I am sure there must be a thread on this one but my search brought up nothing. So apologies if i have missed it.
CRC Group (Epic CCG) is one of my current favourites. Since a warning last year this company has transformed itself.
The most recent interim pre tax profits were 2 million, after the warning, against a market cap of just under 36 million. So we should be looking at 4 million pre tax for the full year for this computer repair centre (p/e around 9). Results out later this month (18th i think).
Fair enough so far.
But since those projections the company has completed an acquisition from Fujitsu Siemens and landed contracts over three years worth........ 55 million! (Over one and a half times its market cap!!) I am assured by a better number cruncher than me that at current rates of business it should add around 22p eps. That would make a stonking 33p next year (current share price 154p). Gives a p/e (prospective) of 4.7 on eps! For a computer stock?? And it takes the company to a whole new level. I remember when this company had three or four offices - and an HQ in Haddenham village - in the late 80s, changed days!!
Yet still a market cap that simply does not reflect this multinational company with fast growth now seemingly assured.
A CRaCker.

Well, I'm a holder, so I hope you're right. On current forecasts, the shares look fairly fully valued. However, the contracts you mention would add about 17% to turnover (109m last year), and that must do something for profits. Charles Stanley is reported to have issued a buy note last week, saying that they are a strong buy ahead of results, and I suspect that that is the reason for the recent sharp rise. CS must be expecting that next year's results will be much better than forecast.

Hi Diogenes it's the prospects for next year that excite me following the contracts and acquisitions late 2003, which i think the market has yet to really factor in. Bit of chart resistance above 200p but I can see significant gains over next twelve months above that level.

Think this ones got big potential and has put behind its problems from last year. Would like to see margins creep up from circa of 8% but still think your onto a winner.

cheers GF.

Keeps moving up. There have been muddled mentions on the back page of the FT Companies section (on Tuesday and Wednesday this week). One said that Charles Stanley was forecasting 7m ptp for the year just ended. The other said 5.5m. It's very frustrating not knowing what the forecast is, but either way it seems to be a lot higher than the previous consensus.

Results due in less than a couple of weeks. 2million at halfway i am not expecting much above 4 million. Suspect your numbers are for the upcoming year. As gF says margins could do to improve but i think this has plenty mileage over next twelve months. A solid little number.

Wasn't expecting much more myself until I saw those reports, although I suppose there might be some contribution in the current year from the new contracts announced in October (and the acquisition of the Siemens Business Services IT repair centres). In any case, I agree that we can hope for a strong outlook statement for the current year.

Buy CRC Group at 256p (wrongly tipped on 4/8/2005 - now 96p)
Suggests Bill Johnston, editor of Watshot.com


From the first public offering the company was mainly identified as a player in the market of the provision of subcontract services to the major IT manufacturing companies in respect of their warranty maintenance and repair obligations to their customers. It was a specialist in the electronics and computer components and peripheral markets. It then acquired a business which extended its interests into the field of digital cellular communications.. The new business soon accounted for 70% of revenues, and as group resources formerly IT-dedicated were re-mustered and pointed at mobile phones and other consumer products, a large and growing market beckoned, with all the resources of modern technology, call centres and the internet, to assist.

The value of investments can go down as well as up. Investing in equities can lose you part or all of your capital. Smaller company shares can be relatively illiquid and thus hard to trade. And that makes such investments more of a high risk than larger company shares. Watshot.com is owned by t1ps.com Ltd which is authorised and regulated by the FSA and can be contacted at 49 Rivington St, London EC2A 3QB or on 0207 033 9389

By 2002 the Chairman's statement reflected an untroubled landscape. Another recent acquisition - which had made the profits expected, and more - had been absorbed into the infrastructure, and a flyer, the setting up of a business unit in Poland in anticipation of customer needs, had already moved into profit. The interim figures to June - sales were 50 million pounds against 44 million pounds, earnings per share topped 13p against 8p, and the half-yearly dividend was raised from 1.5p to 2.5p - posed a problem for just one man. That man was Alan McLaughlin, then newly appointed, his immediate predecessor having departed to seek to do for his own net-worth what he had accomplished for CRC shareholders.

In June 2003, a blow of considerable proportions struck the company's mobile phone business, reduced volumes, reduced prices and, from 2004, the possible disappearance of much of the Nokia business, CRC's then biggest customer. Everybody knew about these buzzing sectors, but not everybody knew about the fact that the slowing of volume growth had allowed the manufacturers to switch resources to the increasing of reliability, with a consequent slackening in demand for service.

A classic time to buy shares is when a setback which the management could not have done anything about, but does not damage capacity, causes investors to flee; and anyone that bought the shares on the June 2003 crash was not only looking at a profit, but looking at numbers which although dull, did not look threatening. Admittedly the Nokia thing did highlight structural weaknesses as well as ill fortune; but this did not pass unnoticed in the CRC boardroom either. And the next deal, just 1.2 million pounds spent which brought two German plants into the group (from Siemens), and 55 million pounds of new contracts with it, did not seem a bad riposte. And about a year ago a big new single-supplier deal with Vodaphone sent the share price sizzling up the greasy pole again; and January this kicked off with the start of a 45 million pound 5-year contract with ntl.

The forecast is for current-year earnings 20p per share. At the present share price of 256p, this means a prospective price: earnings ratio of 12.8 in the short term. Now the company stands ready to move into Italy. The spreading of the business base and the extension of the geographical reach adds another dimension in respect of the quality of earnings. And if and when opportunities for further expansion occur, there will be a war chest of surprising magnitude in support. The June interim figures are due in September, and I am looking for more good news and can still see plenty of headroom in that share price.