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.

CAPE -I would prefer my money put to good use immediately, rather than line the pockets of the brokers

Cape delivered another strong performance in 2006 and its position in healthy markets appears to be very attractive.

Positive momentum is apparently especially strong overseas and overseas earnings now represent 56.4% of total contribution.

Industrial Disease Claims dropped during the period (£3.4m in FY06 against £4.8m in FY05).

Whilst this level is unusually low (resulting from a smaller number of meseothelioma claims) and some would say that it does provide further evidence that there are sufficient resources within the compensation scheme to finance all future cliams, I believe a risk still remains.

I am left distinctly unimpressed by the recent fund raising to support 'potential' acquisitions. I sense that management and the new broker simply chose a good moment to raise additional funds without any real certainty of the core acquisition ever happening.

What do they need all the cash for if nothing happens for several months or never at all-I would prefer my money put to good use rather than simply line the pockets of the broker.

I can't understand why institutional shareholders aren't more demanding.

If a deal doesn't materialse for several months it's hardly going to be good for the earnings.

 

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