My 2007 top stock pick is IIR (Independent International Investment Research plc)

Website: www.iirgroup.com
Share price: 20p
Capitalisation: 5.2 m
Year end: 28 Feb 2007

Overview

Independent International Investment Research (IIR) provides research on
global companies and currencies, for broker-dealers, investment banks, money managers and private clients.
The equity research business comprises wholly owned subsidiary Independent Financial Markets Research Ltd. (IFMR). The India-based (Chennai and Mumbai) equity research team now covers 300 companies, of primarily non-US with American Depositary Receipt programs.IFMR, established in 2002, has benefited from the 2003 Global ResearchAnalyst Settlement (GRAS) in the US, which required broker-dealers to provide independent research to retail clients.

Supplementing the equity research business, Pronet Analytics.com Limited
(Regulated and Authorised by the FSA in the UK and registered as an
Investment Advisor with the SEC in the US) offers investment advice and trading strategies to clients such as Standard Chartered and Citigroup. The ability to combine currency forecasts with the Group's fundamental equity research also offers an attractive product differentiator and has helped improve the performance of recommendations for US$-based investors in overseas stocks.


Insinger initiated coverage in September 2006 after the company finally turned a corner and became profitable with the new business model starting to bear fruit. The report provides a detailed background of the company & the new business model [far better than I could hope to write myself].

http://www.iirgroup.com/iir/docs/Insinger_research_note_Sep_2006.pdf

The forecasts were very conservative as you would expect at such an early stage of the companies turn around in fortunes, these forecasts have since been easily surpassed & a trading update was issued on the 20th Dec ;

http://www.iirgroup.com/iir/docs/Trading_update_11_December_2006_v1.7.pdf

Followed closely by an upgrade in forecast from Insinger showing a substantial increase of 261% in EPS forecasts ;

http://www.iirgroup.com/iir/docs/06-12-2-IIR.pdf

At the time this meant the company was trading on an 83% discount to research-oriented peers and as such has risen to today's price of 20p per share [was 13.5p when picked]. This is still very cheap and only puts IIR on a PE of 8 despite their exceptional growth - versus an industry average of 20 25.

Whilst the company does not have a history of earnings performance it is worth bearing in mind that the Insinger forecast only includes CONTRACTED business and does not take into account conversion of the strong existing pipeline or any new pipeline as the year progresses [see comments in trading statement + confirmed by CEO] Additionally any potential revenues from new product developments & other medium term growth drivers [see Insinger initial coverage & last finals] are excluded.

Furthermore the company is looking to break into new areas where independent research is beginning to take hold, in particular SE Asia & the UK. Market commentary is very positive for growth of the indies into these areas. A very useful source of industry specific information is;

http://integrresearch.blogdrive.com

To assist their major expansion plans they are currently strengthening the management team and looking to increase the research analyst heads in their Indian subsidiary from the current 60 to 200 staff during the .

As well as organic growth, earnings accretive acquisitions in the research space will be considered - Any acquisition would be paper based,

The current CFO for example is PT and cannot give any more time so a replacement is being sought, [any of you looking for an interesting role?] Details of which I attach as it gives an insight into where the company is heading in 2007;

http://jobs.efinancialcareers.co.uk/job-4000000000223293.htm

To conclude

+ Current PE is 8 versus industry average of 20 25.

+ Current EPS forecast is ultra conservative as based on contracted business alone, excluding the pipeline and likely additional business wins + growth into new areas.

+ Management & research team being strengthened to take advantage of the pipeline of deals.

+ Mr Smith CEO is planning a number of investor relations exercises [Insinger coverage was the start of this] early this year which is hoped will see the company more appropriately valued by the market.

+ Has very little debt, the company has been supported financially by Mr Smith & his trust over the last 2 years.

+ Significant taxable losses to utilise

+ Potentially a bonus of a multi million settlement from Google for Gmail trademark claim - talks are discussing after previous offer by Google was rejected.

- Liquidity is poor but will hopefully be addressed in some way as part of the investor relations drive and paper being issued for earnings accretive acquisitions.

http://www.iirgroup.com/products/GER/researchuniverse

hope so jdubb,we seem to have been waiting a long time.

very quiet,next to no trades for almost a week ,would have hoped for a bit of buying before tu,

Trouble is everyone who has this on their radar already hold!!
Hope they dont disappoint us and give a TU like IGE today!!

thats my worry jdubb,their has been too many small caps giveing profit warnings of late,

I think alot that held previously have sold & moved on, something has to account for all the sales of late. Coverage at 344 indicates we are still growing imo so fairly relaxed that the previous guidance for this year will be met.

Soon find out I guess, you 2 going to the AGM ?

Didn't someone post on here [copshaw ??] we expect to be busier in volitile markets ? If so any chance of some mre meat on the bone.

yes that is what shane said ,they were busier in a voitile market,those were his words,just frettin a bit as its been a bit doom and gloom of late.

Thanks copshaw, did he give any reason why ? Maybe just a rush for a safer haven - fundamentals - in a volitile market ?

just said that companies used their experteise in a more volitile market,its a while since i spoke so cant remember all the conversation.

Ta.

Someone said results out tomorrow on ADVFN, not sure how reliable that is tho! Hopefully wont be any nasty suprises! Time for a bit of action me thinks.

Were on the move at last! Not very reliable was it! Looks like results out nxt week then!

jdubb,when i had a word with them they said it might be a tall order to get them out buy the middle of the month so i would hope for end of next week.still good to see this rise,just hope their is no nasty surprises hidden away in the results,personaly i thought the last trading update was very good but the weakness in the dollar knocked us back.

jdubb,when i had a word with them they said it might be a tall order to get them out buy the middle of the month so i would hope for end of next week.still good to see this rise,just hope their is no nasty surprises hidden away in the results,personaly i thought the last trading update was very good but the weakness in the dollar knocked us back.

google would have paid by now ..... they are not going to give iir any big amount

opshaw - 21 Sep 2007 09:23 - 196 of 197


just hope their is no nasty surprises hidden away in the results
why do you say that .copshaw

you can never be 100% sure that it will be all good news,iir will get a huge sum when they settle the google case.

Sod the bloody google case, the business model is where the money is at. Look at the margins & operational gearing - Once these scale up they will be printing cash imo.

The 1H only finished end of August - you ever known a company to rush out bad news ? I certainly havn't.

I wish you would make up your mind thinkbig as you are doing my bloody head in - last night you were saying you couldn't get an order filled - day before that it would fall on results.

6 weeks ago you couldn't get a 50k order filled then 2 weeks later questioned if the company might go bust [despite being cashflow positive with no debt].

Why would google have paid by now ? they are using the GMail name in the US - it is us that has applied for it to be cancelled so they arn't just going to write a cheque without even defending the cancellation petition. According to BBC they offered several million way back when it all started but the amount was nowhere near the independent valuation.

dream on copshaw about google
what happened to iirs case in usa than???????????

Use the USPTO website & go find out, was enough discussion on the matter from the other thread you frequently post on.