Xlmedia Share Discussion Threads

[mysteronz] 14/3/2018 12:34

I think as soon as the large cash pile is invested we should see big brokers upgrades to the EPS and Rev. The reason why the forecast increase in 2018 is so low is the rise in share count is diluting some of the natural growth in the business

[morph7] 14/3/2018 12:28

Thanks Rivaldo much appreciated.

[gargleblaster] 14/3/2018 12:25

Thanx v. much riv - very good points you make. I wonder in MONY will consider buying them, especially as they are moving into FS/comparison websites?

I agree that the recurring income, which is like an annuity, is their trump card, and unless gamblers quit that income will continue. But given the recurring income, it really begs the question as to why the fwd projections are so low. Why for example are Berenberg projecting minimal eps growth, whilst sticking a 290p price target on the stock?

[hatfullofsky] 14/3/2018 11:57

rivaldo - many thanks for the write up

[pazzuzu] 14/3/2018 11:55

Why is there a stigma on Israely companies? Have they historically been scamps?

[rivaldo] 14/3/2018 11:39

I went to the presentation yesterday and came away extremely impressed and encouraged.

Ory and Inbal Lavi presented. Most of what was said was as per the web cast and in the results. There was certainly a stress on "aggressive" growth targets, and on the potential for both organic and acquisition-driven growth.

Even in the "home" Scandinavian markets XLM still have a relatively small share of their markets, and XLM are confident of growing this.

They didn't want to go overboard on the potential in the USA. However, there are a number of reasons for optimism:

- the potential lifting of restrictions on sports betting in the USA after the upcoming court case
- the recent allowance of online gambling etc in Pennsylvania, which could spur further relaxation in other states. Pennsylvania should begin generating such revenues in H2'18
- money comparison web sites and take-up in the USA are well behind those in the UK and elsewhere. XLM are hopeful from feedback and performance to date that Greedyrates, moneyunder30 etc will grab a large slice of this market

The rewards from some or all of the above could be transformational imho.

Finally, there was an interesting interlude when a question was asked by someone who stated he was (1) one of the founders of Moneysupermarket.com and (2) a large shareholder in XLM. He noted he'd buy a lot more if XLM wasn't so illiquid! Given the consistently large volumes I'm really not sure about that.

Anyway, he stated XLM was a "beautiful" business given the large recurring income arising from the book of referred customers from whom XLM gain a lifetime revenue share from the gambling companies.

He believed that XLM should make more of this. He believed the City wasn't currently aware that XLM had such a significant bedrock of recurring income - and Inbal agreed that in theory they could turn out the lights, shut down everything else and have a highly profitable business sitting and collecting these revenues.

If the market was aware of all this then XLM would trade at a multiple significantly higher than currently.

This is probably true imo. I suppose the hope is that at some point institutional investors will see through the usual negatives, i.e Israeli-based (which in the USA would probably be a positive), gambling-centred (which is steadily reducing) and concentrate on XLM's virtues.

This process has hopefully already begun given the successful January placing at 198p. Why the share price has slid to 181p - almost 10% below the placing price - is beyond my ken apart from there being a specific seller or two who need the cash. Perhaps they need profits to balance out losses in CVR/GNC/all the other companies who've recently warned!

[pazzuzu] 14/3/2018 11:36

I hope so too. I did sell a third day before results but brought back a tonne load at 182.50,perosally expected a bounce already, but still. It will come. Curiously though, do you suppose the lack of forward speculation is the cause for this?

[pshevlin] 14/3/2018 11:29

Nothing but sells this a.m. Hope this isn't going to be in the doldrums for ages.

[nocrap] 14/3/2018 11:24

read this its buffett speech at the 5 day visit to sun valley in 1999, he gave all those that were making money in internet no profits hype stocks get a huge shock.


archive.fortune.com/magazines/fortune/fortune_archive/1999/11/22/269071/index.htm

the longer version is in his best selling book the snowball, i recommend reading it.

[nocrap] 14/3/2018 11:07

i always say the quietest chatrooms are they best, why cos they are owned by investors not speculators.

speculators are what buffett calls voters, investors are those he called the weighing machine.

what he means is a stock can only grow yearly by the size of its economics. the weighing machine,

those that drive a spec stock with no profits stock up too high are speculators using the greater fool theory, where they dont care about the non profit growth of the stock, they buy to sell to next mug.

he says intelligence isnt required to be a voter, but IQ is needed to be a weigher.

and those that can value a stock, have the safety margin as they buy in not based on unloading to next mug, but buy in cos they know they have a bargain.

he said in his speech in 1999,that those that buy spec stocks with no profits will get burnt.


you can go thro life ramping up blue sky stocks and trying to get some mug to buy off you or you can be an investor and know that you dont need to worry about finding mugs, cos the company makes money and rewards longterm holders.

owning a stock is like a bond except a company tekes its earnings and piles it back into company to grow it, when you buy according to buffett, you are deferring an income from said stock as it piles back earnings per share in dividends in years to come.

if it makes no income, then your are just guessing, hyping, speculating, that is what caused the internet bubble.

in short xlmedia is a stock with growing earnings, and undervalued, just buy and own it, i do and i also own taptica.

[pillion] 14/3/2018 10:54

Good find GB

[gargleblaster] 14/3/2018 10:43

All gone quiet here - I think I saw some tumbleweed blow past the window!

IC have re-iterated their stance on xlm. They conclude their buy recommendation with this.

"Momentum may have tempered in recent months but we think there are still expansion opportunities for XLMedia, which an enterprise value to adjusted cash profit ratio of 7.5 times fails to account for. Buy".

[nocrap] 14/3/2018 08:06

290p target, all broker targets are 12 months targets

[scooper72] 13/3/2018 23:45

They love doing things like that. To be fair they can be a bit hit and miss. I discovered volvere through paying about £130 for a report on 4 or 5 small cap companies that they were touting. Luckily I ignored the one that was advocating buying shares in something like Brighton Peer, and went for VLE. But then in their hidden winners subscription they were keen on Safestyle and Luceco. Luckily again on those two I got out relatively quickly and didn't wait for their 'sell' decision....

[pshevlin] 13/3/2018 23:22

So what's the monster stock that can grow by 200%?

[scooper72] 13/3/2018 22:10

Motley Fool Hidden winners was one of the first places I heard about KWS about 18 months ago so they can pick some decent companies some times

[pazzuzu] 13/3/2018 21:44

https://www.fool.co.uk/investing/2018/03/13/one-monster-growth-stock-id-buy-before-iqe-plc/Motley fool plug xlm. Although it is the fool so probably best to sell now lol

[hatfullofsky] 13/3/2018 18:30

Re Outlook : There was as very small snippet on growth in the in the webcast, around 9min in.

"We see the trend continuing through 2018 and the next few years"

[hatfullofsky] 13/3/2018 18:25

It's also in the accounts under financial review

[hatfullofsky] 13/3/2018 18:24

Net finance expenses for 2017 were $1.4 million compared to net finance income of $0.9 million in 2016. The Group has dynamic hedging activity in place to mitigate material exposure to foreign currencies. In 2016 the finance income recorded was driven by fair value gains for forward contracts, although not yet matured. In 2017 the forward contracts recorded a net finance expense.

[the juggler] 13/3/2018 17:57

Thanks for the update cgequityinvest.

[cgequityinvest] 13/3/2018 17:50

Just been to the investor presentation and a question was put to management about this. They confirmed it was indeed due to taking out forward contracts which allows them to hedge their foreign currency flows with expenses in Israel and other places and income in dollars and other currencies. Management were pressed about growth forecasts for 2018 and beyond. They were not prepared to give specific forecasts/targets but were confident that :Significant opportunities remainAs ever they like to underpromise and overachieveOry talked about aggressive opps for growth over the next two years. Will post more thoughts tomorrow.

[maiken] 13/3/2018 16:36

I think it may be a hedge they have have taken out which has been marked to market and where the hedging product price has moved against them

[simso] 13/3/2018 16:22

Does anyone understand the Finance Income / Expenses line, which shows a net $1,424k outflow in the P&L. Given our huge Cash Balance of over $40m, you would expect it to be positive inflow...as indeed it always previously has been. Last Year was positive inflow of $903k. The year before was £1756k positive. The first half this year was £345k positive so second half by deduction is an outflow of $1769k. An exchange difference put through P&L perhaps...in which case its "one off" and unlikely to be repeated next year?