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VRS - Veris Limited

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OTOC Limited (OTC) was formerly known as Emerson Stewart Group Limited (ESW).
 
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Re: OTC - OTOC Limited

Interesting stock that looks very cheap based on the cash flow report (22/1).

Anybody following this one?

Cash flow does look really good now, but without seeing the full accounts - its hard to determine how much is just cash in advance??
Despite the parabolic surge this still looks very cheaaaaap!!
 

skc

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Re: OTC - OTOC Limited

Interesting stock that looks very cheap based on the cash flow report (22/1).

Anybody following this one?

Cash flow does look really good now, but without seeing the full accounts - its hard to determine how much is just cash in advance??
Despite the parabolic surge this still looks very cheaaaaap!!
Yup. Holding some from 7.5c or so. I am sure it is wrong to take 4x qtrly cashflow and call it the year, and i await the full report to decide what to do with the holding. But like you said, it's cheap enough so the report doesn't need to knock the ball out of the park.

But the market was in a buy first, ask later mood when the qtrly came out and it would be silly not to take a position despite the unknowns.
 
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Re: OTC - OTOC Limited

Yup. Holding some from 7.5c or so. I am sure it is wrong to take 4x qtrly cashflow and call it the year, and i await the full report to decide what to do with the holding. But like you said, it's cheap enough so the report doesn't need to knock the ball out of the park.

But the market was in a buy first, ask later mood when the qtrly came out and it would be silly not to take a position despite the unknowns.
Agree here, looking forward to the report!
 
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Re: OTC - OTOC Limited

Interesting stock that looks very cheap based on the cash flow report (22/1).

Anybody following this one?

Cash flow does look really good now, but without seeing the full accounts - its hard to determine how much is just cash in advance??
Despite the parabolic surge this still looks very cheaaaaap!!
Interesting I love these sort of microcaps.

But looking at Sep 12 quarterly cash flow it looks the same but with a minus sign in front of the $4m... The explanation was due to timing of receipts from customers. Maybe they all just came in?
 
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Re: OTC - OTOC Limited

Report out after the close today.

Complicated report, interesting to see what others make of it..

Obviously normalised NPAT is solidly up....but work in progress is down - causing assets to be substantially down.
Revenue is down, but margins have improved....

Im not sure if the commentary is honest, or just marketing to fit how the numbers appear...either way tomorrow the market will voice its almighty opinion!
 

skc

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Re: OTC - OTOC Limited

Report out after the close today.

Complicated report, interesting to see what others make of it..

Obviously normalised NPAT is solidly up....but work in progress is down - causing assets to be substantially down.
Revenue is down, but margins have improved....

Im not sure if the commentary is honest, or just marketing to fit how the numbers appear...either way tomorrow the market will voice its almighty opinion!
The gross profit margin improvement (from 9.65% to 17.9% despite lower revenue) and the cash flow (+$6.3m for a $20m company) were the highlights. This time last year they have plenty of work but couldn't make any money. Now they seem to make decent money but not doing enough work...

H2 forecast is $80m in revenue so if they make say 14% gross margin (mid point between the two periods, it was 13% in FY12) and keep the same overhead expenses, H2 NPAT can be $2-$2.5m. And that's not bad on a normalised basis relative to the market cap.

So the result is a hold for me. It would be a buy if it was 2010 without the threat of significant sector slowdown. But OTC is such a small fish they only need 2 tiny contracts (relatively speaking) to fill their revenue goals.
 

skc

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Re: OTC - OTOC Limited

So the result is a hold for me. It would be a buy if it was 2010 without the threat of significant sector slowdown. But OTC is such a small fish they only need 2 tiny contracts (relatively speaking) to fill their revenue goals.
Changed my mind and sold out. The result is still a hold, but the sector is a sell and the lack of liquidity means that, if something goes wrong it'd be quite ugly.

While I don't doubt it is possible for them to achieve the FY figures I've outlined, I have no way of knowing the probability of such... So my risk manager (i.e. me) says sell...
 
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Re: OTC - OTOC Limited

BLY which seems to be the canary for this sector had a bit of an off the perch day today too.
 

skc

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Re: OTC - OTOC Limited

BLY which seems to be the canary for this sector had a bit of an off the perch day today too.
Negative comments from Major Drilling, their key global peer / competitor.
 

skc

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Re: OTC - OTOC Limited

Thanks SKC timely insight!
Not much insight. Just email alert from some analyst. Managed to take a good short trade on ASL on the back of that... 15 ticks but position was too small.
 
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Re: OTC - OTOC Limited

Not much insight. Just email alert from some analyst. Managed to take a good short trade on ASL on the back of that... 15 ticks but position was too small.
I hadn't connected the BLY and MJDLF dots. Helps with a bit of insight into what BLY etc might do next after the night before.
Glad you nailed ASL, was tempted, from the BLY action but took to biting my fingernails instead.

This sector is just bonkers at the moment. BLY looking for the rare triple bottom or doom!?
I'm always nervous about going for a third tilt on the long, can be a bit of a ball breaker!
But I don't think the mining boom is over, so will be hovering.

There are just too many populist printing and infrastructure parties raging on and on and on.
 
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Re: OTC - OTOC Limited

I hadn't connected the BLY and MJDLF dots. Helps with a bit of insight into what BLY etc might do next after the night before.
Glad you nailed ASL, was tempted, from the BLY action but took to biting my fingernails instead.

This sector is just bonkers at the moment. BLY looking for the rare triple bottom or doom!?
I'm always nervous about going for a third tilt on the long, can be a bit of a ball breaker!
But I don't think the mining boom is over, so will be hovering.

There are just too many populist printing and infrastructure parties raging on and on and on.
The problem with the mining boom is the scale of the boom – it does just not come to a stop straight away, it could take decades to slow down. The switch in media outlook over the last couple of years makes me think there is a real opportunity here – nobody is going to be able to accurately predict the future of such a complex situation as mining and China. Mining services companies were trading too cheap. I agree there might be consolidation within the industry, and I agree that margins might get squeezed for a few years, but to say it is all over is ridiculous. I am enjoying this sector at the moment, taken some profits, and will be keeping an eye on BLY, ASL….long may the volatility continue.
 

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Re: OTC - OTOC Limited

The problem with the mining boom is the scale of the boom – it does just not come to a stop straight away, it could take decades to slow down. The switch in media outlook over the last couple of years makes me think there is a real opportunity here – nobody is going to be able to accurately predict the future of such a complex situation as mining and China. Mining services companies were trading too cheap. I agree there might be consolidation within the industry, and I agree that margins might get squeezed for a few years, but to say it is all over is ridiculous. I am enjoying this sector at the moment, taken some profits, and will be keeping an eye on BLY, ASL….long may the volatility continue.
Mining boom isn't over, it is moderating. But mining services margin boom is definitely over.

The cost is too high in Australia making investments uncompetitive. To make projects economically viable, you either need skyhigh (yet stable) commodity prices, or squeeze the builders to do them cheaper.
 
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Re: OTC - OTOC Limited

Mining boom isn't over, it is moderating. But mining services margin boom is definitely over.

The cost is too high in Australia making investments uncompetitive. To make projects economically viable, you either need skyhigh (yet stable) commodity prices, or squeeze the builders to do them cheaper.
And a lower AU$
 
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Re: OTC - OTOC Limited

Mining boom isn't over, it is moderating. But mining services margin boom is definitely over.

The cost is too high in Australia making investments uncompetitive. To make projects economically viable, you either need skyhigh (yet stable) commodity prices, or squeeze the builders to do them cheaper.
IMO - the mining services sector is the game for 2013. I intend to play the game all year.
 

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Re: OTC - OTOC Limited

This one popped into my companies of interest recently, wary of roll-ups, but still quite interesting. Anyone else looked at it lately?
 
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