.96m (at 31 March 2019: £4.60m). The decrease during the period is due, approximately, to the operating loss for the period of £0.3m, the dividend paid during the period of £0.3m and the impact of overdue debts of £1.0m as at the period end, all of which have now been cleared."

So the implied level of net cash is £4m, post half-year end.

[melton john] 28/5/2020 10:39

You are dreaming I think to suggest a change from a 300k pre-tax loss to a 800k profit. Still fantasising about £5M cash when your chairman says in his interim statement: "Cash as at 30 September 2019: £2.96m". Maybe if you stopped whatever you are smoking reality would dawn on you.

[cjohn] 28/5/2020 10:35

Hi Melton John and Net Curtains,

I'd expect a loss at full year.

But the balance sheet is very strong. Implied £4m net cash, post half-year end, plus a few hundred thousand of other net current assets compared to a market cap of about £5m.

This really leaves a decent margin of safety, assuming trading has been further worsened by COVID.

I personally don't mind that trading has been poor recently. If it hadn't been, the share price would not have reached the present bargain level. If you look back over TRD's history, trading is choppy. If there is a reversion to improved trading, the share price will appreciate significantly. If trading remains poor, the balance sheet provides considerable underpinning to the share price.

If I look down my current list of holdings - half in UK, twenty percent Japan, 10% US, 20% other - 80% of the companies were loss-making when I bought in. There is a wealth of research data that shows that buying shares in loss-making companies that are trading at bargain levels - ie at a discount to tangible asset value - is a strategy that very significantly out-performs the market. It's certainly been my personal experience over many years too.

To me, TRD fits into this category.

PS Melton, thanks for reminding us to always use latest results.

[netcurtains] 28/5/2020 10:12

the previous Finals came out on 10th June and in 2018 on the 11th June (both first Monday of second full week of June) - so if that is the case, it will be 15th June this time (but outside chance the 8th).

2019 results had:

· Profit before tax: £1.02m

From banner at top of their website (nearest thing to a Covid Update):

Despite the current challenges Triad continues to offer our full range of services to clients.
Being digital by default, our teams are operating as normal albeit working in a highly distributed manner. Our development teams are building great software, our consulting teams are running virtual workshops, and our resourcing teams are fully geared up to support online interviewing and selection processes.

It reads to me that results will be a bit down due to this phrase: "Despite the current challenges..." but more or less inline with expectations... Nothing dramatic as surely they would have issued a trading update?

This being the case I would expect pre-tax profit of about £800k (or there abouts), final dividend 2p, interim dividend 1p (3p in total for year or about 8% yield),
With net cash of about £4.6 (£5m) and a market cap of about £5m then one really must assume this has been well oversold. I would have thought a share price of about 60p to 80p would be more fair which still equates to a heafty yield of about 4% and pre-tax profit of £800k - anyway that is how it seems to me.

[netcurtains] 28/5/2020 09:08

Hi weatherman (I said that to Melton John THREE times (now you've added a forth)) - sometimes you can take a dog to water but you cant force him to drink. Let him be.
I'm sure he means well.

results in a few weeks. No TRADING UPDATE due to COVID so assume its not going to have that big an effect (IT people can easily work from home). I see normal large dividend , large cash pile and a miles over sold stock... (obviously probably bottom line a bit less, Covid must be having some affect but probably not much).

In effect CASH about £5m (4.6m), Market Cap £5m - Yield (at current price) about 8% a year.

[weatherman] 28/5/2020 08:36

There was a debt at year end of £1m, now cleared. So cash at YE was effectively £4m.
"Cash as 30 September 2019 is £2.96m (at 31 March 2019: £4.60m). The decrease during the period is due, approximately, to the operating loss for the period of £0.3m, the dividend paid during the period of £0.3m and the impact of overdue debts of £1.0m as at the period end, all of which have now been cleared. "

[cjohn] 27/5/2020 16:56

The company is trading at a 10% discount to current assets.

Very very cheap.

[netcurtains] 27/5/2020 16:21

Actually I got that wrong - I think the annual Dividend (with current share price) is about 8.5% not 7.5%......
I think profits/turnover will of course be down but they all seem to be working so I guess not too bad, I think they'll be doing OK.

I mean subtract the cash pile from Market cap and the entire company is valued at more or less nothing!!!!

You get the company thrown in for free.

[netcurtains] 27/5/2020 15:23

Final results in June. I suspect they be OK and you'll get the dividend.. (the one industry where people can all work from home is IT).

[netcurtains] 27/5/2020 10:36

see above ....

[netcurtains] 27/5/2020 10:28

How come TRIAD have about £5M in the bank (make a bit of a profit) but their market capitalisation is just £5M.
Doesn't that mean the market thinks TRIAD is WORTHLESS???????

From Chairman's statement:

For the year ended 31 March 2019 the Group reports
revenue of £22.7m (2018: £27.8m). Profit before tax has
decreased to £1.02m (2018: £1.66m) and gross profit as a
percentage of revenue has increased to 19.3% (2018: 17.0%).
The Group’s year end cash reserves have increased to
£4.6m (2018: £3.8m).

And it also has a thumping massive YIELD of 7.69%

Come on! This has to be the bargain of the century.

[netcurtains] 05/5/2020 08:40

garth: of the nine that were up - those with significant rises were BBSN, CCC, TEK and ALT

BBSN: Brave Bison Group (flat)
CCC: Computacenter (up again)
TEK: Tekcapital (down)
ALT: Altitude Group (flat)

So no pattern alas at present... Unless something in Computacenter rise.

[garth] 05/5/2020 07:50

Morning Net.

It would be nice to see it push up through the 100 day MA today or tomorrow - and then push on towards the 200 day.

G.

[netcurtains] 05/5/2020 07:44

Going through all the companies with "sub sector" of "computer services" yesterday - 9 UP and 2 DOWN. Be interesting to see what happens today.

Triad's FTSE ICB subsector is "computer services"

[netcurtains] 01/5/2020 15:26

Yes CJohn, that is one of my thoughts. I will be looking for other patterns too of course. Another example of a TRIAD type rise and a bit of 'chatter' - but perhaps way more substantial - has been the rise of MOBILE TORNADO - MBT.

[cjohn] 01/5/2020 15:11

So you're thinking that sudden activity on a previously quiet board is indicative of - in general - momentum investors getting interested? And so an uptrend starts. It's a very interesting idea.



In terms of BBs in general. There's a fair amount of academic literature looking at BB favourites ie small concept/tech stocks with huge followings. These have a strong tendency to underperform the market.

And neglected stocks - with scant followings - tend to over-perform.

If I've understood you, you're trying to seek out stocks that are moving from being neglected to being followed. The point where the outing of value produces momentum.

[netcurtains] 01/5/2020 14:35

(you'd be surprised most stocks have no followers here or on Twitter or LSE etc etc. To have a couple of posts PLUS share price rising is something worthwhile flagging (especially if the "chatter" is coming from one of the more famous investors (on twitter) or from previous winners of share competitions. All this can be automated (touchwood - Java, MySql, Selenium mix should do it... None of us are famous but nevertheless Triad would appear in a top 50 list - not sure about top 20 - I will see soon (it will alas take me weeks to complete).

[cjohn] 01/5/2020 13:12

Netcurtains:

"High Yield PLUS BUY price recently rising PLUS internet chatter"


Internet chatter is measured subjectively? Or do you automate that as well?

[netcurtains] 01/5/2020 09:34

One thing is for sure..... With nearly ALL business now happening online, IT contracting must be booming OR IT SOON WILL BE - every business needs good online presence or will go bust... Yes I know its not the ideal time to take on staff - but if they dont have good web sites then they will be dust. In theoretical sense this is the time for IT.

[netcurtains] 01/5/2020 07:40

Being furloughed at present I'm developing an automated system to pick stocks.
One of the criteria I'm thinking of using is:

High Yield PLUS BUY price recently rising PLUS internet chatter ..... I think my software would pick TRIAD as an interesting example of ONE of the reasons to buy - there are of course lots of other ones. I'm hoping my software will give me a list of about 20 stocks (of various types) that are worth looking at.

It would be interesting to see over the next week or so if my "tea leaf" list is a positive signal and this stock rises to a level higher than it is today

(you could argue I am distorting the findings by chattering myself, but NO this is a stock I own so one would expect me to chat about good trends in the price)..

[garth] 30/4/2020 18:10

That's right Net. There are two ways to halve that yield rate. Let's hope it happens the way we would want it to! ?G.