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GHF Portfolio 2020/21 squad
Pot 1. Covid beneficiaries &/ or lockdown resilience
#WEY see thread for rationale...
I’ll post Pot 2. tomorrow & my first portfolio performance update for 2020 at end of week...after all, only 8mths gone!!!😳 Image
#BOKU Rationale:
(1) Strong H1 with TPV +35% (2) Largest DCB payments company & recent acquisition of Fortumo cements global leadership (3) Op gearing emerging (4) Identity side set to scale FY21 (5) New e-wallets provides access to 2bn potential customers with nil in forecasts👇🏻
#EKF Rationale:
(1) 4x “ahead” trading updates in FY20 (2) Strong B/S & cash generation (3) Excellent management (4) Primestore collection device in significant demand for COVID testing (5) Value of #RENX stake (5) Possibility of further upgrades in FY20
#GMR Rationale:
(1) 2x “ahead” trading updates in FY20 with EBITDA raised +110% from original estimates (2) Fixed costs with large drop-through (3) Increased licence deals with large drop-through in H2 (4) Significant US growth as states open up online gaming
#OMIP Rationale:
(1) H1 beat (2) Op gearing emerging as observed in H1 with revs +28% but op profit +98% (3) Predictable revenues with 88% reoccurring (4) FCF yield c.12% (5) £6m raise to drive growth via new equity release product👇🏻(5) FV of catalogue iP worth 3x share price
#PLUS - New Holding -Rationale:
(1) Several H1 upgrades (2) 190k additional customers added in H1 which should help H2👇🏻(3) Tax rate reduced from 23% to 12% with $100m rebate (4) Share buyback & possibility of special dividend (5) Broker forecasts look incredibly low for FY ImageImage
#SPSY Rationale:
(1) Predictable earnings & history of upgrades [see original write-up👇🏻] (2) End customers include the US Fed & BoE (3) Strong B/S, cash generation & div yield of 5% (4) #DLAR reported at 100% capacity in banknote printing, so further upgrade likely for #SPSY
#TPX Rationale:
(1) Significantly ahead in Q1 (2) Beneficiary of acceleration in Digital Transformation for UK (3) Strong B/S & cash generation (4) 10-15% organic growth PA (5) Targeting £100m rev & £12-14m by March 2023
#WEY Rationale:
(1) 3x upgrades for FY20 (2) Strong B/S with net cash c.£6m (3) GM’s >60% (4) Student numbers to double (5) Ambitious - Wey 2.0 strategy accelerating growth following surge in demand for on-line education through disruption to traditional Education system pandemic Image
GHF Portfolio 2020/21 squad
Pot 2. SaaS or Recurring Revenues - robust earnings (5-a-side team)
#TIDE see thread below for rationale
The Litigators are up tomorrow in Pot. 3 ... Image
#GHT Rationale:
(1) Resilient H1 during the pandemic (2) Good earnings visibility (3) ARR +18% YoY (4) Clareti now 70% of revs & CAGR 59% in 5yrs. Only valued at 3.9x ARR (5) Legacy business also growing (6) Strong B/S (7) Disruptor winning against legacy vendors with old tech
#MMX Rationale:
(1) Resilient business model (2) Predictable annuity style revs via annual domain renewals + growth from new registrations (3) Strong cash gen (4) Fixed costs & a benefiary of op gearing (5) Domain sector consolidation driving up valuations
#RDT Rationale:
(1) V low valuation of 1.5x ARR (ex cash) despite £6m ARR & 81% GM's (2) Recurring revenues of 85% (3) Large contract renewals in H1 (4) Director buying (5) High op gearing (6) £7m raise to drive growth with ambition to triple ARR by FY23👇🏻
#SMRT Rationale:
(1) Beneficiary of "contact tracing" (2) Transition to fast growth SaaS business (80% ARR growth) (3) Net cash £6m (4) Sale of loss making business (5) Major distribution agreement with Softcat (6) CEO delivered in spades at #DOTD (7) Big opportunity with EVOKO👇🏻
#TIDE Rationale:
(1) Optimistic outlook for FY & also significant contract wins in H1 (2) Delivers 90% recurring revs with 90% GM's (3) Op gearing emerging, new wins drop through to bottom line (4) Blue chip customer base (5) Partners with Samsung & O2 (6) Profitable & cash gen👇🏻
GHF Portfolio 2020/21 squad
Pot 3. The Litigators - beneficiaries of economic uncertainty
#LIT see investment rationale below...

Pot 4 tomorrow with 2x new holding’s that I believe will benefit from the UK Chancellor’s £640bn infrastructure spending plans Image
#ANX Rationale:
(1) 5x upgrades FY19 (2) Solid H1 despite lockdown (3) Cash generative through the pandemic (4) Potential windfall via VW emissions case (est.£5m-£25m) (5) 20k case backlog estimate worth c.£200m cashflow (6) Considering 2x small earnings enhancing acquisitions
#BUR *NEW holding- Rationale:
(1) Potential re-rating on US Listing (2) Brokers est. company may be worth 5-10x m/cap with Petersen valued at $773m on B/S with Potential Value $1bn-$5.6bn👇🏻(3) Op Margins 78% (4) $1.6bn committed in 2019 to drive future returns (5) Strong cash gen ImageImage
#LIT Rationale:
(1) Seeing increase in demand for dispute financing (2) 9yr ROCI 134% & IRR 78% (3) Launched 3rd party fund raising $150m taking advantage of bouyant market (4) Adding global legal partnerships (5) Market leader in new corporate portfolio transactions Image
GHF Portfolio 2020/21 squad
Pot 4. Infrastructure - includes 2x NEW holdings. All should benefit from UK Govt’s £640bn spending pledge
#VANL see rationale below...
Final update Thur or Fri. Pot 5 contains special situations & contrarian plays. An eclectic collection😳 Image
#RNWH *New Holding -Rationale:
(1) Robust trading during lockdown (2) Op margin improvement (3) Strong cash gen (4) Benefiting from increased Rail spend (HS2, CP6)👇🏻(5) Infrastructure spend ramped up by Govt (5G rollout & Highways) (6) Also deliver flood & coastal protection ImageImage
#SRC Rationale:
(1) Strong H1 despite the pandemic (2) Valued at 0.5x reserves vs 1.7x for #BREE (3) Op margin improvement (4) Strong cash generation with FCF yield of 11% (5) Heavy materials sector will benefit from UK infrastructure spend (6) @rhomboid1MF & @Arregius hold 😃👍🏻
#VANL *New Holding-Rationale:
(1) Trading below NAV (2) Focus on op margin improvement (3) Beneficiary of housebuilding recovery & increased Rail spend [HS2, CP6] (4) Thanks @CapitalPmh for excellent broadcast
Now met mgmt & v impressed #VANL at 15min 45👇🏻… ImageImage
GHF Portfolio 2020/21
Pot 5. Special Situations - Mixture of contrarian investments with catalyst for significant re-rating (fingers crossed🤞🏻😬)
#WJA see Rationale below...

This is the last pot! I’ll review my 8 month performance & prepare a write-up Image
#CIR Rationale:
(1) Shares fallen [-60%] in last 2 years (2) Company overhaul & new mgmt headed by Ian Johnson who is a turnaround specialist (3) NIOX impacted by lockdown but recovering (4) Cash £12m at end May (5) Chris Mills with a large position (6) Thanks to @MGinvestor 🙏🏻
#EQLS Rationale:
(1) Shares fallen [-75%] in 12mths (2) Resilient trading through the pandemic (3) Valued only on 1.6x revs versus #AFX on 10.3x and #AGFX on 6.6x (4) Move to B2B timely with B2B revs +30% in H1 (4) Cash £7.7m (5) International Payments growing fast👇🏻 ImageImage
#FA. Rationale:
(1) Shares fallen [-50%] in 12mths (2) First Connected Home sale of £1m+ (important as high margin + SaaS recurring revs)(3) GM improvement plan implemented (4) Legislative drivers in Scotland & potentially post-Greenfell (5) Big beneficiary of US$ weakness
#HZD Rationale:
(1) Shares fallen [-40%] in 12mths (2) Potential NASDAQ lisiting (3) Strong B/S (4) Core business allows development of [a] CRISPR screening [b] BioProduction [c] Base Editing (5) Excellent analysis from @hareng_rouge that brought #HZD to my attention..see below👇🏻
#SO4 *New position -Rationale:
(1) Now fully financed to produce SOP by Q1 FY21 (2) Strong ESG credentials (3) Should deliver 63% EBITDA margin & high cash conversion (4) Offtake agreements in place for 92% SoP (5) Strong management team that have previously delivered👇🏻 Image
#WJA Rationale:
(1) They own 35.7% of HomeSend & Mastercard remaining 64% (2) X-Border payments scaling up with 93% QoQ growth in Q2 (3) Mastercard consolidation??? ... shares tucked away as I’m hopeful they’ll be acquired by MC at a reasonable premium
So, that’s the 25x hopefuls in GHF Portfolio 2020/21 squad for the season ahead. I’ve a few reserves if they disappoint. Only brief background behind each investment as difficult when limited by characters of a tweet

Please DYOR
Portfolio performance to follow this weekend

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