AvingTrans - 85p
The stock i said i will reveal over the weekend is AVG, iv been watching this for sometime, i liked the trading update on 14/12/04. Very Positive.
What annoyed me was they got some of their figures wrong which they later corrected.
Heres what they had to say though.
Avingtrans plc is pleased to inform shareholders that trading for the six
months to November 2004 is above board expectations. The whole group, including
the recent acquisitions of Crown (UK) Ltd ("Crown") and Stainless Metalcraft
(Chatteris) Ltd ("Metalcraft"), acquired in June and October this year
respectively, has performed above expectations.
Before contribution Including
from Crown and contribution from
Metalcraft Crown and Metalcraft
Like for like order intake has +67% +623%
increased by:
Like for like sales have +41% +210%
increased by:
Like for like order book has +33% +950%
increased by:
The Group's operating cash flow has also exceeded board expectations. The
directors are delighted with the organic growth as well as the performance of
the recent acquisitions in the interim period to 30 November 2004, all of which
bodes well for the outcome of the full year to 31 May 2005.
Interim results to 30 November 2004 will be published early next year.
950%!! and 623%!! When i see 200% i tend to jump for joy!
Look at the Broker Note too
Which was released i think on the 9th Dec, they have a 6 month target price of 125p
Their year end is end of Nov, they have already told the market what they can expect in the results, and the market is still in the process of reacting. This stock is definetly overlooked.
Lets have a look at the figures, if last year sales was 2.6mil and sales are up by 558%, thats roughly 17m in H1.
Operating margins from their 3 divisions are roguhly 10%, 10% of 17m is 1.7mil.
Times that by 2 for both halfs you get 3.4mil.
Note they also have to pay interest on their borrowings, which is about 7-8% which is roughly 4-500k, so a net profit of 2.9-3 mil. Which puts this stock on a PE 5 or 6.
imho the stocks still undervalued even at these prices, the great thing is tipsters havent caught on, so i think there is still alot to go.
My concerns are will they be able to maintain and continue growth at the same rate? The debt levels...
But on current fundamentals the stock is worth about 12 mil, thats CHEAP!! A company thats generating 3 mil in profit a year i would definelty pay 12 mil for this, wouldnt you?
The chart looks stonking too
I would buy all the way up to 100p, after that i would want further news, Results are mid february we can expect a decent run up imho.
