Quindell Portfolio: Trading statement. Just too cheap!
Quindell Portfolio (14p and 6.4% of JIC) has issued a trading statement for the year ended 31st December 2012. It is extremely positive with it saying that results will be above the upper end of market expectations with eps at 1.29p per share. Operating cash flow is ahead of expectations with year end cash at £47m compared to forecasts of £41.5m. Management say the new financial year has started strongly.
The shares have been weak during December and January. Hopefully this statement will stop the rot. On consensus forecasts the shares are now valued at less than 6x 2013 earnings. This seems far too cheap to me.
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On 1st January 2012 I set up the JIC portfolio with £151,110 cash.Under "Transactions" you can see how it has been invested, "Portfolio" shows the current portfolio and my approach to investing is described under "About Me". A history of all my postings can be found under "Company Blogs". I… ...read more or visit website »
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Quindell Portfolio Plc, formerly Mission Capital Plc, is a holding company engaged in selling of software and consulting services, and the provision of technology enabled business process outsourcing services to brands operating in telecoms, utilities, retail & e-commerce, finance, insurance, health & legal, government & public sector . The Company operates in two operating divisions: Software and Consulting and Technology Enabled Outsourcing. The Software and Consulting Division provides software, business and technology consulting services, administration and management services, white labelled solutions, e-commerce, membership services, SaaS solutions and other services. In April 2013, it acquired Compass Costs Consultants Limited and Abstract Legal Holdings. In April 2013, Quindell Portfolio PLC acquired the entire share capital of inter8 Inc. more »
2 Comments on this Article show/hide all
Hi John,
Have you read this thread on TMF?
http://boards.fool.co.uk/quindell-paulypilot-12709345.aspx?sort=whole#12710269
They do seem cheap on EPS forecasts but surely 6.4% of portfolio seems a bit high weighting for a company with such high risk characteristics? (rapid growth by acquisition, poor cash conversion, excessive placings, management history, alleged poor staff behavior)
In reply to dangersimpson, post #1
Hi Paul,
I last traded in this stock in July when I added to the existing holding, taking the total to just under 3% of the portfolio. I have been happy to run it as I quite like the underlying strategy, although with hindsight I should have let a third of the holding go in November. You make valid points that are clearly shared by others in the market hence the "mistrust" that is reflected in the share price. I would like to see management bed down last years acquisitions and start generating cash. I think at 14/15p the risk is to the upside but take your point about the size of the holding and will look to take some profits in the next few months.
I was never a shareholder in TIG but clearly there are lot of scarred memories. From what I can see the market, still enamoured by "tech" stocks put it on a ludicrous rating from which it could only collapse!