16th Jun 2022. 9.00am

Regency View:


Regency View:


Somero says non-residential US construction market remains healthy

Somero (SOM) released an-line AGM statement this week…

The US cement screeding company said the “non-residential construction market remained healthy and therefore trading has been tracking well”.

Somero expect revenue, profitability, and cash generation to be “in-line with the full year ending 31 December 2022 guidance provided in the 09 March 2022 final FY 2021 results statement.”

The shares have undergone a steady pullback from highs – mirroring the sell-off we have seen in US equities due to increased expectation of aggressive monetary tightening from the Federal Reserve.

From a forward valuation perspective, the stock remains attractively priced – trading on a forward PE of 7.1 which is one of the best in its sector. And the PE also looks compelling relative to forecast earnings per share (EPS) growth of 86%.

SOM Daily Candle Chart

SOM Daily Candle Chart

Eckoh up on upbeat outlook, higher order levels

Eckoh’s (ECK) share price rallied from support yesterday following the publication of an upbeat set of Final Results…

The data security solutions provider said it expects FY23 revenue and profit to be “significantly” higher than FY22, driven by demand in the US market and recovery in its transaction volumes in UK.

Eckoh reported FY revenue of £31.8m versus 30.5m a year earlier and said that current order levels were “substantially” ahead of Q1 FY22.

CEO, Nik Philpot said:

“We have started the year strongly and looking ahead the Board expects FY23 revenue and profits to be significantly higher than FY22, reflecting our ongoing organic growth, continued momentum in the US market, a sustained recovery in UK trading, and the integration of Syntec.”

ECK Daily Candle Chart

ECK Daily Candle Chart

Spectra Systems lands further contract revenue from central bank

The beauty of contracts with large institutions for critical processes is that they tend to not only be ‘sticky’ in nature, but also expand in scope and profitability, and that is what we’re seeing with Spectra Systems (SPSY)

The bank note cleaning specialist told investors this week that it had executed an amendment to a contract with an existing central bank customer and it is expecting increased revenues of around £2m.

The contract is for new sensors that are under development and the new contract relates to an expanded flexibility in their use, the company noted.

CEO, Dr Nabil Lawandy commented:

“We continue to provide cutting edge capabilities to our central bank customers who depend on us to respond quickly and effectively to their increasing requirements…

“This additional contract will increase the development phase from US$8.8mln to US$10.8mln while maintaining the existing timeline for sensor manufacturing and further solidifies our long-standing relationship with this central bank customer” he added.

SPSY Daily Candle Chart

SPSY Daily Candle Chart

Keywords confident that FY performance will be ‘in-line with expectations’

Keywords Studios (KWS) released a trading statement to accompany its Capital Markets Event last week.

The gaming company told investors that has made a positive start to the year with strong organic revenue growth in the first four months.

Keywords said it was confident that the performance for the full year will be “in line with current expectations” and that the company remains well-funded to deliver on its organic growth and acquisition strategy.

Alongside the trading statement, Keywords also announced the acquisition of Forgotten Empires for $32.5m.

Forgotten Empires is a team of game developers and generated revenue of US$7.2m in 2021 and is expected to grow strongly in the current year.

KWS Daily Candle Chart

KWS Daily Candle Chart

Xpediator says it continues to trade well despite headwinds from Ukraine war

In an AGM statement released last week, Xpediator (XPD) said it has “continued to trade well despite the effect of Russia’s invasion of Ukraine, the impact from which, to date, has been largely offset with increased volumes in other markets”.

The freight management company anticipates a stronger second half of the year and is “encouraged by the potential for further growth within the business”…

“There are clear organic opportunities to improve the underlying performance of the UK business” the statement added.

Despite Xpediator’s positive statement, the market remains highly cautious and the shares have continued to under-perform.

The shares are attractively priced relative to forecast earnings per share (EPS) growth north of 70%, and with this in mind, we remain happy to hold them in our AIM Investor portfolio.

XPD Daily Candle Chart

XPD Daily Candle Chart

iEnergizer launch formal sale process

Our latest addition to the AIM Investor portfolio, iEnergizer (IBPO) announced this week that it had begun a formal sale process after receiving private equity takeover interest…

Last Friday, it emerged that iEnergizer had received an approach from Baring Private Equity Asia and was conducting a strategic review.

iEnergizer plans to review potential buyers who will enable the company to prosper long-term while maximizing value for all stakeholders, according to the statement.

Anil Aggarwal, the firm’s founder and CEO is the controlling shareholder, and in the short-term, there doesn’t appear to be much downside to shareholders.

However, we will continue to monitor the situation closely with a view to conducting a review should a new management team be put in place.

IBPO Daily Candle Chart

IBPO Daily Candle Chart


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