It was a more orderly start to the week with currency and equity markets after a volatile previous week.
The small and mid-cap space saw a good solid news-flow coming through. Here are some of the stories we noticed and followed:
Coronation ups its stake in Pan African
Asset management firm Coronation Fund Managers has upped its stake in the low-cost gold producer. In a SENS announcement released on Monday, Coronation indicated that it had raised its stake from 4% to 7.95%.
Education groups jump
Shares in Curro and Stadio saw their share price rise 5.2% and 15.56% respectively in Monday trade. This follows comments made at their respective annual general meetings and an update on student numbers from Stadio.
Mix Telematics stays near 12-month high
This technology group with a market capitalisation of just under R6bn continues to flirt with new 12-month highs. The stock is currently up 179% year-to-date and has indicated that it will be presenting at the William Blair 38th annual growth stock conference on 12 June 2018 in Chicago.
Invicta worth keeping an eye on
Shares in industrial group Invicta Holdings were down a further 4% on Monday (year-to-date down 26%). This takes the historical price to earnings multiple to under 10 and a dividend yield of 3.81%.
Hudaco does a deal
Another less than sexy industrial player which seems to be holding its own is Hudaco Industries which announced on Monday it would acquire Boltworld for between R80m and R111m (Variable based on stock that the company takes over). Hudaco trades on a PE of 11 and offers a dividend yield of 3.52%.
Sun International rights offer over-subscribed
Despite being down 32% over 5 years, shareholders have expressed an appetite for hotel group Sun International and their capital raising activities. The company issued 27.6m new shares at a price of R57.82 and the rights offer was 86% over-subscribed.
Blue Label back at R12/share
After what appeared to be some forced selling related to derivative positions which drove the share down below the R11/share mark, shares in Blue Label are back around R12/share mark. The share was up 1.27% in Monday trade, trading as high as R12.15 before finishing at R12/share.
Further Nu-World sale
We touched on the Nu-World directors selling yesterday and there was a further R1.3m in sales as an RMB structured product was unwound. 37 500 Nu-World shares were sold at R35/share.
Mettle and Tradehold finding their feet
Two of the share movers up on Monday were Mettle Investments (Up 45%) and Tradehold (up 10%). While volumes are light, Mettle was recently spun out of Tradehold and appears to be a vote of confidence from the market that management are unlocking value.
Catching falling knives?
Two of the biggest fallers on the JSE on Monday were Chrometco (Down 36%) and construction group Basil Read (down 15%) Both fell on tiny volumes. While Net Asset Value is not a good way to value distressed businesses, it’s interesting to see that Chrometco trades at 12c with an NAV of 40c and Basil Read is at 17c while reporting an NAV of 84c/share.
ArcelorMittal maintained at “Sell”
The steel firm – which has seen its share-price decimated in recent weeks – was updated to a “Sell” according to broker consensus forecasts gathered by Sharenet. The share now has a market capitalisation of just R2.8bn and is down 66% year-to-date.
The JSE and its perplexing run
Despite the sluggish trading volumes and introduction of new exchanges including A2X and ZARX, the JSE Ltd. continues to trade near a 12-month high. The share was up 4.3% in Monday trade. The JSE trades on a forward price to earnings multiple of 13.5 and offers a 3.3% dividend yield. Analyst consensus forecast for the company is a “Sell”.