Tricorn Share Discussion Threads

[apad] 14/9/2012 09:43

Increased holding @ 31p.
Couldn't decide on the balance of risk and reward between "softening" being in the price and almost certainly being present in the statement on the 3rd but possibly being balanced by other news.
Tossed a coin!
apad

[rivaldo] 05/9/2012 13:43

Interesting stuff from the Times today in an article about the growth in the Chinese middle classes - lots of new aircraft to be built in the coming years:



"Of the present global fleet of 15,550 passenger jetliners, Airbus reckons that about 5,200 will still be going in 2031. In addition to the 10,350 that will be commissioned to replace retiring aircraft, a further 17,000 will be made - most of them Airbus A320s and Boeing 737s, the workhorses of short-haul travel networks.

Add in about 850 new freight-only carriers and that means 28,200 big new aircraft to be built, mostly by Airbus and Boeing, in the next 20 years - at a cost of $4 trillion."

[shauney2] 04/9/2012 17:17

Plenty of weakness today.
Disappointing but not surprised after seeing the word softening.

Seen the same word used in the past with reference to the aerospace division.Ironic that is doing well and the normally reliable transport division is not.

The transport division has been the driver in the past(excuse the pun)

Really needed some more meat on the bones of that statement.These will faff around now until the update in a month.



Westhouse have reaffirmed their buy and target of 50p as you would expect.

[apad] 04/9/2012 13:21

Also looking to increase holding on weakness.
Expecting weakness as it's a tiddler that will be on nobody's radar for a while.
apad

[rivaldo] 04/9/2012 12:01

Interesting that the terminology is EXACTLY the same as per last year's AGM statement, word for word:

""The Group has made an encouraging start to the current year"

Last year turned out extremely well indeed.

There's a little more colour this year in terms of softening in transportation, but surely overall the conclusion has to be that "encouraging" is the key term, with a little caution on the side.

[electronica] 04/9/2012 11:47

Pretty much a "steady as she goes" statement from the Chairman at the AGM.

Consolidates TCN as a good. nicely undervalued medium term play - but may not go down well with the market in the short term.

TCN is still & hold & accumulate on weakness for me.

[interceptor2] 25/8/2012 12:37

Interesting point in the charts imv. Cup and handle have been forming since July 2011 , about 60 weeks. C%H normally take between 7 to 65 weeks for whole pattern.

Handle has in the main been at or above the 50ma, and is slightly decending with a 37p high in the handle which is the break out target.

If the next AGM statement 4th September or more likely the trading update in early October,could provide the catalyst to break out imo.

ic2...

[rivaldo] 16/8/2012 16:04

Bit of a sudden move up?

[rivaldo] 08/8/2012 11:20

Daniel Stewart this morning released a note on the positive read-across for Porvair (PRV) from Meggitt's results this week. This is also of course relevant for TCN as per shauney2's post above. I hold PRV (which is fully listed) as well as TCN:

[rivaldo] 07/8/2012 10:29

Good spots shauney2. Looks like a mere 5k buy was good enough to prompt a 1p rise!

[shauney2] 07/8/2012 08:40

Agree ic2.You can sell plenty at the moment and only 1k available.

A good read across for the aerospace division from MGGT results this morning.

[interceptor2] 06/8/2012 15:35

Back over the 50ma on strong buy transactions today, chart ready to attempt 37p break out?

ic2...

[apad] 02/8/2012 19:08

"I am hoping that the increase in capex/chinese factory will be a worthwhile investment"
That's the heart of it cfro.
The cost, as last stated, was forecast to be remarkably small, and they have good experience int he region.
apad

[cfro] 02/8/2012 18:40

I am hoping that the increase in capex/chinese factory will be a worthwhile investment APAD. I do agree tho with the world economy in such a precarious state, trading here does need to be watched carefully.

RBN, i am kicking myself for not buying that one APAD!

[apad] 02/8/2012 16:25

More CAPEX, bigger price to free cash flow ratio, cfro.
My biggest difference is Bioquell.
Price to free cash flow is about 10 times PER!
Agree that TCN's figures are not concerning - just trying to make a balanced judgement about value.
In amongst the small engineers RBN is/was outstanding value (cf TCN,s good value(on my scales)).
Basic ratios make interesting comparisons (although RBN is the most illiquid share I have ever held, so buying it aint easy!)
Re. the Avingtrans comparison - in my view it is a much more diversified company. Don't like the mix and style of the group, because I cannot see a real vector to the company's strategy.
We have another comment about the issue of becoming an accredited supplier, from Cisk. This is very, basic stuff that applies to all companies and always has.
My initial concern was not about a start-up pipes company doing a Yosser Hughes. It was about an existing, larger company (one with credentials) competing with our £10m cap. 300 employee, 7% operating margin company. Enough already
apad

[interceptor2] 02/8/2012 15:42

cfro, Your last sentence, I almost added the same thoughts to my post, indeed this year they are in a better position to buy back some shares if they think the share price is undervalued. And seeing they sold the last of their treasury shares last year, why not build the reserve up again.

ic2...

[cfro] 02/8/2012 15:38

Yes capex is increasing as they biud the new Chinese factory but net cash is also increasing strongly now.

Last year they couldnt make share buy-backs due to the debt but this year is a different kettle of fish, ie they can now afford to make them.

[interceptor2] 02/8/2012 15:33

Hands up, Just read back to last years AGM, and they already had agreement to purchase upto 10% of issued share capital. So nothing new this year.

APAD, Just also had a look at free cashflow in the 4 years before most recent results, and the historic figures look pretty good to me, with cfs/eps almost 2x and free c/f about 1.6x average. I admit the most resent full years figures are not as strong, but TCN are increasing capex going forward.

ic2...

[cisk] 02/8/2012 13:20

All,

Companies routinely table a motion at AGMs seeking authority to buy back shares - so I don't think its inclusion here signals anything other than having the ability to do so in the future.

We had a little write up in Shares Magazine today, Tricorn picked as one of their '10 Sizzling Small Caps'. They're forecasting 11.8% eps growth next year and 28% the following year, making forward p/e 6.3.

Seems ridiculously cheap if true.

As for earlier comments about competition - the pipe assemblies aren't something that you can easy pick up and reproduce - the design period takes a long time and goes through many iterations before the final product is produced. It's not like a simple hose connecting two parts in a car engine, for example. The assemblies have to go through rigorous testing over a wide range of situations, and customers, esp. RR, will place strenuous weight and performance targets.

A friend of mine has a business making precision valves for oil rigs, ships etc, high value items that take a significant period to design and then manufacture. I kind of think the assemblies from Tricorn are very similar.

Also to actually become a customer is a long and expensive process. Once you supply one product, it's far easier increasing that number than to actually get in in the first place.

I feel that Tricorn are in the right market now - and are very similar to another one of my holdings, Avingtrans.

They operate in similar markets and share some of the same large, blue-chip customers. Perhaps they would make a good combination together?

[electronica] 02/8/2012 10:16

PJ1

Ther will be no takeover without the agreement of Roger Alsop & Hargreaves Hale. These 2 own 56% of the equity between them. This morning's RNS strongly indicates that Alsop will not be a seller - so a takeover is not on the medium term agenda.

[pj 1] 02/8/2012 09:37

Ok Thanks..

[alter ego] 02/8/2012 09:12

PJ1 no, I think it's just that anyone who has more than a given percentage of shares is obliged to make an offer to buy the rest. In this case reducing the number of shares in issue might create that situation so they are asking for the rule to be waived by other shareholders.

[pj 1] 02/8/2012 09:10

So daft question....BOD is concerned about an offer coming in?

[apad] 02/8/2012 09:07

ic2
Not sure about your view.
Price to free cash flow is high cf PER.
Yield does not support the price and the current fashion for buybacks is not a substitute for dividend payments. Benefits management over shareholders.
The unfolding story is the shift to production in China and the company depends on worldwide economic health.
Reasonably good value, but not outstanding, is my view.
Good judgement at 21p, ic2.
apad

[cfro] 02/8/2012 08:48

So, going to do share buybacks are they?......very good news then imo.