Pressac. Massively undervalued?

[Max Damage]

I think so mkt cap 111 million with 17 month 2000 profits (12 month was 19 mill)to come in at about 27 mill and 2001 forcast at 24 mill.

LONDON (AFX) - Shares in Pressac PLC were a positive feature in early
afternoon trading, mirroring the firmer market trend, and helped by news of
an
upgrade in rating by Dresdner Kleinwort Wasserstein, dealers said.
The German-owned brokerage has upped its stance for the electrical
equipment
firm to 'add' from 'hold', although it has also reduced forecasts for the
group
-- taking them down to the lower end of market expectations.
Dresdner Kleinwort lowered its underlying pretax profit forecast to
27.0 mln
stg for the 17 months to December 31 2000, down from 28.4 mln, and to 23.5
mln
stg for the the year to December 2001, down from 27.8 mln.
The broker pointed out that the mobile phone handset market has been
miserable since the middle of 2000, but although it is still not easy there
are
encouraging signs for Q2 2001, with demand appearing firmer and new models
emerging.
Dresdner Kleinwort noted that Pressac shares have performed miserably
recently, but it felt that investors should bear in mind comparators
ratings,
and added as well and that aside from telecom equipment, the group has an
above
average auto business where there is scope for upside.
In reaction, at 1.02 pm, Pressac shares were 12 pence firmer at
128-1/2, its
best levels for the session so far.
jmh/rn


Way way way too cheap so I bought some this morning at 123p.

Anyone else in here?

 

[cookie]

Hi Max

An old favourite of mine this one and have posted on fundamentals in the past.

Trades off a PE ratio of just 6.5 hence the cry of "undervaluation" however the fact that their growth has been due to the fact that the mobile handset and component
business grew from nothing to £16 million in a very short time and is the markets worry due to the well publicised downturn in Mobile phone demand for the future.

They have also spent £10million on a new factory in Scotland for the telecoms division and expected to commence volume manufacturing by Jan 2001. we just have to hope they have the orders to fill the capacity. This meant that gearing had increased to 66% and Debt to £40mln.

In actual fact the Automotive division turns over approx £148 million against the Telecoms and Industrial divisions £43 million.

Another problem is that the group suffers from a currency conversion shortfall in that 74% of goods manufactured and 85% of sales are made abroad.

Incidentally they have changed their financial year from 31st July to December 31st and we will have to wait until March or 1st April 2001 for 17 months figures.

An exciting prospect for sure. If you need any further info Max just let me know.


Good Luck



Cookie

 

[Max Damage]

Thanks cookie. I've looked through the company and feel the mobile components business has completely over shadowed the automotive business and as such led to a major oversold position based on that part of the company(read recent iii comments for an example of this). The whs smith situation is one to watch but according to the evening standard apparently dealers see Pressac as a takeover candidate.

 

[Turbo]

Hi Max,

I bought some last week at 120, and things seem to be picking up. I've been staying away from this board ever since the 'incidence' in the chatroom last week. As I stated then I no longer frequent the chatroom anymore. And as I said then I'm too happy to admit that everybody (well almost everybody) in the chatroom was tremendously helpful and supportive. So thanks to those with whom I had the pleasure of talking, it was good while it lasted. I will keep an eye on this board however. Perhaps I might email gold or sefty to clarify things.

regards

Turbo

 

[Max Damage]

What incidence Turbo?

You post on citybull also don't you. I have posted there a few times but under my old handle. Nice to see 3 of my shares buck the market today

Plasmon, Pressac, and Mice group

 

[Uncle]

Turbo.........No idea what the problem was in the Chat Room, BUT, Chat rooms are just that.....no reason for you not to be active on the BB. I for one will look forward to your posts.

 

[Max Damage]

Very strong buying today. It looks like this one is ready to run. Aegon and Equitable life have sold so could the overhang now be cleared?