Fusionex International – research

Fusionex International share price (FXI)

I stumbled on this company from the Naked Traders website – he bought 2500 shares a few days a go.
So it might be worth a punt as well – but research needs to be done first…

  1. What’s the company worth (Market Cap)?
    ADVFN quote page – Share price x number of shares
    Looking for £50m to £950m
    £ 73.32m (on the small side but within range)
  2. What are the full year pre-tax profits?
    Full year, preliminary, interim results
    Look to see if the market cap is 15x this at most.
    £28.37 – results from Sept-15 
    However the forecasts for 2016 seem to drop to around £4m??
    Looking into this further there seems to be an issue moving to different channel partners(?) and extending payment periods – impacting cash-flow.
  3. What is the net debt?
    Should not exceed 3x full year pre-tax profits
    Net assets in business
  4. Big spread?
    Anything more than 5% = bad
    4.73% 
  5. Is the share price rising?
    ADVFN yearly charts
    IT’s had a massive fall – due to the trading statement and the market reaction – but it does seem to be on the rise again (maybe a market over reaction?).
  6. Profits rising?
    Full year, preliminary, interim results
    Yes
  7. Dividends rising?
    Full year, preliminary, interim results
    Yes
  8. Is the outlook positive?
    Full year, preliminary, interim results
    Yes
  9. Anything negative happening?
    Cash flow delays
  10. Are markets improving or getting worse?
    Worse
  11. What dividend does it pay and when?
  12. Sector?
    IT Services sector
  13. Next statement due on?
    imminent
  14. Company website good?
    Yes
  15. Any recent director share dealings?
    One director has bough two additional chunks of shares and there was a warning of significant interest in the share.

So the above doesn’t paint a great picture…and to illustrate the fall here’s the last twelve months:-

FXI_chart_image

It’s a big fall from the normal level of support – back to the level it floated at.
Does a good company become bad overnight – certainly NT seems to have seem something in it.

As I’m still learning I’m going to take a position and see if this is an over reaction (I just hope I’m not catching a falling knife).

Peace

G


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