I was curious about why Wandisco added WHIreland as a corporate broker when they already had two. The short answer is that WHIreland are good for reaching institutional investors.
Just from a google search, institutional investors include mutual funds, pension funds, endowment funds, insurance companies, commercial banks, and hedge funds.
MiFID II regulations were officially implemented on 3 January 2018. They mean that firms that provide research to institutional investors can't bundle it in with charges for share dealing. Usually that means the institutions have to pay for the research. WHIreland charge their corporate clients (e.g. Wandisco) for producing research, which means they can distribute it for free, and being free to institutional investors means it's widely distributed to them.
Fund managers are concerned about the possible effect of MiFID II on smaller firms providing research, so they're tending to use only the providers they have confidence in, which usually means the bigger ones. WHIreland only have a market cap of £42.6 million (assuming "WH Ireland" is the same as "WHIreland"). Just my own guesses - size might not matter so much to institutions when the research is free, or is about small firms. Being founded in 1872, the firm's age might help to make them look respectable to institutions.
This piece https://www.reuters.com/article/us-markets-brokers-mifid/as-day-of-the-mifid-approaches-specialist-brokers-advance-not-retreat-idUSKBN19W18B says that smaller "sell-side houses" aren't doomed, as they can move into research on small niches abandoned by big peers.
After emailing Wandisco's investor relations, I got a very helpful response. I wouldn't have got on the right track without them, but they aren't responsible for any mistakes in this comment (of course, do your own due diligence if the issue is material to your wealth).
Much of what I said is confirmed in "WHIreland is team and asset building in 2018"
Find "Turning to the other great subject of recent years" to skip stuff about wealth management. There's also stuff about MiFID II on page 24 of the latest Investors Chronicle.
My Buy rec after a string of good news releases immediately, immaculately and embarrassingly signals a dramatic fall in the SP.
Well, well, well, a placing!!! 25% off. £8 to £5.50,ah but with a pretty tight 2.7% discount on the price on the day.
Ooh look, it's going up again.
Welcome to AIM.
Oh gawd, while I'm here, who the hell are these bookrunners Stifel Nicolaus Europe Limited ("Stifel")? Golly, Stifel/Wandisco search comes up with a pdf dated Nov 7 recommending a Buy on Wandisco at £8.25. Amazingly a month later they are flogging it round the City at £5.50. Who knew???: Hope none of the clients are cross about that one!!!
And we can relax, their target is £10.29 -- love the precision.
I'm just bitter because I don't use Stop Losses ....
Front page of FT.com today https://www.ft.com/content/842d33f4-28d1-3793-b6e0-45b05e0701f4
Says we have done a deal with Dell worth $1m a year, short piece but nice, ending with a list of our clients as follows Amazon, Cisco, Google, HP, Microsoft and Oracle. IBM is also in, of course, and a quick Google reveals SAP as a very early partner, back in 2013.
So far no disappointment, I suppose Chickenlicken might say .... quite the opposite says I.
It's ironic that all my ho-hoper punts are full of wiseacres pontificating about how much money they are or are not going to make, and the real go go stock has tumbleweed blowing across it....
Just wondering if anyone had any views on when this baby might stop growing? Anyone done any numbers? I daren't sell now, but there is even a danger of tax problems, not having had the sense to get this into an ISA in time ....
$2m isn't bad, upfront in 30 days. Big retailer .... there are a few of them .... surely they might make some money soon! Back up to the previous peak near enough, onwards and upwards, one might reasonably surmise.
I'm having lunch with my buddy next week, who has similarly strong nerves. Those charts you posted came up a bit blurry, but I'm not a great chartist myself, barring spotting the odd head and shoulders etc. I suppose at 380 it also bounced off the 10-week moving average. I'll get some more if it goes there again.
Well done on banking profits around that 5.00 mark.
I have attached a link to a chart I follow looking at the fib levels to expect buying support to kick back in. As you can see it was come back 50% to that 3.80ish level.
I am waiting to watching to see the 61% or 76% area of 3.50 or 3.00 get tested. Any around 61% to start to re-buy may not be a bad area. Considering how much it can run up I would not be surprised to see it go the other way as well.
It may not have been advice, but I followed it. So I did some top slicing at 498/500. Now unsliced a few at 395 to Buy
Unauthenticated gossip below, from a friend who attended the results presentation, absolutely no guarantees or warranty, DYOR:
CEO and FD very bullish
$11m revenue baked in to 2017 from previous licences (FD)
50% of 2016 revenues upsells through channel partners to previous clients as customers increase number of server licences.
Huge addressable market as companies migrate data to Cloud. WAND probably tapped less than 2% of companies via its strategic partners IBM, Amazon, Oracle with Microsoft and Google still to make significant sales on WAND's behalf.
FD believes WANDs active replication technology monopoly is unassailable 7 patents for technology, 25 pending.
(at the time of writing, I hold a long position in this share)
Preliminary results for the year ended 31 Dec 2016.
By any measure, these are lousy results out today. Thats to be expected though, as WAND has a terrible track record of losing money & burning prodigious amounts of cash.
So why is the market cap so high, and more to the point, why do I have a long position in this?!
Were in a bull market, and convincing jam tomorrow shares are mainly going up, sometimes by a lot.
WANDs software does sound genuinely ground-breaking, and sales partnerships have been set up with major companies like Amazon, IBM, and Microsoft.
Theres strong growth in bookings starting to come through. Although sceptics point out that bookings are multi-year, so dont translate into much increased turnover yet.
Cost-cutting means that cash burn is reduced.
It looks likely that another fundraising will be needed. I dont see that as a problem the company has raised money before quite easily, and the newsflow & share price are much higher now. So it wouldnt need much dilution say 10%, to push them over the line towards cashflow breakeven, I reckon.
My opinion this share divides opinion like only a few companies can do. Were currently in a big bullish phase. This was reinforced by very bullish articles a few days ago, including one in respected tipsheet, Small Company ShareWatch. Its respected because the model portfolios it has run for many years now, have done extraordinarily well. SCSW has a rare ability to spot stellar growth stories quite early on.
Personally, Ive already top-sliced my holding, and got my cost price back. So am happy to run with the profit, and see where it goes. The bull case is very convincing, but trouble is, so is the bear case! Ive no idea which one will prevail in the long run.
I'm not great with accounts but these seemed good in line with raised expectations. DYOR!
The share price dropped initially, I think probably on the almost-unchanged revenue, and early reports in the Standard and FT picked up on this. However there is plenty of good news to justify the current bounce: the massive rise in Bookings (I presume meaning sales agreed but not paid for) up 183% for the Big Data product gives solid hope for the future, as does the turnround in the Source Code Managment business, where revenue actually fell by $1m in 2016. This was concealed in the overall numbers by the near doubling of the Big Data revenue from $1.8m to $3.2m, and after what sounds like a kick up the backside new bookings for the Source Code business are up about 30%, so these combined should produce substantial quantities of Jam Tomorrow.
Thank goodness for someone prepared to do some real research, thanks IOMIN.
The fact that only three of us appear to own the shares seems also to provide some upside!
Hanging on for now -- but selling is always my weak point. Results due Wednesday, which should produce a mild sell-off, I would expect. But I closed my eyes and hung on when the SP tocuhed 400, and that decision was rewarded, so I think for now hang on and take a good look at the numbers when they come.
This is still work in progress, so the market has to allow for some future growth.
(at the time of writing, I hold a long position in this share)
Trading update - this former glamour tech stock has had a rough couple of years. That's because top line growth stalled, and heavy losses made it look as if the writing was on the wall. However, perhaps surprisingly, investors continued to pour money into it, in several fundraisings. Overheads were cut considerably last year.
So, as I mentioned in my last report (Oct 2016), the key to survival is to start generating some decent top line growth. Today's update delivers strong growth. It's the first genuinely positive statement I can remember from this company. Hence why I've dipped my toe in, with a smallish very speculative purchase this morning. If the facts change, I change my mind. Mind you, I can never really be sure with this company what are facts, and what is spin!
Given the false dawns in the past, I can understand most people being highly sceptical, and wanting more confirmation that things really have turned a corner.
There's lots of detail in today's announcement, but it all seems to read positively, with meaningful growth, and reduced cash burn;
A couple of comments on the above;
Sales bookings were up 36% in H1, so the rise to +109% in H2 is a big sequential improvement in growth.
Revenue seems to lag behind bookings, so that's important to factor into forecasts.
Cash burn - it seems to have burned about $4m cash in H2, by my calculations (net debt of $2.8m at 30 Jun 2016, plus $14.3m new equity funding net of fees, less closing net cash of $7.6m at 31 Dec 2016 = $3.9m cash burn). I hope that's right - it's not clear from today's RNS if the $7.6m is net or gross cash.
Q4 was close to cash breakeven, but I am told this is the best quarter for cash collection, so may not be typical of future cash burn.
Outlook comments - as follows;
Strong order book and sales pipeline continues to underpin medium term growth expectations...
We have begun 2017 with a strong new business pipeline and a significantly reduced cost base, which together, will further our progress towards profitability.
So it's still loss-making, albeit at a reduced level. I'm usually wary of companies that refer to the medium term being positive, as it hints that the short term isn't so good!
My opinion - historic performance has been lamentable, and I was convinced this company was heading for the knackers yard. However, deep cost-cutting last year, and very strong top line growth in H2 2016 have dramatically improved the outlook, in my view.
I imagine another fundraising will be needed at some point, but that's not a problem once the share price is roaring up, and good news is flowing.
This share has been a big tech favourite in the past, and I suspect it might become so again, if the positive newsflow keeps coming.
It's clearly only of interest to growth investors. Value investors will understandably shudder in horror that a serial under-performer, and cash burner like this is valued at nearly £100m.
However, the big name contract wins & positive sales momentum developing now are exactly what tech growth investors look for. They can chase up valuations to eye-watering levels in this kind of market. That's why it's starting to look interesting, in my view.
Obviously if the sales momentum konks out, then the share price would crash back down again. So it all hinges on whether that decent growth reported today can be maintained, or not. So a high risk, but potentially interesting situation, in my view.
confess i felt plenty of trepidation when i saw the trading update notification in my inbox before the market opened.
A pleasant surprise to find my modest commitment to Wandisco being rewarded. They do need to demonstrate that this is the start of a positive trend rather than just a spot of good fortune but things appear to be looking up.
And lo, the benefits of Big Data. Now looking for analysis. But I see no reason why the implications of all this should not generate a bit of momentum going forward.
Key financial highlights
· Record bookings secured in Q4 2016 up 97% to $6.1 million (Q4 2015: $3.1 million)
· Bookings in H2 2016 up 109% to $9.6 million (H2 2015: $4.6 million)
· Total bookings for the full year 2016 up 72% to $15.5 million (2015: $9.0 million)
· Cash of $7.6 million at 31 December 2016 (30 June 2016 $1.1 million)
· Cash burn reduced to $200k in Q4 2016 (Q4 2015: $6.9 million) showing a significant reduction in overheads
· No borrowings on the revolving credit facility ('RCF') as at 31 December 2016 (30 June 2016: borrowings on the RCF of $3.8 million)
I'm still here and happy. Last year we had results at the beginning of March. This year's are crucial, as we should be seeing the benefit of the Big Data sales, whatever the widget thingy is called. If not then Paccamac will have the last word.
I suppose what I am thinking is that surely this guy's backers are going to pile in and buy a few shares now to show their support, aren't they? Aren't they? Whistles nervously.
Alternatively of course as hedge fund managers and similar they have all shorted the shares.
You takes your choice ....
FT today has various short notes on the subject, generally not impressed with the company or bouncing boy Richards, reinforcing paccamac's view. These will not help.
Now the halfwit board brings Richards back, and lo and behold the price tanks. The so-called institutions which supported him need their heads examined. Bet he gets a welcome back compo packet. And we get the shaft. Paccamac, I take back those unkind thoughts.I would say sell, but the fat lady is maybe yet to sing here ....
So the CEO resigns with no notice and the share price rises by 15%. WIHIH? I think is the appropriate acronym. Anyway positive noises re breaking even, is perhaps the cause of the latter event.
GLA, holding tight! But with a bit of momentum, this has been ticking up for a while, now breaking out ... lot of potential here.
DYOR to put it mildly.
Wild share price movements aside, there is no basis for investment here for a PI. WD is a speculative punt and an absolutely terrible one given they issue shares like confetti and have achieved next to nothing in 10 years.
The management are a parody of dot.com excess and their so called big data technology is nothing to write home about.
Read Edison's note on WANDISCO, out this morning, by visiting https://www.research-tree.com/company/JE00B6Y3DV84
"WANdisco has announced an OEM agreement with IBM, whereby IBM will embed an IBM-branded, customised version of Fusion into its BigInsights solution set. This is an important step as the company executes its indirect sales strategy, enabling WANdisco to leverage IBMs global sales footprint and installed base. Our estimates do not change, but financials will be supported near term by IBM-funded development work, while royalties should start to support scalable growth from H2 onwards ..."
from what I've learnt previously..the cash comes in up front but the revenues can only be recognised over a longer time frame.
yes, I agree that straws in the wind stongly suggest a fundraise is imminent.
if they have sustained momentum on the small initial contract front then they will have the makings of material earnings growth further out on the assumption that customers move to full utilisation as others have. However, this looks destined to come too late for current shareholders unless they can bring a several $m rabbit out of the hat.
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