• Mark Watson-Mitchell

Take a quick look at TLY, CNIC, IOG, FOXT and PMP

Totally (LON:TLY) – another healthy deal gives the shares strong appeal


Chairman Bob Holt openly declared that this group’s strategy was the progressive buy-and-build consolidation within the healthcare market. And to date he has kept his word.


The group today is a leading healthcare service provider in the UK and Ireland.


It works in partnership with the NHS and other providers to deliver healthcare services through its three main divisions of Urgent Care, Planned Care and Insourcing.


Over the last three months the company has announced a number of contract extensions, as well the acquisition of Energy Fitness Professionals, a corporate fitness provider.


This week it has agreed to acquire Pioneer Healthcare in a £13m deal. This company is an established independent provider of specialist NHS secondary care services. The earnings-enhancing acquisition boosts the group’s outsourcing capabilities.


Analyst James Wood at Canaccord Genuity Capital Markets rates the shares as a ‘buy’ and, on the deal, upped his price objective from 60p to 70p.


He also increased his current year estimates, to the end of this month he sees £124.4m of revenues (£113.7m), with adjusted pre-tax profits at £2.8m (£2.6m), worth 1.7p (1.5p) in earnings per share.


For the coming year he sees a bounce to £140.8m of sales, £5.8m of profits, giving earnings of 3.4p per share.


For the year to end March 2024 his estimates are for £155.0m of revenues, a very healthy £8.0m of profits and earnings of 4.6p. Which, no doubt, is why he has jacked up his price objective.


Another interesting year ahead for Bob and his team – making the shares at just 34.5p a very fit purchase, perhaps my second price aim is even more achievable now.


(Profile 12.03.20 @ 12p set a Target Price of 18p*)

(Profile 25.06.21 @ 38.5p set a Target Price of 50p)


IOG (LON:IOG) – these shares are for buying and not selling


On Monday morning analyst Daniel Slater, analyst at Arden Partners, issued his latest research note on this UK gas and infrastructure operator, upon news that pipeline backgassing at the group’s Saturn Banks had got underway, thereby enabling its Blythe and Elgood fields to come onstream and producing and then selling gas.


He stated that it was great news, especially at a time when gas prices are at historic levels.


Slater is going for the group to score £182.1m of sales this year to end December, producing an EBITDA of £169m. His price objective is 47p a share.


On the same morning Jonathan Wright, a director of research at brokers finnCap, issued an even more bullish note on IOG. He declared that the company ‘has an important future role to play in helping secure UK domestic gas supply.


His estimates are for £221.3m of revenues this year, giving an EBITDA of £206.5m, generating £181.1m of adjusted pre-tax profits, worth a stonking 29.2p of earnings per share. Accordingly, he has upped his price aim from 48p to a very healthy 66p a share.


With its shares at around 41p the group is valued at only £214m.


I note both brokers’ price hopes – due to recent events mine are now considerably more ambitious.


These shares are for buying and not for selling.


(Profile 06.09.21 @ 22.5p set a Target Price of 30p*)


CentralNic Group (LON:CNIC) – powerful equity backing fuels its growth


Last week saw this global internet platform group announce the $75m acquisition of VGL Verlagsgesellschaft, the German online marketing group, funded part by way of a £42m Placing and a £3m Open Offer.


Yesterday it was announced that deal has now been completed and that the group is now a member of the FT1000.


On Wednesday last week Max Royde, a non-executive director of the group, was mentioned in Directors’ Dealings following the purchase by Kestrel Partners of 6.5m new shares at the subscription price of 120p.


Royde is a partner of, and holds a beneficial stake in, Kestrel. He is also a shareholder in Kestrel Opportunities – he is therefore considered to have an interest in the total of 17.93m shares in CentralNic held by Kestrel Opportunities.


The total Kestrel holding, including those of its clients, is a considerable 63.05m shares, some 22.03% of the group’s equity.


Others with declared holdings increased after the Placing and Open Offer include Slater Investments, with 26.30m shares (9.19%), and Schroders, with 12.99m shares (5.17%).

The shares closed at around the 124.5p level last night.


As I have said before, do not underestimate the potential of this group, or its equity backing, as it proceeds apace in its expansion strategy.


(Profile 12.07.21 @ 89p set a Target Price of 110p*)


Foxtons Group (LON:FOXT) – a share buyback programme coming


Yesterday the London estate and lettings agency group declared a £3m share buyback programme.


It will get underway after the group’s AGM on 22 April, if passed by its shareholders. And why shouldn’t it? The shares have been a dismal performer since last summer.


Despite last week’s final results did not seem to inspire the market enough to get the shares moving back up again, if anything they have actually drifted off, now 32.5p.


I feel as though I have ‘egg on my face’ following my profile last July.


Would I average now, in front of the share buyback? Probably not, instead, I would just nurse the holding and not increase it yet.


(Profile 07.07.21 @ 60p set a Target Price of 76p)


Portmeirion Group (LON:PMP) – last year was smashing and so too are its shares


The brands of Spode, Royal Worcester, Pimpernel, Wax Lyrical, Nambe and, of course, Portmeirion are owned by this designer, manufacturer and worldwide distributor of homewares.


Its shares were up to 710p less than two months ago, last night they closed at around 570p, after hitting 520p at the start of this month.


This is a quality company, with excellent management and global potential.


It had a cracking year in sales in 2021, at around £104m, which was more than 10% better than market expectations – that was announced in its Trading Update in mid-January this year.


At the same time, it guided that its pre-tax profits would be at least £7m, again beating broker's estimates.


That was when the shares went to the year’s High.


On Thursday 17 March the group will declare its full results for 2021 and present itself to the City and to investors generally.


I see the shares going higher this year.


Analyst Sahill Shan, at Singer Capital Markets, has estimated slightly lower sales this year at £98.9m but with much greater adjusted pre-tax profits, at £10.0m, worth 57.4p per share in earnings compared to his estimated 40.5p for 2021.


For 2023 he is even more bullish - £107.8m sales, £11.8m profits, 66.9p of earnings easily covering a 22.31p dividend per share.


His price objective is 840p and understandably he rates the shares as a ‘buy’.


In these markets I see some incredibly overrated stocks on price-earnings ratios of 20 times and above – ratings that they don’t deserve.


So, when I view Portmeirion I see true ‘undervalue’ of a premium company.


I would not be at all surprised to see the shares breaking the £10 level within the next couple of years.


Hold very tightly.


(Profile 28.08.20 @ 376p set a Target Price of 480p*)


(Asterisks * denote that Target Prices have been achieved since Profile publication)

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