No updates yet but expecting one any time. Looks way too cheap on a forward P/E of just 8.6 for 2011 and 6.6 for 2012.

Volex Group PLC

FORECASTS 2011 2012
Date Rec Pre-tax () EPS (p) DPS (p) Pre-tax () EPS (p) DPS (p)

Edison Investment Research
19-05-10 None 11.91 15.70 14.91 19.70

The Royal Bank of Scotland NV [R]
04-05-10 BUY 11.61 13.63

Charles Stanley Securities
20-04-10 BUY 12.60 17.63 17.00 23.33

Milkstone Ltd [R]
15-04-10 BUY 13.01 15.47

2011 2012
Pre-tax () EPS (p) DPS (p) Pre-tax () EPS (p) DPS (p)

Consensus 12.23 16.58 0.00 15.86 21.36 0.00

1 Month Change -0.37 1.11 -1.13 -1.97
3 Month Change -0.16 1.93 0.00 -1.13 -1.97


GROWTH
2010 (A) 2011 (E) 2012 (E)

Norm. EPS 31.41% 14.77% 28.81%
DPS % % %

INVESTMENT RATIOS
2010 (A) 2011 (E) 2012 (E)

EBITDA m 17.13m 20.14m

EBIT m m m

Dividend Yield 0.00% % %

Dividend Cover x x x

PER 9.86x 8.60x 6.67x

PEG 0.31f 0.58f 0.23f

Net Asset Value PS p 29.53p 52.55p

Dynamic Growth ahead.......

Volex ForecastsYear Ending Revenue (m) Pre-tax (m) EPS P/E PEG EPS Grth. Div Yield

31-Mar-11 251.04 12.39 16.28p 10.1 1.0 +10% n/a 0.0%
31-Mar-12 270.00 15.77 21.51p 7.7 0.2 +32% 0.55p 0.4%

Volex Group - Strategy in motion Click for report

http://www.edisoninvestmentresearch.co.uk/researchreports/Volex040610update.pdf

FY10 results confirmed that management actions are taking root. Sound foundations have been laid and the next phase of development is well under way. The scale of management ambitions should become increasingly apparent as growing financial flexibility feeds existing business momentum. We have raised earnings estimates by over 10%, giving growth rates in excess of 20% for the next couple of years, leaving forward multiples looking very undemanding.
Volex is a leading global provider of power products and interconnect cable assemblies. It supplies to large OEMs of consumer electrical and electronic devices, data and telecom equipment and healthcare and industrial products.
Year
EndRevenue
(m)PBT
(m)EPS
(p)DPS
(p)P/E
(x)Yield
(%)
03/09 265.1 8.310.9 0.015.1N/A
03/10 229.0 10.314.5 0.011.4N/A
03/11e 250.8 13.117.9 0.0 9.2N/A
03/12e 266.7 16.221.9 1.1 7.5 0.7

Volex Group is a research client of Edison Investment Research.

Good time to top up here, cant see this hanging around at these low prices with Brokers upgrading.

Today's Share of the week......


Volex-Striking a cord or two.



Ticker-VLX

Sector-Electronic and electrical equipment
Price-157

Market Cap-94m

Dividend-None






An old favourite of the Dot Com boom where its shares topped 2000p Volex has since fallen to as low as 18p in early 2009. There is a distinct flavour of a recovery story here as Volex appears to have been punished with the rest of the ebbing market during 2008. Orders dried up and the share price crashed.



Since then Volex has recovered to the current price and is a specialist in the production of power cables and assemblies. If you look around the house you will see Volex products on DVD players and other electrical equipment. Clients include Cisco, Dell and Samsung. They also sell via Screwfix.



Volex has been in an established upward trend since leaving the 20p range. It is forecast to be debt free by 2011 and the last results reported a 19% increase in profits and an EPS increased from 10.9 to 14.8. It is due to enter the FTSE Small Cap index on the 18th June 2010.



As China is the worlds fastest growing economy it would be prudent to have a stake in this flaring market. Volex has recently signed a partnership with Huawei Telecommunications supplying standard and bespoke assemblies for building a 3G/4G network.



Brokers price targets

RBS:270

Charles Stanley:200



Directors buys

CEO-40000 shares in March 2010







Major Shareholders



NR Investments Limited
15,082,434
25,036,840

GoldenPeaks Active Value Limited
11,178,454
18,556,234

Gartmore Investment Limited
5,411,620
8,983,289

Cadmus Capital Management
4,600,000
7,636,000






Hot forum

Well supported by other PIs very few negative comments on any forums. Common consensus that this is an overlooked share.

http://www.playersnet.co.uk/index.php

Volex VLX going well this morning was up 111% at one stage.

Wondering if its been tipped.

Smirkey Burns talking today.......

And talking of those kind of companies Volex (VLX) continues to be a dream trade. After very decent statement from peer XP Power it's been rising strongly and I picked up another lot, this time 2,000 shares at 173. Target 250 stop 130.

I've already nearly doubled on the shares I bought earlier in the year and profits of nearly 5,000 now. 200p will be an obvious barrier but 250 looks easy if it can break up through 200. It's come back today on not surprising profit-taking but I'm staying with it for another bounce up. When it moves up it motors and there is a bit more re-rating of VLX to come I think.

http://www.sharecast.com/cgi-bin/sharecast/story.cgi?story_id=3795122

LONDON (SHARECAST) - Power cords and cable assemblies supplier Volex has managed to increase sales without increasing its fixed costs and that has enabled it to quadruple interim profit.

Revenues jumped 43% to 157m in the six months to 3 October 2010, while pre-tax profit soared from 1.7m to 7m. Part of that improvement came from a sharp reduction in restructuring costs. Volex does not strip out these costs any more but they effectively reduced from 2.66m to around 600,000.

All the companys divisions are winning new business but the main growth is coming from the consumer side thanks to peoples appetite for gadgets. The second quarter is normally the strongest but the division continues to grow. Healthcare growth is steady as new customers are added.

The industrial sector has been boosted by telematics and agricultural equipment demand and this division is growing strongly from a small base it is still less than 7% of revenues.

The main disappointment was the telecoms division, which grew but with no help from India. There are delays in Indias 3G roll out and the government is re-certifying equipment because of concerns about Chinese spyware. There is pent up demand for 3G equipment and this could start to come through in the second half.

Volex says that its full year profit is likely to be modestly ahead of previous guidance and Charles Stanley has edged up its profit forecast from 13.6m to 14.4m.

Net debt is 10.1m. The operating cash inflow fell as higher sales led to increased working capital needs. The net debt figure will be similar at the end of the financial year.

A capital reorganisation will enable Volex to return to paying dividends next year.

A restructuring of the supply chain should enable Volex to use up more of its tax losses.

A very satisfying performance today.
Outlook said to be very positive.

Forgot to mention went long of VLX volex this morning. Copper prices coming down is good news for them. Good update today aswel.

Way too cheap this stock. A P/E of just 10 to 2013, historicaly they are giving it away.

Volex Group PLC

FORECASTS 2012 2013
Date Rec Pre-tax () EPS (p) DPS (p) Pre-tax () EPS (p) DPS (p)

FinnCap
20-07-11 BUY 17.70 24.40 3.00 22.00 30.70 5.00
The Royal Bank of Scotland NV
19-07-11 BUY 17.70 24.00 3.00 23.50 31.86 5.00
Edison Investment Research
11-07-11 None 17.70 23.50 3.10 22.23 29.50 3.30
Charles Stanley Securities
01-06-11 BUY 18.50 24.88 3.00 22.00 29.52 3.33
Milkstone Ltd
27-05-11 HOLD 18.20 24.25 1.00

2012 2013
Pre-tax () EPS (p) DPS (p) Pre-tax () EPS (p) DPS (p)

Consensus 17.91 24.17 2.74 22.43 30.42 4.20
1 Month Change -0.21 -0.20 0.32 -0.34 -0.31 0.01
3 Month Change -0.03 0.30 0.92 0.43 1.23 4.20


GROWTH
2011 (A) 2012 (E) 2013 (E)

Norm. EPS 26.00% 32.60% 25.86%
DPS % % 53.26%

INVESTMENT RATIOS
2011 (A) 2012 (E) 2013 (E)

EBITDA 17.37m 22.60m 26.67m
EBIT 15.16m m m
Dividend Yield % 0.89% 1.36%
Dividend Cover x 8.81x 7.24x
PER 16.90x 12.74x 10.12x
PEG 0.65f 0.39f 0.39f
Net Asset Value PS 29.87p 56.36p 79.65p

Hemscott premium

Fantastic results from VLX.......

http://moneyam.uk-wire.com/cgi-bin/articles/201107250700089331K.html

http://www.iii.co.uk/articles/16392/stock-watch-volex

Stock to Watch: Volex
Tue, 26/07/2011 - 00:00 | Edmond Jackson

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Strong revenue growth continues at Volex (VLX), the global provider of electrical and optical connecting solutions, which derives just over half its sales from Asia - serving various technology providers.

Its latest Interim Management Statement (IMS) cites like-for-like normalised revenue up 10% for the 16 week period to 25 July, a firm gross margin of 19.0% leading to a 21% rise in operating profit to 4.1 million.

Adverse currency translation clipped the reported revenue/profit rises to 2% and 3% respectively but in underlying terms this is impressive growth in challenged times. It is broad based across four sectors - consumer, telecom/datacom, healthcare and industrial - and could have shown 12% revenue growth excepting delays in the recovery of an Indian business.

This affirms continued success with a recent restructuring after Volex reported a 64% rise in operating profit on revenue up 38% and earnings per share up 130%, in prelim results to 4 April, announced early June. Now Volex is better positioned, it should be worth watching for further progress.

It also shows how "small cap share" does not necessarily mean a high-risk investment: Volex has withstood the downturn relatively well, with normalised pre-tax profit slipping only slightly from 5.1 million to 4.8 million over 2007-08, otherwise profit and earnings per share grew strongly to 10 million and 14.5p by 2010. Management says it continues to improve the sales mix with new products also efficiencies towards improving the margin.

Company REFS shows recent broker projections for about 18 million normalised pre-tax profit and earnings per share of 24p in the current financial year to 1 April 2012, rising to about 23 million and 30p respectively in 2012/13. The main risk factor looks to be general fears of a double-dip recession although management appears to have sufficient visibility of orders to assert in the IMS it is confident of meeting market forecasts for the current year.

With consumer products representing nearly two-thirds of revenue and profit, growth in internet-connected TV, living-room gaming consoles, tablet computers and smart phones are key drivers helping withstand recession. As was the experience of the early 1990s recession, it is possible for a few companies to stand out when they are geared to a technology watershed especially. It helps explain Volex's 41% increase in revenue to 196 million for its consumer products side in the last financial year, although industrial also did very well to double its revenue to 22 million.

Top-line progress like this really classes Volex as a growth share although the market is likely to be wary of cyclicality in electrical components/connectors (as we have seen with Premier Farnell (PFL) and Electrocomponents (ECM)) - which most likely explains the modest, forward price-earnings multiple of about 13 times falling to 10.5, with the shares currently at 320p.

Edmond covered the fortunes of Premier Farnell in a recent Stock to Watch.

Volex's financial track record and forecasted earnings growth also qualify the shares for the price-earnings to growth - or PEG - factor, which works out at an appealing 0.4 times. Generally with growth shares, a ratio less than one is considered attractive. It appears the company is benefiting "top-down" from this growth trend in consumer electromics, and "bottom-up" from a restructuring last year - to achieve a more streamlined business according to market sector and functional lines.

"We can now implement coherent, global strategies that cross geographical boundaries," management said on completion a year ago.

So it is quite ironic how the share price chart shows a roller-coaster ride - from 206p in 2007, below 100p at end-2008 with the financial crisis, then a strong recovery to 377p by end-2010. It would appear the market's fear of "small cap cyclical" was more irrational than justified by fundamentals, although lots of good shares were hard hit in the 2008 downturn.

Rising input costs as raw material prices go up, are another factor to watch. Copper is particularly significant for Volex although management has been adept at aligning copper costs in customer and supplier agreements, with hedging of remaining exposure such that the current financial year should be quite protected.

For more on the outlook for copper, read: Copper revival set to continue in second half.

Probably the difficult context for stockmarkets right now, over debt issues, explains Volex's muted response to a strong trading update, the shares rising only about 15p to 320p on small volume. The market is liquid enough to enable trades of 5,000 shares within the market spread, however.

Volex has not made dividend payments in recent years, a factor which may have contributed to share price volatility as you are essentially judging the earnings trend and how it is likely to be rated. Even with an intended payout of 2.0p a share, to be paid soon and marking the resumption of dividends, the prospective yield is negligible. Brokers target 3p to 5p a share in future years however, with substantial cover of about eight times, hence scope to increase.

The balance sheet has only a small element of goodwill/intangibles, the assets are mainly current - inventories and trade receivables - also 12.7 million cash. Borrowing of 17.1 million compare with 23.8 million net assets and a refinancing of bank facilities has helped to slightly improve net debt to 4.6 million; however net assets per share work out only at about 38p so again you need to be confident about earnings.

Overall, the risk-reward profile looks to favour upside, with a return to 350p and better. Volex is well-positioned to key drivers of consumer electronics change and with sensible diversity, now seeing the rewards of its repositioning which should have further to run. While forecasts already assume significant growth over the next 18 months or so, its rating is fundamentally modest - yet should improve to the lower mid teens at least, implying nearer 400p as a medium-term target.

For more information see volex.com.

Overall, the risk-reward profile looks to favour upside, with a return to 350p and better. Volex is well-positioned to key drivers of consumer electronics change and with sensible diversity, now seeing the rewards of its repositioning which should have further to run. While forecasts already assume significant growth over the next 18 months or so, its rating is fundamentally modest - yet should improve to the lower mid teens at least, implying nearer 400p as a medium-term target.

Some over road say they have lost Apple as biggest customer!!.

Not in but interesting to watch how this plays out if the above is correct.

Meanwhile, looking at the small-cap end of the market, Volex is having a dreadful time. The maker of connectors, wiring assemblies and related products saw its shares fall off a cliff in September when the firm issued a profit warning due to an unexpected fall in demand from one of its biggest customers.

Since then the shares have fallen further, reaching a new 163p low today. So what is the future looking like? Well, with ongoing fears that we might not have heard the worst, the firm's forward P/E rating of 7.6 is perhaps understandable. But there's still a very well covered, if modest, dividend of 2.5% expected.

2nd profit warning today... 95p.

StockMarketWire.com
Volex said it has acquired Applied Micro Circuits Corp's active optical technology platform for about $2 million.

Under the agreement, AppliedMicro has agreed to a five-year, non-compete in connection with the marketing and sale of active optical cables, transceivers, modules and related assemblies.

The companies would share ownership of the associated active optical patent portfolio, allowing each company to continue development of the technologies, and forming the basis for the two companies to collaborate on next generation optical interconnect products and solutions.

These look interesting, could they regain their spark.

In the short term the company has hit a rocky patch. Again a risk but the rewards can be huge. The £61 million cap manufactures fibre optic cables and connectivity components for smartphones, tablets, pcs, printers, tvs, etc. Manufactures have delayed and pulled orders amid delays to new device launches. Hence profit warnings
last year. Shares have fallen from 274p to below 100p.

In the short term struggle imply earnings will fall from 26.5p to just 5.7p this year
EPS is anticipated to double to 11.3p in 2014 and than advance to 16.4p the year after. That would take the PE from over 17 to 8.7 and then to a mere six. The sector average PE is 15.5 at this time. So a re-rating to just ten times within the year would target a share price of 160p for a 60% upside. Also a predator could be drawn on this lowly valuation.