Investor's Champion Blog
Provides refreshingly forthright, independent comment on predominantly small cap companies and specialist investment funds. Informed opinion, based on first-hand research, but pulls no punches in exposing management weaknesses.

Just the Tikit!

Tikit which provides consultancy services and software solutions, primarily to large UK and European law firms and accountancy practices came out with a reassuring trading statement this week with the announcement that trading for the year ended 31st December 2006 was expected to be in line with market expectations and a significant improvement over the prior year.

Tikit’s another great cash generator with a seemingly dominant position in its core market of law firms. I have held the shares for the past 18 months but was somewhat surprised back in September when a key shareholder sold off 100,000 shares in the company at 210p per share-was there a problem!

With all the excitement surrounding AIM commodity minnows over the past 18 months, shares in cash generative Tikit effectively went nowhere for several months but started to really move from October.

Interim results to 30th June 2006 showed turnover of £11.4m and operating profit of £1.3m. Net cash inflow from operating activities was £1.7m and the group had £3m in the bank-all looking very good.

With a market cap of about £32m the shares are now priced at 258p and trade at just 12x 2007 estimates. I would acknowlredge that only the house broker and sponsored research house cover the stock so it’s definitely one for the private investor to do a bit of work on.

Anyway, I can hopefully look forward to the preliminary results in March with confidence.


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