TG21 - troll-free thread

Hi Nod, thought I'd pop in again to see how many irrelevant posts the thread had attracted. I wasn't disapppointed. Why does anyone bother with these guys? Everyone knows they're just here to disrupt things, so I'm sure no-one pays a blind bit of attention to their posts these days - if they're not filtered already by everyone that is.

It's highly amusing to see how much time and effort they can waste posting this stuff. I'm posting the T.M.F summary again as a useful guide, and to see how many posts it attracts on a Saturday night when if these people had a life they'd be out enjoying themselves like I'm about to do.

Have a good evening all. See you tomorrow:


"Daniel Stewart have a new Buy note out on TGP. I'd hazard a guess that for them to be so precise so close to the year end they have to be pretty confident TGP will achieve the numbers:



They've reduced 2005 EPS forecasts slightly from 2.22p to 2.14p due to a disallowed 2004 accrual increasing the tax charge, and 2006 EPS from 2.62p to 2.37p due to increased expenditure on expansion in 21st Century and Datatool - but net debt forecasts have been decreased from £5.2m to £4m.

The current 11.12p share price puts this on a P/E of 5.2 for the year about to end and a P/E of just 4.7 for 2006.

In summary:
"Conclusion
The improved cash flow in 2005 has given the company the opportunity to increase investment by £600k in 2006 to allow the business to grow more rapidly. At the current price the FY06 and FY07 P/E ratios stand at 4.7x and 4.1x respectively and the stock is trading at NAV. We believe this undervalues the growth prospects and have a BUY recommendation."

At 11.12p with a £9.1 m/cap the shares are trading at just above NAV of £8.5m as at 30/6/05 (note no goodwill here).

Halfords' results on 28th November were interesting and encouraging for suppliers like TGP - this piece from Citywire outlines the potential for the side of TGP's business distributing speed camera warning devices, SatNav, DVD players etc - and that's on top of the potential of the 21st Century CCTV side:


Extract:
"With only 50% of the country's 30 million cars having a CD player, there is still scope in this market, but Halfords is looking more to MP3 players as a Christmas big seller with an iPod-compatible device currently available at £99.99.

The costs of satellite navigation have come down from around £600 to £200 in the last year or so, and with less than 10% of cars having one, Carter sees plenty of potential.

Similarly with portable DVD players, which are currently almost exclusively used in cars owned by families with young children who are kept quiet on long journeys watching their favourite films from the back seat."

TGP were also tipped last week in Shares Magazine (they got the m/cap wrong!):
"TG21 (TGP:AIM) 10.5p
Spread: 4.65%

Changed its name from Toad in May but under chairman Peter
Ward, formerly of Rolls Royce (RR.), the transformation goes much
deeper than that.

TG21 bought 21st Century in the spring and has repositioned
itself as a leading installer of security systems for public transport
providers. The company already provides CCTV and black box
tracking devices for Arriva. In these security-conscious times
progress at Stagecoach and First Group cannot be ruled out.

The company derives strong free cashflow from its legacy
businesses, such as the installation of car security systems, handsfree
kits for mobile phones and speed cameras. But Roger Tejwani
of Daniel Stewart suggests the name change may mean that TG21,
which has a market cap of £10.6 million, is still an undiscovered
story. A PE of barely 4 for 2006 certainly suggests as much, as any
new CCTV contract wins could boost the share price."

Finally TGP also launched new products in October which to me (as a non-bike owner) look terrific:


"TWO WORLD FIRSTS FOR DATATOOL
18/10/2005

Datatool is launching two exciting new products at this year's Bike Show. Both products are 'world firsts' for the company and promise to generate great excitement at the Show on stand T159 - Hall 19.

INFORAD FOR BIKES - the world's first speed camera location system designed specifically for motorbikes. Inforad, priced at just £99.95, is based on the highly successful car-based product launched earlier this year. Datatool technicians worked closely with Inforad to develop a product specifically for use under the most challenging of motorbike conditions.

TEXT-ALERT – a system designed to alert bike owners, via text message, that a motorbike is being tampered with. Datatool's Text-Alert system has a web-based tracking facility, and priced at £199.99 offers unprecedented security and cost effective peace of mind."

I believe the downside for TGP is limited, due to the NAV and the extremely low P/E ratio, whilst the upside could be as much as a one or two-bagger if TGP's results come through as predicted, and in particular if 21st Century (the CCTV arm) announces extensions of its Arriva relationship with Stagecoach etc.

Interestingly, 21st Century's list of clients on its web site already includes Stagecoach, TFL, Alexander Dennis etc. I can't say at what stage these relationships are - but it augurs well in terms of further roll-outs of 21st Century's technology and future news flow.

TGP has something to prove to the City due to a chequered history (as Toad), which may be the reason for its low rating. It issued a trading statement on 2nd February 2005. I'm hoping that this year's will be issued a bit earlier, and due to all of the above will be full of good news.

This reminds me of a company called HPS (Hercules Property), which I invested in when it was at a low due to past let-downs and City nervousness about the directors. That turned out to be a four-bagger! It's often these unloved and unrecognised situations which turn out to be big winners (though TGP's share price has been climbing nice and slowly recently, and just prior to the year end too, which is encouraging).

As long as TGP aren't exposed by the need to find new auto products to distribute, or by 21st Century's current apparent dependence on Arriva, I believe TGP could be a big winner over the next few months as its reputation and performance is re-assessed.

If anyone is unfamiliar with TGP (Paulypilot is a holder and I believe it's been posted about here a few times before) here's their web site and a quick synopsis of their divisions:



"Public Transport CCTV Division

Through its subsidiary, 21st Century, the group provides leading edge CCTV and black-box technology which improves safety on public transport vehicles and allows operators to monitor their fleet and reduce insurance and claims costs.
For more information visit cctvonthebuses.co.uk.

Technical Services Division

Providing installation services for vehicle aftermarket products such as hands free car kits, wireless tracking, security systems and in-car audio and multimedia systems

Insurance Services Division

We are the insurance services experts, providing an industry leading claims handling, fulfilment and inspection service to the UKs leading insurance companies

Vehicle Technology Division

Distributing a comprehensive range of automotive products - from market leading security systems to reversing aids, audio, navigation and multimedia systems

Datatool Motorcycle Division

The Uks leading motorcycle security brand to both the specialist aftermarket and original equipment manufacturers"