Venture Life Share Discussion Threads

[haywards26] 20/9/2016 20:50

Topped up my CLLN holding again today...

[hydrus] 20/9/2016 20:46

Thanks I hadn't seen that - it's been in my watch list for a long time but such is life

[hydrus] 20/9/2016 20:44

Interested why you think 'Ratios like ROE mean jam tomorrow'For me ROCE is a key indicator of management's ability to achieve a return of their allocation of capital, which is in essence management's only key role.

[apad] 20/9/2016 20:44

Paul Scott (you've probably seen it, H:
"ECO Animal Health (LON:EAH)
Share price: 305p (up 1.8% today)
No. shares: 63.2m
Market cap: £192.8m

Results y/e 31 Mar 2015 - the headline bullet points look really good - all key metrics up significantly, e.g. sales up 22%, pre-tax profit up 38% to £5.1m.

Diluted EPS is the best measure of performance here in my view, and that rose from 4.3p last year to 6.79p this year, an increase of nearly 58%. Although note the rating is very high, at a PER of 44.9. However, if that rate of growth continues, then the company would grow into the valuation quickly, so I don't rule out high PER stocks where they are on a strong & sustainable growth path.

We should of course be looking at what the PER would be for this year & next year. Broker consensus is for 12.3p EPS this year, so that's a PER of 24.8, which is high, but doesn't seem outrageous for a fairly high margin growth company.

I flagged up this stock as potentially interesting in my report of 28 Jul 2014, but didn't get round to doing any more detailed research, which is a pity as the shares have risen 76% since then. Hopefully some readers picked up on the idea, that's the purpose of these reports after all, to hopefully give some pointers for stocks that might be worth looking into in more detail.

From what I can tell, growth seems to be organic too, since the Goodwill line on the balance sheet has not changed in the last two years. As I mentioned on 28 Jul 2014, investors need to be aware that a large element of costs are capitalised into intangibles here. So the focus on EBITDA in the narrative should be ignored, in my view - since it over-states performance by ignoring capitalised costs and the amortisation of historic costs.

Almost £5.3m of development costs were capitalised into development costs on the balance sheet in the year. That's fine, as a drug company will have substantial development costs, but it's important to bear in mind when valuing the company.

Balance sheet - overall this remains very strong, and has £17.7m net cash.

Outlook - upbeat, "The new financial year has started well with revenue maintaining momentum. I look forward with confidence to ECO delivering another impressive performance..."

My opinion - overall, although the shares look expensive, this looks a credible growth company, which is decently profitable, and growing well."

[hydrus] 20/9/2016 20:34

BTW I'm buying after a spike so smarter folks good at timing their share purchases might think I'm nuts but I'm just no good at timing. Therefore I just buy when I feel confident and comfortable there is a high likelihood of exceptional growth prospects.

[hydrus] 20/9/2016 20:31

Your call - I've had a closer look and I'm reasonably confident they have something special

[apad] 20/9/2016 20:22

I'm easily scared, H.
I've only had a quick look and I write companies off very easily.
£300 million company over a lot of countries that I wouldn't necessarily associate with ECO anything, but I do associate with antibiotics. 2/3% in UK. Ratios like ROE mean jam tomorrow. Don't understand the chemistry/biology.
Don't listen to me H, I haven't studied it, just done a quick flick.
apad

[hydrus] 20/9/2016 20:11

Happy to get your opinion APAD but I need a little more than 'scary' :) In any case it has a score of 4 out of 100 on stockopedias 'scary' rank so it must be fine

[apad] 20/9/2016 20:07

Scary, H.
apad

[hydrus] 20/9/2016 19:29

I've opened a position in EAH. Anyone else invested? Looks like it's on the verge of multiple years of exceptional earnings growth to me if I've understood their new Aivlosin drug correctly, high operator ownership, non cyclical, low number shares in issue, increasing ROCE, no debt. Anyway, I've gone from butchering pigs (CRAW) to keeping them alive (EAH). I'm all heart.

[apad] 20/9/2016 18:41

Hi Pete,
I like the look of the company and its management.
3 people own 76% so I could get locked in and yes the spread is off putting. I paid 76p and don't have a lot - I think it's growing on me.

apad

[petersinthemarket] 20/9/2016 09:35

Based on this mornings announcement MOGP is improving slightly in some areas but anything more exciting than that is going to take a long time - far too long for me. I'm out at a small loss.

Interesting to see you adding to PTSG apad. Still suffers a rather heavy spread. You must be confident. Or are you playing roulette again!

pete

[apad] 20/9/2016 08:49

Increased PTSG ahead of interims next week.
apad

[apad] 20/9/2016 08:02

JDG profit warning. Another example of how people could have made big gains from a rubbish company in its early days.

GSK appointing an insider. Good decision, but the market would've liked an outsider who would wreck the company for short term gains.

apad

[redartbmud] 20/9/2016 07:35

Sound Energy, the European and African focused upstream company, is pleased to confirm the commencement of civil works at the Badile exploration well site, onshore Northern Italy. The rig is expected to be mobilised during Q4 2016 with a view to drilling commencing around the end of the year.

Investors are invited to observe operations on site through the Company's webcam, which is expected to go-live later this week.

James Parsons, Chief Executive Officer, commented:

"Following our recent success in Morocco, I am pleased to initiate the countdown to our second Strategic Play. Badile is a material gas prospect and one of our largest and most strategic assets. I look forward to this opportunity to repeat our success at Tendrara."

red

[larva] 19/9/2016 21:15

MItie Profit warning not good news for PTSG
Am expecting PTSG to crater

[apad] 19/9/2016 19:19

Bought Terry Smith's Accounting for Growth from Abebooks. Lot cheaper than Amazon.
apad

[melton john] 19/9/2016 17:16

On the subject of doughnuts and calories. How much does this cost the health service once the Fire Service have done their bit.

'Bariatric' rescues - which involve coming to the aid of severely obese people, who are often stuck in their homes - have increased from 709 in 2012-13 to 944 in 2015-16, figures collected from all 50 UK fire and rescue services show.

[apad] 19/9/2016 09:51

I don't think I could eat a whole one, H:-)

Didn't know that Subway is quoted, perhaps it isn't. Niche is nifty and bounded, I like niche.

I think my prejudice about shops has been confirmed by this interchange, but now with the exception of being early with something catchy reinforced, e.g. the likes of CAKE. A friend bought CAKE in the early days because he passed one of their shops everyday.
In the meantime, BOO is my big exposure.

Krispy Kreme is an established brand and being sold in the UK by money-men. I shall avoid, but there will be lots of publicity so there may be early gains for traders.

Should be able to increase BVXP a little on friday.

WEIR bounced back smartly from the dip.

apad

[hydrus] 18/9/2016 19:57

Forgive me for moving away slightly from store roll outs but I was thinking of subway which is a combo of both franchise and store roll out.

[hydrus] 18/9/2016 19:55

They should use that as a selling point - if you can get your daily calorie needs from just two doughnuts then they are great value. I always keep my eye out now for any early stage franchises but can't see anything exciting. Franchise brands (FRAN) could turn into something I suppose if they acquire an exciting franchise but it's currently not growing very fast and I can't see people continuing to pay for residential oven cleaning in a downturn!

[apad] 18/9/2016 19:36

ps
Krispy Kreme doughnuts to float :-)
I think I read somewhere that one or two is a day's worth of calories.

[apad] 18/9/2016 19:26

My impression is that the supermarkets are competing heavily on price, but at the same time improving the quality. I'm happier with brands that differentiate (pheasants, posh beef, artisanal pies - back to Brackley) rather than mix it on price in the Aldi vs the rest battle. Especially when it involves a separate shopping trip.

Agree with H about the timing, well done - essential on any new stores roll out. CAKE, pizza restaurants:-) woteva. They all seem to do well to start with, then roll over, or become Pizza Express.

apad

[hydrus] 18/9/2016 18:51

BTW congratulations on your returns in CRAW, demonstrates the benefits of spotting microcap growth stories early.