Buy Hold Sell

After a brutal ‘confession season’, the small cap market is  littered with former market darlings now trading more than 30% off their recent highs. So in this  episode of Buy Hold Sell, two small cap specialists, Simon Shields from Monash Investors and Dean Fergie from Cyan Investment Management,  talk us through five of these ‘fallen angels’. Which of them are now offering value … and which of them have further yet to fall?

Key points:

  • Yowie: Down 30.2% in 12 months. Product selling well with high margins, volumes have potential to grow at close to 100% p.a.  However, questions over their sales matching their store presence, and also recent management changes.
  • Vocus: Down 47.6% in 12 months. Is it becoming a retailer of NBN product? Trading on a reasonable multiple, but looks ex-growth.
  • iSentia: Down 56.6% in 12 months. Barriers of entry coming down, and increasing competition. An example of investors getting burned from private equity sell-down? 
  • Capitol Health: Down 84% in 24 months.  High barriers to entry, raised capital to sell down debt, new management.
  • Catapult: Down 37% in 9 months. Wearable technology, sticky customers, good pricing power, big market.

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Disclaimer: The information contained in this presentation is general in nature and should not be relied upon. Before making any investment or planning decisions, you should consult a licensed professional who can advise you whether your decision is appropriate for you. Contributors to this show may have commercial or financial interests in the companies mentioned.