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Dowgate Capital - Capitalising on the booming AIM market (DGT)
overgrowth
- 09 Feb 2005 20:52
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Dowgate Capital (DGT) are sitting in the middle of a goldmine! This company through their sole trading arm City Financial Associates are looking to take full advantage of the "booming" AIM market this year. Dowgate provide NOMAD (NOMinated ADvisor) services to AIM companies and also have full Corporate Broker status which means that they can fund placements on behalf of the companies they represent. |
 Website: www.cityfin.co.uk |
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On first sight, the fact that Dowgate exist in the often veiled financial services sector makes you think twice about investing in company such as this because it would be impossible to understand what they were doing - however, think again! DGT bring new companies to the AIM (Alternative Investment Market). For each new company "floated" on AIM, they take arrangement fees when acting as NOMAD. After the company is launched then for a nice steady earner DGT get another healthy chunk of cash every year for looking after them (note that all AIM companies must have a nominated adviser - thereby securing a ready source of recurring income). Because DGT also act as a Corporate broker they can get a very healthy percentage for arranging placement of shares with insititutions before a new company floats. In addition, because placements come outside the sphere of yearly NOMAD work, they can also gain healthy percentages of placements which companies may need to make throughout the year when they need a quick injection of cash to speed growth. Current NOMADships: 28 companies represented (gives recurring income of approx 480,000 per year) Current on-going Brokerage agreements: 19 companies (income depends on placements) For flotations, depending on the size of a company, fees charged will be anything from 50,000 to 100,000+ For placements (the real earner), DGT get anything from 3% to around 12% of the TOTAL AMOUNT RAISED - For example a new company raising 3M though a placement will earn DGT anything from 90,000 to 360,000 ! These figures are indicative as actual deals all differ due to circumstances and DGT sometimes take payment in shares - they still have a tasty chunk of Setstone shares and when this Russian exploration company comes back to AIM, predictions are that the share price will rocket. Note that the amount that this little company can earn in fees is huge and every new deal that comes through we know will contribute another healthy chunk into the bottom line. The good news with every new floatation means that it's another chunk of recurring revenue which could go on for years, with DGT having to do very little. New clients gained in 2005 are: Mediazest (NOMAD & broker) Elite Strategies (NOMAD) Process Handling (NOMAD) Poland Investment Fund (NOMAD) Nanotech Energy (NOMAD & broker) Archimedia Ventures (NOMAD & broker) Red Leopard Holdings (NOMAD) Alba Mineral Resources (NOMAD & broker) Intandem Films (NOMAD & broker) Motive Television (NOMAD) IncaGold (NOMAD) Sportswinbet (NOMAD & Broker) Infoscreen Networks (NOMAD & Broker) Mark Kingsley (NOMAD & Broker) Croatia Ventures (NOMAD & Broker) Pantheon Leisure (NOMAD) Firenze Ventures (Ofex Advisor) FlightStore Group (NOMAD & Broker) Euro Capital Projects (NOMAD) Pearl Street Holdings (NOMAD) Worldwide Natural Resources (Ofex Advisor) Dovedale Ventures (Ofex Advisor) Other 2005 work completed:Neptune-Calculus VCT offer for subs of up to 12 million Advisory work for TGM on London Bus disposal for 20.4M Advisory work for Creightons on property disposal Advisory work for Hampton Trust on company restructuring Advisory work for Interbulk Investments on acquisition of Inbulk Advisory work for Fundamental-e Investments on two disposals Advisory work for Designer Vision re: Design Rights against Centurion Electronics Click Here for fundamentals and profit projections. |
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stockdog
- 09 Jul 2005 16:55
- 1097 of 2787
At 1/1/05 they had 495k cash on the BS. Add to that 1,031k net profit (my latest estimate) before/after tax (assume new fixed asets purchased = approx. depreciation charge for year = cash neutral) you get 1,526k cash at 31/12/05.
At .73 mid SP with 619m shares in issue, less 1,526k cash, you get enterprise value of 2,992,700. This gives a 2005 enterprise PE of 2.90!!!!!! . . . or what, I should say.
I have previously speculated what they will do with their growing cash hillock (not quite a mountain yet!). My guess is it will lead to a purchase of a small but perfectly formed broking division, as per their declared aim to expand back into this area.
The only mildest of nerves I have is TR's reticence (how else could it be?) on any but the most confirmed of news. So news of prospective new deals/clients are all but completely absent until done. I have recently been watching the regular stream of IPO's announced by the LSE and have looked in vain for those involving DGT as NOMAD and/or Broker. The assumption that they can perform in H2 nearly as well as in H1 is a natural assumption, but far from proven in a market possibly about to revert to the bear strengths of a couple of years ago.
Roll on late August for H1 results to give the SP a lift to 1p+. Roll on much more so news of new transactions for H2 to take us to the next level.
BTW, I vote blue for Monday.
sd
carchase - 10 Jul 2005 13:51 - 1098 of 2787
DGT prior to the London Bombing was on the verge, of bigger moves. All the indicators, MACD, RSI, bollingers, stocastics, etc, were in DGT's favour. Thursday however turned events on their head. DGT ran out of buyers, and they only really came back in by the end of the day, once things were a little more stable. Once again DGT proved there are very few sellers out there. Some panicked from the word go, but never really materialised for the rest of the day. Friday was simply no one willing to take the lead. Neither buyers or sellers willing to show their cards. The good thing is, that all the gain of Wednesday has not been lost over the last two sessions. We are still holding on to them. This is where Monday really has to hold on to what we have. Its going to take some constant buying, or news to shift it on to above 0.75p, especially as we do not know how events in Birmingham will effect the markets as they open. There is no denying these events will effect proceedings. The TA does still support a rise, but without a positive Monday that will begin to level out. Its not an easy one to call right now. If I have to be precise I would say that if we can remain above 0.65p till the close of Wednesday it will show potential buyers this is not going down so easily. Time to assess the next step.
My only concern is that if the TA indicators begin to cool off by Wednesday, then any subsequent rise will be delayed as confidence needs to be built again. Most of us though are going nowhere anyway, and may use this rest as a time to buy more.
DGT managed to test the high of late June, and through no fault of its own this week, was stopped from pushing on. I am convinced that there is a 'snap' underlying move on the cards with DGT building up. This means that many who wanted to buy will be caught cold. Its has, for some time been boiling under the surface. The standard consensus is the next set of results will finally deliver. If so, these sub 1p prices could be taken out without warning. In those cases its worth watching the size, and timing of trades. The more constant the more the clues are there.
I am sorry that the post is not more precise to movement for the following days, but in a world of uncertainties, we do the best we can. Its like trying to walk through a minefield right now, with events out of our control. To hold anything above 0.65p in the first instance will be good. To push on any higher at this stage will be a bonus.
PS, I do read this BB but very rarely post. I think if anyone wanted to read opinions on DGT in peace this would be a good start. Its a credit to some of the posters on here, that this BB is worth reading.
stockdog
- 10 Jul 2005 14:14
- 1099 of 2787
Have been reading your TA posts on iii - not understanding how you arrive at your opinions, since I am very limited in my own TA development, but happy to see you are broadly as positive as most of us are.
What's a good book (simple overview, please) to start learning more about MACD, RSI and Stocastics, IYO?
sd
ptholden
- 10 Jul 2005 15:00
- 1100 of 2787
Nice to see you posting over here. Fully concur with your underlying 'snap' theory, I think the 'snap' may susprise a few, but then I have always thought that this stock will catch people out before the Interims.
sd
sorry to butt in on your question to carchase, but try Technical Analysis of the Financial Markets by John J Murphy.
Een has some of those triangular type thingies for you to digest, plus a host of other stuff with easily understood text and illustrations (well, it would have to be for me to understand it!)
pth
carchase - 10 Jul 2005 15:33 - 1101 of 2787
Stockdog as Pth has just said a good book would be John J Murphy's. It practically cover every area, and in simple plain terms. Another book would be Chart Analysis by Brian J Millard. The rest is really picked up with experience as you go along. Some very good websites out there, but none that I can recommend over any other.
Normally I want to keep posts on TA as simple as possible, simply because to go into depth will throw people.
stockdog
- 10 Jul 2005 20:11
- 1102 of 2787
Edit: Thought the name Brian Millard sounded familiar - in another life time I read his book on Traded Options which I used to dabble in.
sd
EWRobson
- 11 Jul 2005 11:36
- 1103 of 2787
peter, one birthday rpesent from son is trip to st Andrews for Sunday - see you there?
Eric
corehard - 11 Jul 2005 16:01 - 1104 of 2787
corehard - 11 Jul 2005 16:01 - 1105 of 2787
stockdog
- 11 Jul 2005 16:30
- 1106 of 2787
overgrowth
- 11 Jul 2005 16:49
- 1107 of 2787
It's handy to see the price moves during the day at a glance, particularly if you're looking to buy or sell.
stockdog
- 11 Jul 2005 16:54
- 1108 of 2787
markusantonius
- 11 Jul 2005 17:49
- 1109 of 2787
Peter won't be home yet - prob still smarting en route from the club after wiltering in the mid-Summer sun to a Shark Attack. With a 7 handicap allowance on our Medal, PTH was 13 strokes up (incl. h'cap) with 11 holes remaining playing some Tiger-like golf until a Shark Attack took the money and cleaned up on nearest-the-pins and - wait for it - longest drive - to win by 4 clear shots!!!!
BTW does "x0" = 50 or 60, sir, just curious? More like 30 the way you managed to beat the field round 36 holes of golf, last month!!
Well DGT are still hanging in there, I see!
ptholden
- 11 Jul 2005 18:32
- 1110 of 2787
More work on the way from Voss I would hazard. There were rumours in the national press last week that Voss were on the verge of an acquisition, up 20% today on no news. Possibly a leak? Expect confirmation soon.
Eric, can't knock a guy for taking a profit. Don't forget my commision!!
pth
corehard - 12 Jul 2005 10:35 - 1111 of 2787
ptholden
- 12 Jul 2005 21:15
- 1112 of 2787
pth
ptholden
- 13 Jul 2005 23:45
- 1113 of 2787
I have studied DGT and watched the SP movements quite closely over a period of 2 years and something at the moment is not quite striking a chord. Generally any sells of a small cap such as DGT tend to move the price more or less immediately down and sustained buying will move it up. This is not happening with DGT at the moment. Over the last week or so, sells have not moved the price down, nor have the buys had any great affect. Tie this into the fact that the MMs are just not interested in selling PIs stock (you could only buy relatively small quantities on line, 100k for most of today) in other words actively discouraging buyers..
One possible scenario is that the MMs are filling a big order at an agreed price and are are hanging onto whatever stock is sold for this purpose. They can't move the SP up because then they would have to buy outside of the set limit and lose money. They know if they drop the price, they will be over run by PIs snapping up cheap stock. and be no further on towards filling the order.
I may be way off the mark, but it does raise an interesting question or two.
Who's buying - private or business?
Are they buying for the profit opportunity on the run up to H1?
Somebody building a stake for whatever reason?
When, if at all will we find out exactly what is going on?
In the final analysis this is all supposition, and helps pass the time, but if there is any truth to this it can only do the SP good.
pth
stockdog
- 14 Jul 2005 00:38
- 1114 of 2787
sd
sidtrix
- 14 Jul 2005 09:15
- 1115 of 2787
Am also in around .45 mark however narrowly missed out topping at .35 & .37 DAMMIT!!!
ptholden
- 14 Jul 2005 09:41
- 1116 of 2787
Don't really think that 0.75p is much of a risk in my opinion, but we shall see.
pth
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