Xp Power Investors - XPP

Xp Power Investors - XPP

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Stock Name Stock Symbol Market Stock Type
Xp Power Limited XPP London Ordinary Share
  Price Change Price Change % Stock Price Last Trade
-5.00 -0.25% 2,035.00 10:43:44
Open Price Low Price High Price Close Price Previous Close
2,035.00 2,000.00 2,060.00 2,040.00
more quote information »
Industry Sector
ELECTRONIC & ELECTRICAL EQUIPMENT

Top Investor Posts

Top Posts
Posted at 09/8/2022 12:15 by jamtin
I presume the debt has gone up due to the £33m acquisitions of FuG and Guth in January, that could also be part of the increased admin costs.

I think there is probably still a good business here, but I am very unhappy with the Board comms around the legal issue (let alone allowing it to happen in the first place). Aside from the delay in communicating the issue which jacks13 mentions, they now seem to be giving the bare minimum of information, and while that may be all they can do, there is nothing in the way they are addressing it to show they understand the concerns that we will have as investors and want to answer them as soon as they can.

I've held XPP for 14 years and it always used to have great, open matter-of-fact comms, under promise, over deliver, just the sort of board I wanted. I hope that wasn't all Duncan Penny.

Posted at 29/10/2021 14:49 by nerja
Interactive investors winter list,

Lio, Safe, Xpp, Hlma, Adm, Synt, SXs, Hils,

It’s performed very well over the last 8 winters

Posted at 03/8/2020 14:51 by valhamos
The results video and the investor presentation webcast - both on the website - are well worth the time. Semi conductor fab has been cyclical over the years and XPP suffered from the downturn in 2018 but XPP see the market as being very strong for the foreseeable future because of technological changes in both logic and memory sectors. This was also the view from the results last week at Lam Research (LRCX), a top 30 customer for XPP, which I also hold.
Posted at 01/8/2019 07:57 by felix99
XPP - love the company and mgt but its just swimming against the tide - I thought it would drop lower this am but I guess that is reflection of how it is held by investors
Posted at 03/12/2018 13:01 by robow
Moneyweek 30/11/18

The slump in XP Power’s share price is absurdly overdone. Investors should seize this buying opportunity.


Investors should never pay too much attention to short-term share price movements. But in the case of XP Power (LSE: XPP) it is hard to ignore the slump from £36 in July, when the company reported half-year results, to roughly £22 today. This decline is an absurdly harsh verdict on a growing, highly profitable business, cementing its foothold in its industry.

XP Power’s market value has dropped by more than a third, apparently because of a temporary shortage of components for the power converters it manufactures. These include industrial versions of the AC/DC power adapters used in electrical goods, and converters that increase or reduce the DC power in industrial equipment. Not only is XP paying more for parts, but it is also buying more of them to make sure it can meet demand.

Small hiccup
Even in the short-term, the impact of the increase in costs is likely to be muted, easily absorbed by XP Power’s fat profit margins and growing revenues. The company expects to wind down the extra inventory over the next six to nine months, and on a like-for-like basis, ignoring the positive contribution from two acquisitions and exchange-rate movements, revenue for the first nine months of the current financial year was 11% higher than the same period in 2017. XP Power also took 8% more orders, like-for-like, in this period.

For an investor to be greedy when others are fearful requires a high degree of confidence in a business and the way it is being managed. XP Power does not publicise the names of its customers, but ask the company quietly and it will reveal dozens of large multinationals. It says it is the market-leading supplier of power converters to industrial and medical equipment manufacturers in the USA, where it had 11% of the market in 2017, and Europe, where it had 11%.

Because XP already imports directly from Asian factories into a warehouse in Germany, the impact of potentially greater trade friction between the EU and the UK post Brexit should be minimal.

XP’s strong market position is all the more remarkable because over the last decade it has changed business model. Before 2006 it was a distributor. The company opened its first factory near Shanghai in 2009 and a second in Ho Chi Minh City in 2012, where it is building a third factory on the same site. Today, 78% of sales stem from products XP Power designed to be small, so they are easy to fit in machines, and efficient. Efficiency not only reduces the running costs of equipment, it improves reliability because efficient power converters do not require fans to cool them. Since fans are mechanical parts, they are prone to failure. Reliability is critical because component failure could interrupt an operation or halt a production line.

Highly profitable business
By designing new product lines and acquiring manufacturers of different kinds of power supply, XP Power has earned an average return on capital of 30% over the past decade, and average profit margins of 15%. The trick has been to supply more converters to the same large customers.

The company’s latest acquisitions mostly supply producers of semiconductor manufacturing machines, an industry with a cyclical reputation. XP’s exposure to this industry has thus risen rapidly in the past year (see below).

However, several factors shield XP Power’s profitability from swings in demand. It can take two or three years to design an adapter for a machine, test it and approve it, so once a manufacturer has given an XP Power adapter the nod, it is unlikely to swap the product for a cheaper alternative.

What’s more, the semiconductor cycle has hitherto tended to follow product launches rather than the overall business cycle. That prevents XP’s sales and earnings becoming too volatile. The impact of individual products such as smartphones may be falling anyway as semiconductors become ubiquitous in factories and homes. Demand from healthcare, meanwhile, is stable. At £22, XP Power is valued at about 15 times earnings in the year to December 2018, after adjusting for the small amount of debt it carried at the year end.
On the face of it, XP Power should be a difficult company for private investors to get to know well. The products are embedded in equipment manufactured by other firms, and to attend the annual general meeting you would have to travel to Singapore, where the company is domiciled.

Fortunately XP Power explains itself very clearly in publications such as the annual report. As all writers know, to explain something clearly you must first understand it, so clarity is a good sign management are on top of things. But clarity tells us more than that. A company confident enough to expose its strategy to competitors probably believes the strengths on show will discourage copycats, rather than show them how to compete. Given XP Power’s commitment to quality, it may be possible for another Asian manufacturer to run factories more cheaply, for example – even though XP-Power manufactures exclusively in low-cost economies. But could this rival also set up a global technical sales force sufficient to elbow XP Power – which boasts 32 offices around the world – out of customers’ factories?

XP Power’s marketing brochures, published on the company’s website, are imbued with the same clarity. Investors seeking to know it better will find much to reassure them in what the company tells its customers.

Posted at 30/7/2018 13:12 by johnroger
The first quarter dividend payment of 16.0 pence per share was made on 11 July
2018. The second quarter dividend of 17.0 pence per share will be paid on 11
October 2018 to shareholders on the register at 14 September 2018.

The compound average growth rate in dividends over the last 10 years has been
13%.

This stock has been an income investors dream

Posted at 31/1/2018 13:11 by valhamos
"I don't get this 'buy on a dip' approach if you're an investor. If you think something is worth buying, and you have a long term view then buy it."

"Having been invested here for a while it's now on my watch list as a potential sell if a down trend kicks in."

You didn't get my approach to investing; now it is my turn not get yours. Surely it can't be worth buying with a long term view and then a potential sell all within the space of a few hours?

Posted at 31/1/2018 10:50 by valhamos
"I don't get this 'buy on a dip' approach if you're an investor."

Everyone will have their own style so don't worry if it doesn't mean much to you.

XPP is looking and performing like a long term hold but when a share gets to 5% of my portfolio as is the case here then I tend to wait for the market to offer "sale" prices and take advantage. If that doesn't happen I am happy to stick with what I have got.

Posted at 31/1/2018 10:35 by villarich
I don't get this 'buy on a dip' approach if you're an investor. If you think something is worth buying, and you have a long term view then buy it. Yeah it might drop a bit and you could have got in early. The other side to that is it doesn't dip and continues rising.
Posted at 09/10/2017 16:33 by fozzie
I bought in 2003 and added in 2008/9. I sold the majority in the low 20's but have held my original 1500 share purchase to this day. It has been a great investment, very happy to hold and take the now amazing divi but maybe a takeout at £45.00 beckons? Anyone think a share consolidation might increase investor interest, for a company with a stand out track record like this one this is a surprisingly quiet board. A happy holder ;o)
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