Another great set of results which from the SP hike in the last few days the market was expecting. The only negative to me was the absence of an inaugural interim divi - never mind. I'll file this one in the growth section of the portfolio and keep holding.
Never looked at Fever-Tree share price chart before. Since floating in Nov 2014 SP has been going up in a more or less straight line on a log scale at a rate of 138.4% pa. Wish I'd bought shares in them in 2014! Up 1250% from 7 Nov 2014.
Thought name was familiar and noted I bought a bottle of their premium tonic water from Waitrose recently so looks like they have found niche market.
Found this Times article but is from 26 July so not reason for today's rise, however is an interesting article on history of Quixant. To access full article need to register but no cost involved just name, email and think up a password.
"James Wood, an analyst at Canaccord Genuity, which initiated coverage of Quixant this week with a buy recommendation, has a 500p target price on the shares. Benjamin May, an analyst at Berenberg, is shooting for 600p. " + a bit more on Brazilian expansion prospects.
Good timing on top up. I missed the boat buying near previous peak on 20 Apr this year. On mid price now up 0.5% on gross purchase cost. Will be happy if SP gets to 600p in next 12 months and will probably take profits if that happens.
I think you are right that Berenberg 600p was probably trigger for recent rise.
Problem with QXT is that to grow they need to keep increasing sales of their specialist gaming computers, which is not that easy as market for them not huge. SharePad (consensus of broker analysts) has forecast for pretax profit growth of 47.8% so perhaps 600p SP target obtainable.
Quite a lot of sizeable trades going through. Looks like institution(s) building a stake in QXT. About back to my purchase cost after price drifted down for a couple of months (was getting near stop loss trigger point).
Bought some yesterday and some more today. Did not have to pay anywhere near ask price of 415, got for about 409. Nice that now no stamp duty on AIM shares, makes up for wider spreads.
Slight cause for unease in that I notice from SharePad that institutional investors have reduced their holding by 9.5% in the last 3 months. Profit taking I imagine. They are pricey with a PE of 27.1% but will be OK if they can continue to grow at the forecast rate e,g. normalised EPS growth of 31.2% pa. SP flat today according to official (mid-price) closing prices for yesterday and today.
finnCap update on today's update, taken from Research Tree:
"This is an exceptional first-half performance from the core Quixant business, driven by growing Tier-1 penetration, and an impressive first full six-month contribution from Densitron, which has not only grown under Quixant management but delivered significant profit as well. Overall, group H1 sales more than trebled YoY to $41.3m, including a full half of Densitron acquired last November. Underlying this was strong organic sales growth from both the original Quixant business (revenue up 56% YoY to $21.2m) and the acquisition (revenue up 33% YoY on a constant currency basis). This was ahead of our expectations and leads us to slightly upgrade our FY 2016 sales forecasts. Cash flow is as usual very strong in H1, and the net debt taken on with the acquisition has been halved to $3.4m from $7.9m at the year-end. Management enters H2 with confidence and expects to achieve FY earnings forecasts; we retain our expectation of $13.0m adj. PBT and 15.7c FD adj. EPS and raise our target price to 250p, a 21x P/E rating on FY earnings, which we feel is easily justified by the near 40% earnings growth."
Low Forecast PER (<16) & PEG (<0.7) and good EPS Growth (>15%) - No
2016 PER is nearly 20 which is high but with nearly 67% giving a low PEG of 0.29 which is good
2017 Valuation is great
2015 Results showed it beat broker ESP Forecasts by 10.3%
2016's EPS Forecasts have been increased by 48.3% from 7.35p to 10.9p
The Below are based on 2014 Results as I dont have 2015's yet
Positive 1 Year Relative Strength - Yes
Positive 1 Month Relative Strength Yes
ROCE of 20% - Yes 35%
Profit Margin of over 7.5% - Yes 22%
Cashflow Per Share greater than EPS around 1.3 - No 0.35
Low Gearing Yes -16%
Quick Ratio over 1 - Yes 3.5
Director Share holding >10% - Yes 39%
Dividend Yield (a nice to have) forecast Yes but very low
Positive Outlook Statement - YES
We have had a strong start to 2016 in both our core business and also gaming monitors and with the potential opportunities Densitron provides in other markets, I am confident the Group is well placed to deliver strong growth in 2016 and beyond
Going to keep a close eye on this and if the price dropps a little I may make a small purchase of around £1500 as the 2016 PER is high at 20 and EPS is less than Cashflow
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