The OMG newsletter recommends at least 15 companies each month, using the writers’ experience of small caps to give you a winning edge. Last week they wrote about Appreciate and Kromek. Read about these Opportunities 4 Material Gains!
Mid-week Tip Wednesday 6th July
The e latest figures from Appreciate (LSE:APPS) mark the start of a recovery in the performance of the corporate incentives business following an extended period of reorganisation. Formerly known as Park, Appreciate no longer supplies Christmas hampers and instead provides multi-retailer vouchers and gift cards to both consumers and corporates. ppreciate offers a Christmas savings service to consumers, which receive multi-retailer redemption cards and vouchers. Consumer billings are still the majority of the group total, but corporate is catching up. The corporate division provides incentive and reward products, for customers and staff, including vouchers, VIP experiences and travel deals. It is also involved in the free school meal scheme. There was £132.1m of money held in trust, relating to the Christmas savings. This used to generate substantial interest income, but not at a time of low interest rates. This could become a greater source of income in the longer-term. Revenues are set to decline from £106.8m to £97.4m, while pre-tax profit should improve to £6.5m. That means that the shares are trading on just over eleven times prospective earnings, which falls to eight the following year.
Results Preview 11th July
Kromek (LSE:KMK)-Finals to April 2021 are reported on Wednesday. In March £13m was raised at 15p in an oversubscribed placing and open offer as the funds are needed to support its extensive commercial pipeline particularly in the growing medical and nuclear markets. The Covid effected Interims in September reported lower revenue at £4.6m (£5.3m) with a loss before tax of £3.4m (£2.7m). The Gross Margins are 54% so given increased turnover and deducting increased development costs losses could start reducing sharply. The outbreak of the pandemic has exposed the world to the severity of biological threats and their potential impact on public health and the global economy and has demonstrated the need to rapidly evolve bio-security systems and associated technologies. The Placing should have provided sufficient funding to cash flow positive and achieve operational profitability in 2023. Speculative Buy ahead of hopefully further ‘life-saving’ orders
Reviews from 04 July
Reviews
Reviews
IRR – 22.3p – Becoming Two Mines
AUK – 1.6p- In play
DNL – 65.5p – UK authorisation
AUTG – 22p – Small underlying profit
NFT – 25.5p – Cash being conserved with investments on the cards
QXT – 165p – Chairman buys
PCF – Investigation continues
Finally
Market may continue to drift until we are more clearly out of the Covid woods.
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