Daily Grime - IPX/FCAP

Daily Grime - IPX/FCAP

Jeremy Grime  | Oct 08, 2019 08:59


  • Hong Kong Exchange and Clearing Ltd (HK:0388) abandons its bid for London Stock Exchange Group PLC (LON:LSE), due to lack of engagement.
    • REFS, that many of us were fed in our early years in the high chair of the investment world have been bought by Slater and Stockopedia.

  • EY reports the quietest quarter for IPO’s in a decade
    • Non-Standard Finance (LON:NSF) appoints Panmure as Joint Broker alongside Shore Capital

    Impax Asset Management Group Plc (LON:IPX) – AUM Update

    Share Price 246p

    Mkt Cap £321m

    Conflict Disclosure: No Holding

  • Update Net Inflows of 1.6% combined with 1.9% help from the market to increase AUM to £15.05bn over the quarter to September. For the full year AUM is now up 20%.
  • Estimates Forecasts anticipate £17.5m PBT for the year to September and a further 21% growth in the year ahead to £21.1m, EPS 12.7p which look reasonable in the light of 20% AUM growth.
  • Valuation PER 19.4X the year ahead and yield 2%. EV/AUM 2%
  • Conclusion The shares are cheap on an EV/AUM basis and expensive on a PER basis by virtue of the low operating margins the company achieves. Better operational gearing to the environmental theme can be obtained at Liontrust where the PER is 13.4X.
  • finnCap Group (LON:FCAP) – Trading Update

    Share Price 25p

    Mkt Cap £43m

    Conflict Disclosure: No Holding

  • Update Revenue for the 6 months to 30 September expected to be £14.2m and PBT £1.3m. The statement says 12 new corporate clients have been won, 8 sale mandates completed and 17 new sell side mandates have been won, as well as a debt mandate.
  • Estimates None. Revenue in the year to March 2019 was £25m and PBT £3.2m.
  • Valuation The NAV is £20.6m and if the company can do, say £3m PBT that would equate to a 12% ROE. It trades at 2.1X book value. PER using adjusted EPS last year is 8.8X, but adjusted EPS excludes share based payments and includes a nominal tax charge. Numis trades at 9.6X and yields 5.6%, or 1.6X NAV.
  • Conclusion Given current markets this is respectable. But it may take a while for the company to grow into the valuation given profits look likely to decline this year. The graph of brokers revenues below may help with perspective

    Jeremy Grime

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