Pebble Beach Systems Group PLC (PEB)
Posted: April 2nd, 2021, 3:02 pm
I've been finding it harder and harder to find value in stocks lately as so many of them have risen a long way from early last year but here is one I think could have substantial upside in a recovery albeit it comes with more risk than I usually take.
https://www.pebble.tv/
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This was once Vislink but after some fairly disastrous mismanagement ended up as a standalone software company servicing the broadcast sector.
The market cap at 9p is about £11m and debt of over £7m takes the enterprise value to over £18m. The balance sheet is a bit weak with net tangible liabilities and net current liabilities but does show an improving trend. Net debt is also falling as the company seems to generate a fair bit of cash for its size due to the excellent margins.
In the last full year the company managed revenue of £11.2m and EBITDA of £3.8m. Reported net profit came in at £1.45m.
https://www.investegate.co.uk/pebble-be ... 00073994L/
This year has been tough for them, they claim due to coronavirus, and the most recent trading update suggests revenue of £8.4m and EBITDA of £2.6m so it has remained profitable on reduced turnover. They also expect the trend in debt reduction to continue.
https://www.investegate.co.uk/pebble-be ... 00102892P/
Kestrel Partners, who specialise in investing in software companies have built up a 29% stake and I believe they will wait for trading to improve and then force a trade sale of the business. I am hopeful that in a couple of years it will go for 20p+
https://kestrelpartners.com/
Therefore I have bought on the basis that there may be over 100% upside in a couple of years time as long as trading recovers once the pandemic is under control. Even if they just tick along at the reduced turnover I believe they are worth 9P a share.
Anyone have a view?
https://www.pebble.tv/
.
This was once Vislink but after some fairly disastrous mismanagement ended up as a standalone software company servicing the broadcast sector.
The market cap at 9p is about £11m and debt of over £7m takes the enterprise value to over £18m. The balance sheet is a bit weak with net tangible liabilities and net current liabilities but does show an improving trend. Net debt is also falling as the company seems to generate a fair bit of cash for its size due to the excellent margins.
In the last full year the company managed revenue of £11.2m and EBITDA of £3.8m. Reported net profit came in at £1.45m.
https://www.investegate.co.uk/pebble-be ... 00073994L/
This year has been tough for them, they claim due to coronavirus, and the most recent trading update suggests revenue of £8.4m and EBITDA of £2.6m so it has remained profitable on reduced turnover. They also expect the trend in debt reduction to continue.
https://www.investegate.co.uk/pebble-be ... 00102892P/
Kestrel Partners, who specialise in investing in software companies have built up a 29% stake and I believe they will wait for trading to improve and then force a trade sale of the business. I am hopeful that in a couple of years it will go for 20p+
https://kestrelpartners.com/
Therefore I have bought on the basis that there may be over 100% upside in a couple of years time as long as trading recovers once the pandemic is under control. Even if they just tick along at the reduced turnover I believe they are worth 9P a share.
Anyone have a view?