The Lemon Fool

To help fill the board, tell us your favourite tech stock. Ideas are always welcome for share purchases:

Mine, GB Group (GBG). Its done very well for me, providing security software stuff to organisations like the government. I bought in after there was a bit of a hiccup in the government's managing of their Identity programme, that GBG was due to work with. As with all government IT messes, the news disappeared and the project went back on track.

and the SP went up and up after that. Add to recent news about fraud detection software being sold to Chinese financial institutions, I expect revenues and profits to increase further. Identity/security will always sell in today's world.

Apple. A genuine Buffet/qualiport stock with massive margins, a huge defensible moat. Aspirational and affordable luxury, so market nowhere near saturated.

The only thing that bothers me is their huge cash pile. Historically, companies with huge cash piles have squandered them on useless non-core acquisitions. But so far, they've shown no sign of being tempted to do that.

Gryff

gryffron wrote:Apple. A genuine Buffet/qualiport stock with massive margins, a huge defensible moat. Aspirational and affordable luxury, so market nowhere near saturated.

The only thing that bothers me is their huge cash pile. Historically, companies with huge cash piles have squandered them on useless non-core acquisitions. But so far, they've shown no sign of being tempted to do that.

Gryff

That's because their cash pile is sitting in a Cayman Islands account where they can't spend it for fear of being taxed

gbjbaanb wrote:

gryffron wrote:The only thing that bothers me is their huge cash pile. Historically, companies with huge cash piles have squandered them on useless non-core acquisitions. But so far, they've shown no sign of being tempted to do that.

That's because their cash pile is sitting in a Cayman Islands account where they can't spend it for fear of being taxed

Not any more. Trump's tax bill allows US companies to repatriate overseas profits in a tax-favourable way. It is anticipated that vast amounts will move to the US, especially from the big tech companies, like Apple, but also Google, MicroSoft, Facebook and so on.

Apple has made acquisitions before but they are usual modest in size. Google, MicroSoft and Facebook have done bigger deals.

I expect some will go to share buybacks, some to increase or introduce dividends, and some invested in the business.

The real question is whether all this repatriation is already priced in, however?

Lootman wrote:

gbjbaanb wrote:

gryffron wrote:The only thing that bothers me is their huge cash pile. Historically, companies with huge cash piles have squandered them on useless non-core acquisitions. But so far, they've shown no sign of being tempted to do that.

That's because their cash pile is sitting in a Cayman Islands account where they can't spend it for fear of being taxed

Not any more. Trump's tax bill allows US companies to repatriate overseas profits in a tax-favourable way. It is anticipated that vast amounts will move to the US, especially from the big tech companies, like Apple, but also Google, MicroSoft, Facebook and so on.

Apple has made acquisitions before but they are usual modest in size. Google, MicroSoft and Facebook have done bigger deals.

I expect some will go to share buybacks, some to increase or introduce dividends, and some invested in the business.

The real question is whether all this repatriation is already priced in, however?

Could be, but I think a tech fund or index would be a better choice at the moment, given the general upheaval across the board and the possibilities for "problems" caused by future regulation and legislation.

Incidentally, I saw an Apple van down our street today, one with a great big camera on the top. I assume they're making a streetmap thing like Google's and therefore probably pushing their own map technologies soon.

If you're interested in something much, much smaller and aren't afraid of an AIM stock, take a look at Tern PLC (EPIC: TERN)

Tern are slowly becoming something of a Judges Scientific (another AIM gem) but in the Internet of Things (IoT) space, with holdings of various sizes in 7 private investee companies (aiming eventually for around a dozen).

Of particular interest at present is their approx 57% stake in Device Authority Ltd, a private UK company who

provides solutions to address the challenges of Identity and Access Management for the Internet of Things (IoT) without human intervention.

In the last 12-24 months Device Authority have signed agreements for their patent-protected solutions with a significant number of IT/internet security giants e.g. Amazon (for AWS), Microsoft (for Azure), Thales/Gemalto, Comodo etc.

Tern have traded as low as 1.75p in the past 12 months before reaching a high of 27p much more recently now they're fully funded, before retracing to close around 21p on Friday.

Their AIM quote and sub £50 million mkt cap means they'll be off the radar of most private investors and funds, but their prospects seem vast not least if one of Device Authority's larger partners decides it wants their technology for itself.

I've invested recently at an average of just under 10p.

nautical wrote:If you're interested in something much, much smaller and aren't afraid of an AIM stock, take a look at Tern PLC (EPIC: TERN)

Tern are slowly becoming something of a Judges Scientific (another AIM gem) but in the Internet of Things (IoT) space, with holdings of various sizes in 7 private investee companies (aiming eventually for around a dozen).

Of particular interest at present is their approx 57% stake in Device Authority Ltd, a private UK company who

provides solutions to address the challenges of Identity and Access Management for the Internet of Things (IoT) without human intervention.

In the last 12-24 months Device Authority have signed agreements for their patent-protected solutions with a significant number of IT/internet security giants e.g. Amazon (for AWS), Microsoft (for Azure), Thales/Gemalto, Comodo etc.

Tern have traded as low as 1.75p in the past 12 months before reaching a high of 27p much more recently now they're fully funded, before retracing to close around 21p on Friday.

Their AIM quote and sub £50 million mkt cap means they'll be off the radar of most private investors and funds, but their prospects seem vast not least if one of Device Authority's larger partners decides it wants their technology for itself.

I've invested recently at an average of just under 10p.

I was looking at this stock back in January last year when the share price is bobbing along at around 3p a share. It had a huge spike to around 43p in June! and is back at around the 10p level where you invested!

Certainly a bit of a roller-coaster of a year with this one.

At 10p a share, is this worth investing for a long term punt, or wait for the price to dip below 10p?

Here is a technology stock that I am building a holding in. Sabre https://www.sabre.com/

Smithson hold it as one of their top ten holdings.

High return on Equity with a long growth horizon IMHO.

Quarterly dividend paid at circa 2.6% per annum.

I don't really get too involved in small tech shares but my step-son who knows much more about it than I has recommended Bidstack (AIM Listed). It has done well for me but it is very early days for what seems to be an exciting growth area.

http://www.bidstack.com/ . The latest RNS tells of a new advisory panel that includes a very senior exec from Spotify.

DYOR

MM

Further to my previous post and maybe not of interest to anyone but myself here is some more on Bidstack Group:

https://www.valuethemarkets.com/2019/04 ... fetime-op/

MM

gbjbaanb wrote:To help fill the board, tell us your favourite tech stock. Ideas are always welcome for share purchases:

Mine, GB Group (GBG). … I expect revenues and profits to increase further. Identity/security will always sell in today's world.

If that's your thinking then you might like Okta, a cloud identity management service.
https://finance.yahoo.com/quote/OKTA

Others that I like:
https://finance.yahoo.com/quote/AYX Alteryx data analytics platform
https://finance.yahoo.com/quote/MDB MongoDB NoSQL document database
https://finance.yahoo.com/quote/TWLO Twilio cloud communications platform

All growing revenues at >50%. I see no reason why they can't keep doing that and if they do, they grow into their current valuations in 2 years or so. But of course, if they do then their valuations should keep expanding nicely too.

Alteryx has even started turning a profit, but if I had to pick a favourite from the bunch it would be MongoDB.

This is a real tiddler but I like Triad (TRD). They supply IT staff for a lot of Government work and have done really well over the last couple of years. The market cap is just over £6m yet they have net cash of nearly £4m and look good for a post tax profit of around £1m this year. Net assets are just shy of the market cap which appears to have been adversely affected by a Court case brought by a major shareholder (she lost).

I think it could easily treble once things have calmed down with the difficult shareholder.

Other than that I like Angle (AGL) for the potential if they get FDA approval for their liquid biopsy system, news on which should be due soon, although I should say that my average price there is around half the current price and I think things may have got a bit ahead of themselves.

Just an update on Bidstack (BIDS) which I recommended in early April. The SP has doubled since then and they are looking very good for strong future gains.

MM

Historically I loved ARM, sadly it's gone now.

I currently hold Kromek (KMK). AIM quoted, make radiation detectors for medical imagery, security scanners and dirty bomb detectors. Tipped a litle while ago in the IC.

Ricardo (RCDO) who I also hold is really quite established. Some might question them as a tech company but I would argue that they very much are, just old school tech rather than new tech.

So Bidstack is up 350% (bought at 8p now trading at 35p) on my initial stake, should I cash in................?
Two of its clients were included in Google's stadia announcement which got people excited.
CEO speaking of target SP over £5.
This could be a huge opportunity or just another SP bubble that will burst.
Sometimes I think it would be easier to stick with a HYP!
MM

Thanks MaraMan - what a result!

According to Lee Freeman-Shor's excellent book, 'The Art of Execution', from memory (I shall have to re-read it) you should 'trim' your holding (selling a %) rather than fully cashing out and set a rolling stop-loss so that if the price falls below 80% of current highs, it won't be catastrophic (you can always buy in at a lower price if you still believe in the story - I did this with FireAngel (FA.) stop loss kicking in at 78p and repurchasing at about 25.75p and now, thankfully, price at 42p).

Or you could always 'run your winners' as many promote here (but I would always put in the rolling stop loss as a safety net).

Cheers, OLTB.

MaraMan wrote:So Bidstack is up 350% (bought at 8p now trading at 35p) on my initial stake, should I cash in................?
Two of its clients were included in Google's stadia announcement which got people excited.
CEO speaking of target SP over £5.
This could be a huge opportunity or just another SP bubble that will burst.
Sometimes I think it would be easier to stick with a HYP!
MM

first world problem! I would never have invested as I think Google will pout its adverts on and bypass any 3rd party, and they still could.But you can run with it and keep a trailing stop loss going to get out if you start to see it wobble.

Thanks for the replies and appreciate the advice. I am afraid that I dont know enough really to argue it merits, other than I believe their agreements are with GRID and Football Manager at present, not Google which would be the delivery mechanism under Stadia. My step son though is a major league tech head and believes in the company which is good enough for me but I appreciate not for anyone else.

I think a rolling stop loss is the way to go, not sure what I would do with the cash at the moment given the state of the markets if I sold out fully or partially.

Cheers both

MM