Should You Buy Cap-XX Limited, Sinclair Pharma PLC And Manx Telecom PLC After Today’s Results?

Do Cap-XX Limited (LON: CPX), Sinclair Pharma PLC (LON: SPH) and Manx Telecom PLC (LON: MANX) offer great bargains?

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

Every heard of CAP-XX (LSE: CPX)? It’s a small Australia-based company, with a market cap of around £13m before today’s interim results, and it makes thin, flat supercapacitors. If you don’t know what they are, they’re key components in the power supplies of portable computing devices, so there’s a pretty big market for them.

But the shares took a tumble today, dropping 18% by the time of writing, to 4.05p, caused by a 27% fall in revenue for the six months to December 2015. That was, we were told, due to the deferment of some orders combined with increasing project lead time. The deferments were known in October, so might the price fall be a bit of an over-reaction?

Well, there was an increased net loss, of A$1.3m, and the firm reported cash reserves of just A$0.9m — although a new patent licence agreed after the end of the period should bring CAP-XX an up-front payment of at least A$2.4m. There are no forecasts for profits yet — in fact, there are no forecasts at all —  so it’s hard to quantify. A big risk or a company with great potential? Possibly both.

Pretty skin

We also had interim results from Sinclair Pharma (LSE: SPH) today. They were greeted with a little more enthusiasm and the share price gained 3.4% to 34.6p as a result. Sinclair, which specialises in aesthetic dermatology (skin lifiting, collagen stimulation, and things like that), reported a loss of £14.1m for the period, up from £10.7m, with a 2.8p loss per share compared to 2.1p a year previously.

That came from an expected fall in sales to £7.7m, from £10.5m, attributed to “planned distributor de-stocking“. But the third quarter is expected to bring revenue in excess of £8m, and along with an amendment to the payment terms for Sinclair’s acquisition of AQTIS Medical BV, that pleased the markets. The disposal of Sinclair’s non-aesthetics brought in £132m, enabling it to clear all debt and leaving net cash of £75.4m at 31 December.

With losses expected to continue for at least the next two years, making any valuation of the company pretty difficult, it’s a big risk — but it could be one worth taking.

A great start

Since flotation in February 2014, shares in Manx Telecom (LSE: MANX) have put on 34% to reach 215p. And on top of that, the company paid out a 5.6% dividend for 2014, and has just announced a 5% rise in its 2015 dividend to 10.4p — yielding 4.8% on today’s elevated share price.

Revenues were pretty flat for the year, but underlying pre-tax profit gained 27.9% with underlying EPS up 19.4%, and the company recorded strong operational cash flow of £25.4m. How does it do so well? Having a monopoly on fixed-line communications in the Isle of Man certainly helps (and the firm has just renewed its government contract for another five years), and it also has about three quarters of the island’s mobile business.

With 4G rollouts continuing (after helping boost mobile revenues by 9.3% in 2015), forecasts suggest more of the same over the next couple of years, with the firm’s progressive dividend policy set to boost the annual cash handout by 5% per year.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Alan Oscroft has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Investing Articles

It’s up 70%, but the experts expect the IAG share price to climb still further

Why didn't I buy when I was convinced the IAG share price was likely to soar? And is there still…

Read more »

Businessman use electronic pen writing rising colorful graph from 2023 to 2024 year of business planning and stock investment growth concept.
Investing Articles

2 UK stocks with recovering profit margins

This writer considers a pair of UK stocks with very different share price trajectories following the pandemic. Would he buy…

Read more »

The flag of the United States of America flying in front of the Capitol building
Investing Articles

Will Trump’s tariffs squeeze this FTSE 100 giant’s profits?

Our writer looks at how the latest news around US tariffs might impact FTSE 100 company Diageo. Should he be…

Read more »

Investing Articles

Up 95%, is this FTSE winner the best high-yield star for me to buy now?

Do we have to choose between share price growth and high-yield dividends? In this case, over the past year, it…

Read more »

Asian Indian male white collar worker on wheelchair having video conference with his business partners
Investing Articles

2 dividend-paying FTSE shares that could benefit from the AI revolution

Our writer examines two dividend-paying FTSE shares and explains some of the opportunities and risks he sees in their exposure…

Read more »

Investing Articles

Up 140% and rocketing out of the FTSE 250! Is it too late for me to buy this red-hot stock?

Miniature war games hero Games Workshop has outgrown the FTSE 250 and is hammering at the door of the UK's…

Read more »

Investing Articles

If I invest £10,000 in Taylor Wimpey shares, how much passive income will I receive?

Taylor Wimpey shares have fallen and are now paying a huge dividend. How much might I receive by investing a…

Read more »

Index Funds text carved in stone background
Investing Articles

Why I choose to invest in individual stocks rather than an index fund

Our writer examines the differences between stock picking and investing in index funds and why he feels there’s more to…

Read more »