Despite being relatively unheard of the IVE Group’s (ASX: IGL) activities touch virtually every household in Australia, every week of the year. This printing company has transformed itself into an integrated marketing, print and communications service provider to a large and diverse range of blue chip Australian and global companies... Show More
Consumer electronics is an exciting category for consumers to shop. With the pace of change in the category, the lifespans of mobile phones, TV’s, headphones and computers is shrinking considerably, making our visits to electronic retailers increase from once every couple of years, to every year, or even several times... Show More
Hi Art, there are a number of point that need to be taken into consideration, they are: - Ive group is a small cap stock and so off the radar of larger institutional investors. - Liquidity for many investors is an issue, particularly in this market environment. - Furthermore, investors in the small cap space are typically focused on more exciting growth stories to meet their investment objectives, whereas IGL is a steady dividend payer. - Ive group is a large player in the print industry which many regard as being a sunset industry, and hence apply limited valuation multiples to. - Print volumes have been declining as the world moves to digital. IVE is participating in that transition, offering digital services, however is exposed to a significant step change in that trend. - The industry has been plagued with excess capacity in recent years, limiting margin progression and pricing ability, although consolidation is improving the industry structure. - Paper is clearly a significant input, and rising paper prices did have a short term impact on margins towards the end of the last financial year. Management appear to have the situation under control now, however it remains a medium term risk to profitability. - Integration risk – management have made a number of large acquisitions in recent years, which always brings integration risk. Integration is almost fully complete now. - Management have invested a significant amount of capital in new production capability, and so the onus is now to generate a return on that investment. I hope that helps add some clarity!