Data solutions, sustainable nuts, houses and motors
D4T4 Solutions (LON:D4T4) – next week’s finals will show the way
The AIM-listed data solutions provider will be announcing its end March 2022 full year results on Wednesday 6 July.
Just under a year ago the group’s shares were trading at their peak of 410p each, last night they closed at 250p, at which level they could well be ready to respond to good news and then charge ahead in price.
The Sunbury-on-Thames based company provides digital data collection, management and analytics solutions.
It serves the finance, consumer and other sectors in not just the UK, but also in Europe, the US and internationally.
Analysts Lorne Daniel and Kimberley Carstens, at the group’s broker finnCap, see the shares rising to 450p in due course.
For the last year they look for revenues to have risen from £22.8m to £24.3m, while adjusted pre-tax profits may well have fallen a quarter to £3.2m (£4.4m), with earnings off at 6.9p (9.5p), but actually increasing its dividend payments from 2.8p to 3.1p per share.
For the current year the brokers see £27.0m sales, a recovery in profits to £4.7m, earnings of 9.8p and a 3.4p per share dividend.
The analysts are impressed by the group’s Celebrus-powered Teradata Vantage, the market-leading mixed cloud data platform, which allows enterprises to identify and collect their customer interactions and understand customer behaviours and insights.
They rate the group’s shares as good value for a well-managed and well-funded high quality cash generative business with recurring revenue and huge growth opportunities in its particular markets.
At the current 242.5p its shares may look expensive, but such potential growth as D4T4 offers investors always deserves premium ratings.
Hold very, very tightly.
(Profile 09.04.20 @ 170p set a Target Price of 215p*)
Dekel Agri-Vision (LON:DKL) – doubling in size within three years
Last Thursday’s announcement of the 2021 finals from this West African sustainable products group showed record results.
The group’s established palm oil operations reported a 66.2% increase in its revenues at €37.4m (€22.5m).
After a loss of €0.4m, its new cashew processing operation, following some initial hassles, is now underway and looks to be a real potential winner for the £16.6m agribusiness group.
In fact, the cashew side is said to be a business doubler within the next few years.
Analysts Nick Spoliar and Charlie Cullen at WH Ireland see cashews moving to centre stage.
For the current year to end December they go for revenues little changed at €36.3m (€37.4m) with adjusted pre-tax profits halving to €0.4m against €0.9m in 2021.
However, it is the next year that will see a big turn-around in results and operations.
The brokers look for revenues to rise to €50.4m in 2023 and then €58.9m in 2024, with profits of €4.2m then €7.2m respectively. That would put earnings up to 0.5c then 0.8c per share.
They have a fair value assessment of 9p per share compared to the current 3.25p.
In March this year the group’s shares peaked at 6.67p each, so the fall back in price actually offers ‘penny stock’ investors another opportunity to buy into a potential mover.
(Profile 23.09.20 @ 2p set a Target Price of 3.5p*)
Springfield Properties (LON:SPR) – a canny deal adds real muscle and brawn
I really like this Scottish housebuilding group – it just gets out there and does its business and is growing at quite a pace in the process.
On Wednesday of last week, it announced the £46.3m acquisition of another Scottish high-quality housing group, Mactaggart & Mickel.
The deal was funded £10.5m cash and the balance £35.8m over the next five years as its homes are sold.
It takes in some 17 sites, all of which, bar one, have planning permissions totalling some 700 units.
The deal also gives Springfield access to the M&M land bank of 800 acres of freehold land and 1500 acres of option land across Scotland’s Central Belt.
A cracking earnings accretive deal, which make this enlarged group’s shares even more attractive.
Analysts James Tetley and Greg Poulton at Singer Capital Markets now have estimates out for the year to end May 2022 to have seen sales up from £216.7m to £254.0m, adjusted pre-tax profits of £21.8m (£18.5m) earnings of 16.2p (14.2p) and an increased dividend of 6.25p (5.75p) per share.
But taking a look at the current year and 2024 estimates shows sales of £355.5m then £394.3m, profits of £30.2m, then £36.0m, earnings of 0.5p then 22.8p and dividends of 7.3p then 8.0p per share respectively.
The brokers have a price objective of 185p a share and rate them as a ‘buy’.
They closed last night at 132p at which level I believe that participating investors will soon see another big price lift – they touched 175p a year ago.
(Profile 05.03.19 @ 114p with no set Target Price)
Vertu Motors (LON:VTU) – leave them to ‘idle’ for a while
At last Thursday’s AGM for the UK’s fifth largest automotive retail group its shareholders were informed that the trading outlook is unclear.
There is still a constraint in the supply of vehicles in the used market.
Although sales may well move gently ahead in the current year to end February 2023, it profits may well have more than halved.
Analysts Mike Allen and Rachel Birkett at Zeus Capital, which is the group’s NOMAD and broker, have estimates out for revenues of £3.68bn (£3.61bn0, while adjusted pre-tax profits will collapse from £80.7m to £35.4m, slicing earnings to just 7.5p (17.2p) while the dividend could well be increased from 1.7p to1.8p per share.
The group’s shares have been up to 75.80p in January this year, but now trade at just 57.30p.
It seems as though the biggest buyers for the group’s shares is the company itself as part of its ‘share buyback’ programme.
I consider that these shares have shown an excellent performance since my October 2020 Profile, having risen almost 150% - however, I would be loath to chase them at these levels until more is confirmed about the current year’s trading.
The interim results are due in early October, so hold tight.
(Profile 12.10.20 @ 30.5p set a Target Price of 40p*)
(Asterisks * denote that Target Prices have been achieved since Profile publication)