Welcome, this publication is an interactive weekly update on what’s happening with the trending stocks this week. I highlight and comment on the stocks that you want me to highlight or comment on. The more you speak the more I share! I also provide a round up of Share Talk’s interviews over the week. If you think that a certain share or person should be mentioned in the next edition, let me know, my details are at the bottom of the page…
Last week’s Steve Shares was well followed with the main comments based around Andalas Energy and Power. A lot of frustrated people have left their holding there over the last year in the hope of the company providing a return opportunity, but with most having averaged down to try and make further gains, recent news has left a very bitter taste. The general consensus was that they would never see any returns of the money they put in at the beginning of last year.
The second bout of enthusiasm of a negative nature was aimed squarely at CGNR or to be more precise, the management. Some things I cannot repeat nor wish to hear again, however I shall summarise with “The impossible they could do straight away, miracles may take longer”. Those close to me know I hate to see any company put out negative news flow or none at all, so as always, I wish holders well, but it may be a wish too far for those two. Thank you for your comments and thoughts.
This week I covered Westminster Group Plc (WSG) and Frontera Resources (FRR)
The write ups are at the end of this publication as always, but here is the link for the TipTv video on Share Talk: https://www.share-talk.com/tip-tv-stock-watch-steve-larratt-previews-frr-and-wsg/
This weeks stocks…
Please put your seatbelt on and place your lap trays in the upright positions as there maybe turbulence! Well as planes go up it’s been a good return for holders over the past few months with a steady rise in the share price. However what goes up must come down and the company put out a mixed report this week. On the one hand they flew a record number of passengers up to 33.8m in the first six months of the financial year. They also announced they have planned to move their Air Operator Certificates into another EU member state later on this summer. This will secure the flying rights of the 30% of the network that remains wholly within and between EU states. They have however reported a loss before tax of £212m. This was worse than the estimates of £176m and much higher than the £21m last year, again with Easter not falling in the first half this has altered the figures accordingly. With the issues being caused by delays due to security issues currency movements and the price of oil. Although they cut the dividend payment the company is still paying one and could this be just a pocket that they need to fly through? Seems the drop has attracted new investors as the share price bounced back after the initial drops. Thoughts and comments are welcomed as always.
Pembridge Resources (PERE)
On the lips of people on social media is this share. Initially looking at the company several weeks back the main negative was based around a clear direction and funding issues let alone an asset to satisfy the listing requirements. After the name change from China Africa Resources the new direction seems to be quite clearly reported now. The main aim of the business is to identify and develop assets. The main focus is on politically stable country’s, mainly looking towards the smaller less well known assets that might have run into disrepair or bankruptcy. The main aim is to bring any acquired assets into near term production. Aiming at late stage projects if they can be brought cheaply into production that may need funding or something key that is missing from that project looks like a quick turn around. Looking at this business model is a breath of fresh air as compared to the normal exploration type company and should make a fast return on initial outlay. As ever time will tell if the company can deliver. The funding issue is soon to be concluded by the end of the month or so. The only risk is will they get an asset in the near term to satisfy the listing rule. I hope that this takes place for holders, and I hope for no suspensions in the share. Thoughts and comments are welcomed.
Its been a year of downs and now ups, looking into the business it seems like they have an early mover advantage into the market with its social media technology. This has boded well and has also been a custom made platform based on the local area and its customs. Could this be rolled out to other areas in the vicinity such as India? With the previous oppressive state now in the past and the country has recently been through an expansion of growth at government levels and has attracted a doubling of foreign investment in recent years. Could other opportunities present themselves in the region that he business could meet? With the region being mainly as rural as Lincolnshire it is surprising that they are aiming to cover 80% of the country with 3/4G mobile phone signal. However with the population now having access to smart phones the government sees the way forward and is meeting its targets. The company recently announced that Average daily revenues reached USD 5,000 during the first week of May, an increase from an average of 3,900 the month before. The majority of current daily revenue is generated from gaming and mobile payment application development services. Could this growth be meeting an inflection point as they make further inroads into coverage in the area. With other games coming into production at the end of the month there could be potential upside in the pipeline. Your thoughts comments and suggestions are welcomed.
What companies do you consider undervalued and news items that the market has missed…? Let me know and I will announce via the next issue of Steve Shares…
My thought of the week
Summer sun and lots of fun or holidays with your little ones? Easyjet news this week makes you think about all sorts of factors that could determine the price of your summer holidays. Could the cheap foreign holidays be a thing of the past as airlines struggle to make ends meet over a longer period? Or are you willing to pay the price? My thoughts are with the price of oil being historically low and the cost of fuel high still prices can only go up… but where? At the pump or in foreign holidays is the question.
Share Talk round up
Share Talk has presented lots of articles and can be found here https://www.share-talk.com
The Biz Lounge… Taking the stress out of stocks
In his regular weekly video features, Mark Johnson takes a look at his stock of the day and big boss of the day. This week featured Easyjet, Barclays, Scapa Group, Lloyds Banking, and BP.
TipTv Write ups
Westminster group Plc (WSG)
Their mission statement sums Westminster Group Plc up. It sets out to be recognised as a worldwide centre of excellence for the provision of Fire, Safety, Security and Defence products and services. It is a British-based company and the Group’s principal activity is the design, supply, installation, and maintenance of security and defence solutions for the protection of people, buildings, and organisations. The main arm is its Managed Services Division and when looking into the company’s past year the statements are there for all to see. The West African airport operations were reported to see steady growth in embarking passenger numbers as the recovery from the Ebola crisis continues and commented that if the growth pattern continued it could benefit the company’s airport and ferry operations. In Sierra Leone they were looking to create a regional hub for cargo services. Westminster’s aviation sector continued to grow as the contracts secured for airports around the world increased. This year alone they have had multiple contracts for bomb disposal suits, multiple airport equipment contracts for x-ray scanners, walk-through metal detectors at both airports and its ferry terminals. Human presence detection systems, powered robotic manipulators for radiation usage, Hand held explosives detectors and most recently Blast mitigation blinds. This is truly a company that could have the potential to be a one-stop shop for all security services.
The key piece of news investors are waiting on is on its Middle East project and is dubbed to be a major long term airport contract opportunity which is expected to have annual revenues in excess of £35m. Previously they have announced that the negotiations and contract preparations were making good progress. The group had been actively working to prepare the required support structures and infrastructure in order to be able to deliver the project. When that contract is delivered it could make its market cap of around £20million look potentially small. Also, remaining amounts are due to Westminster under an old litigation settlement announced in July 2015 and expectations are that the funds were going to be due in this current financial year.
Frontera Resources (FRR)
Frontera’s strategy is to seek early opportunities in “known areas where there is oil or gas” or more specifically where historic political or economic conditions have caused significant oil and gas plays to be underdeveloped. Frontera’s current activities are focused mainly on the exploration and development of a large area called block 12 based in Georgia. They hold a 100% working interest of an area of approximately 1.3 million acres and close by to eight known oil fields. They have undertaken a lot of field work programs and by processing and interpreting new 2D and 3D seismic data, in conjunction with the reprocessing of historic seismic and well log data, they identified two major geologic plays within the block that contain a potential significant reserve that the Company intends to pursue to commercial production. Independent analysis from Netherland, Sewell & Associates has estimated more than 1 billion barrels of oil in place and as much as 13 TCF of gas in place.
Recent announcements by the company of interest is a debt-restructuring process and is being aimed at raising additional funds or getting in partners to take the company to the next stage of development they stated that they were “Currently progressing discussions with potential industry partners” however they stated that in conjunction with this effort, the Company has designed a work program for the next twelve months. This includes the planned drilling of two wells. So early thoughts are of a joint venture partner there soon to be announced and hopefully a detailed plan going forwards of what and how they will develop the true potential that could exist.
Let me know what should be in next week’s article and I will report on the shares that matter to you…
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