OMG! Tuesday 12 April: Summary of last week’s newsletter

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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 Cirencester-based Hercules Site Services. Read about this Opportunities 4 Material Gains!


Mid-week Tip

Infrastructure spending benefits

Cirencester-based Hercules Site Services  (LSE: HERC) got off to a good start when trading in the shares of the labour supply company commenced at the beginning of February. The share price opened at 52.5p but it has subsequently fallen below the 50.5p placing price. Hercules can provide civil engineer and construction clients with workers that have a wide range of skills including bricklayers, carpenters, ground workers, security and site engineers.The company also hires out suction excavators and sometimes there are cross selling opportunities with the labour supply business. Clients include Balfour Beatty, Thames Water, Costain, Kier and Highways England. Last year, one customer accounted for one-quarter of revenues and another for 23%. In the year to September 2021, revenues recovered to £32.8m, although pre-tax profit fell from £1.01m to £516,000. The decline in profit was due to a £601,000 bad debt owed by NMCN, the first in the history of Hercules, and £297,000 of costs related to the AIM flotation. Excluding those, the pre-tax profit was £1.4m. Coronavirus grants fell from £249,000 to £53,000. A dividend of 1.7p a share has been declared for the year to September 2021. The shares go ex-dividend on 28 April. Hercules Real Estate has waived this dividend. The target yield based on the placing price is 3.5%. At  47p with a Mkt Cap of  £28m Hercules is in a market where there should be continued capital investment and demand for skills that are in short supply. Buy.


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Preview Holiday

Easter is giving companies a break from the usual reporting calendar, but it will pick for the next week’s report.  OMG! is  not on Holiday and there will be a new recommendation on Wednesday.



ATQT – 30.5p – Non-stop Shopping

CYAN – 16.75p- Making Connections

AGM – 19p – Some JAM tomorrow

TRCS – 1010p – US opportunities

NFC – 1304p – Organic growth

BLV – 270p – Revenues holding up 

TPFG – 360p – Financial adviser numbers increase

ELCO – 93.5p – SaaS transition

NFT – 1.9p – No Pluto deal

QXT – 150p – Higher value added 

ANX – 137.5p – Depressed share price

XPD – 39.25p – Warehouse problems

NAR – 52.5p – Discount to NAV

DNL – 15.75p – Chief executive leaves 



UK  Inflation is reported on Wednesday which could jump to 6.7% for the March y-o-y, which is not a surprise, and the Unemployment Rate is likely to decrease to 3.8%. It seems that recession concerns can take an Easter holiday.


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